Medium sized companies that fail to make the most of the digital revolution are being left behind. 

And I don’t mean the Cloud or a new website – the real benefits of the digital revolution are how we make money from the changes.  Think about it, we all know mega companies like Dyson and Amazon structure their operations differently to get maximum growth – and who could argue about their financial reward!  But most Entrepreneurs don’t know why and how they do this. What are the real advantages of the digital revolution for businesses?

Advantages

Firstly, companies like Dyson benefit from advice provided by international law and accounting firms with a global perspective. You might be well-read, but do you and your advisors truly consider your business from a global standpoint?

Secondly large organisations shamelessly recognise and control 5 distinct functions; 1. Marketing & Sales, 2. Operations, 3. HR, 4. Finance and 5. Legal & Structure. Ruthlessly synchronising and controlling these functions to maximise, top-line and bottom-line growth.  Pre-digitisation, there was no way to split these functions all over the world and control them well because there was no reliable means of instant communication. Big businesses now operate specific functions from the best location to their advantage, knowing they can control these functions seamlessly.

SMEs are waking up, partially due to COVID-19
Medium sized business, forced to operate differently during COVID-19 are starting to see the opportunities, but how many are now capitalising on them?

Why SMEs Fail

Most SMEs can’t visualise their business as these distinct 5 functions; believing their control is easier when everything is an amorphous whole. Heavy focus and many waking hours are devoted to sales, neglecting the other 4 functions because they see Sales as the route to growth: outdated and flawed thinking.

Successful sales without effective HR management and efficient operations are not sustainable. As soon as orders come in, MDs often shift focus to resolving operational issues. This pendulum effect consumes time and mental space, impeding growth.

Similarly, if the Board neglects the investment funding needed for sales, how can operations and HR grow to meet demand? If the business structure and legal framework don’t support efficient operations, how will investors view your funding and risk level compared to larger competitors? Medium-sized businesses face many headaches like these.