UK SME research reveals key 2006 business challenges
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Kelly Murray
Golin Harris
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London - 29 March 2006
Introduction
Extrasys, the leading provider of technology as a tailored service for the SME sector, announced today the results of a national survey carried out by leading research house David Lewis Consultancy on SME views surrounding their main business challenges over the next year. The survey was conducted during the first two months of 2006 and targeted owners, CEOs and MDs of UK based businesses ranging in size between five and five hundred employees. The report, available upon request, analyses both overall nationwide findings and the results from companies in separate categories based on size and employee numbers.
Challenges in 2006
- Overall results from all respondents found that Competition (35%) and rising costs (28%) are the two main challenges for SMEs in 2006
- A quarter of respondents cite business continuity, risk and disaster recovery as the third most significant challenge
Technology innovation key to growth
- Over 80% of business owners recognise that the development of new business solutions is changing the culture of the SME market and is strategically important to the growth and competitive success of their enterprise
Main factors influencing implementation of technology solutions
- Overall factors influencing the choice and implementation of business solutions are cost (68%), customer service (31%) and the ability to upgrade (30%)
- Accessibility (29%) and customer service (33%) were the main factors influencing IT decisions by companies in the smallest segment of respondents - 5 to 25 employees
- Security (26%) was the main factor influencing IT decisions by companies in the largest segment - 251 to 500 employees
Security
- One of the main findings in the research found that small business owners across the UK are concerned about the security of their IT infrastructure with 60% believing their existing infrastructure is not secure enough
- Conversely, 6% of respondents recognised that business continuity was going to be a key expense for 2006, yet a quarter of respondents predicted that business continuity would be one of the main challenges facing their company in the coming year.
Technology as a competitive advantage
- Nearly half of all respondents agreed that their competitive position would improve by investing in new technologies
Economic environment
- Nearly half of all respondents agreed the economic climate in 2006 has not changed since last year whereas a third of mid size SMEs (101 - 250 employees) believe the economic environment is worse than 2005
Comment
Simon Arbuthnot, Operations Director, Extrasys, said:
"The research is significant because it highlights the disparity between the majority of companies who feel their existing IT infrastructure is not secure enough and yet still do not consider this one of their main challenges. This could be because of the inherent costs associated with wholesale IT upgrades or the lack of knowledge regarding new solutions which can change a company's culture and the way it operates. Nearly 70% of the respondents in this survey indicated cost was the main factor influencing their choice of technology.
"However, it is significant that a large majority of respondents agree that technological innovation is a key component in developing a successful and competitive business. Investment in the right solutions can strategically position a company to develop both its market position and secure far more efficient, flexible and secure operating processes. It is very clear that accessibility, security and customer service are the main drivers influencing smaller companies' moves to greater technological innovation."
Summary
- Technological Innovation Key to SME Growth
- Accessibility, Security and Customer Service the main drivers of change