"Integrating Small to Medium Businesses (SMB) into the digital economy"

Jack attended the 2018 OECD Forum in Paris. Jack is currently studying a Bachelor of Commerce at the University of Melbourne Faculty of Business and Economics and is also an Outgoing Exchange Manager for AIESEC Melbourne. 

Abstract

Small to medium-sized businesses (SMB) are fundamental components of the Australian economy and inextricably linked to middle-class welfare. With over 2.1 million SMB in Australia, they constitute two-thirds of the economy’s jobs and over half of private sector economic activity (Deloitte, 2017). With the rise of globalisation and the rapid growth of technology in the last two decades, the transition to a digital economy poses both risks and opportunities for SMB. Research has found that 87% of Australian SMB are not taking full advantage of the digital tools available to them, especially in regional areas. Given that SMB adoption of these digital tools can add $49.2 billion in untapped economic potential over the next 10 years (NPV), SMB adoption rates not only impact future economic growth and living standards but, on a broader level, impacts Australia’s capacity to compete on an international level (PWC, 2018). 

As such, the Australian Government has a clear prerogative to assist SMB. Although the reasons why digital technology is underutilised by SMB vary by geography, industry and characteristics of owners, recent reports have highlighted reoccurring themes of: a lack of education and training; limited financing opportunities; and a decentralised and disjointed support system, as key factors hindering their adoption of new technologies (Deloitte, 2017). With the rapid pace of digital technology making it difficult for SMB to stay on top of best practices, this report recommends that the Australian government establish a website and toolbox that can provide businesses with easy to understand information. Paired with a comprehensive marketing campaign, this website would assist in communicating the benefits of digitalisation whilst developing SMB digital capabilities. With the rollout of the NBN and other digital infrastructure projects taking place in remote areas of Australia, coupling this with streamlined training and information will assist in overcoming the divide between regional and urban SMB. Additionally, this report recommends developing a small business network to support the promotion of community digitalisation.

Read More