All companies experience moments that highlight shortcomings in organizational goals, strategies, and operations. But this most recent period of disruption and uncertainty is compelling many small and midsize businesses to question the resilience and readiness of their most fundamental capabilities – especially data analytics.
An April 2020 Oxford Economics study recently uncovered a sense of unpreparedness among the 2,000 small and midsize business leaders surveyed across 19 countries. Approximately half of the participants cited that the pandemic brought a series of operational disruptions and market volatility that has challenged their ability to serve customers reliably, engage employees authentically, and build trust with their partners.
But perhaps most telling of all is how small and midsize companies view their access to data-driven insights to support their business goals and digital transformation efforts. Fewer than 40% of the respondents say they have all the data to support analytics-based decision-making.
Facing off the data deficit
Traditionally, small and midsize companies have enjoyed an inherent advantage in forging close bonds with their customers, employees, and partners. Lately, though, everything in their business and marketplace has shifted so profoundly that this sharp edge is beginning to dull. In fact, 67% of small and midsize businesses shared with Oxford Economics that larger organizations are increasingly able to provide personalized experiences to their customers.
In a line of thinking that may seem paradoxical, gaps in data collection and analysis hinder how small and midsize businesses engage personalized human connections with their customers and employees.
This data deficit can have a dramatic impact on how the company builds long-term resilience and agility to survive and thrive in today’s economic conditions. It obstructs any response to change, such as supply chain shortages, resource availability, customer demand, and government mandates and restrictions. The longer the pandemic continued, the more likely business leaders expressed their concern over the scarcity of real-time data intelligence.
Investing in digital tools can help small and midsize businesses develop personalized and economically efficient customer and employee relationships, even during an economic downturn. As emerging technologies become more accessible in the cloud, organizations can integrate, for example, predictive data analytics, automation, and artificial intelligence into their operations.
Improving analytics capabilities to breathe new life in experiences
According to Oxford Economics, 81% of the participating small and midsize companies either are taking steps or have already completed efforts to improve the analytics on customer data. Meanwhile, 66% have either piloted or are already using predictive analytics.
But to translate analytics investments into meaningfully improved customer and employee experiences, functional areas need to work together to mature their use of data, such as:
- Increase data capacity: Incorporate analytics into existing technologies and processes to deliver real-time information across the business and keep the management team informed in back-office operations and customer-facing performance.
- Prepare for growth in better economic conditions: Adopt tools that help manage processes by tapping into multiple internal and external sources of real-time data to create an intelligent platform for future growth.
- Go deeper with embedded artificial intelligence: Research use cases for artificial intelligence, machine learning, and predictive analytics that help the business generate, analyze, and act on data – which can be a significant competitive edge against larger companies and digital startups.
- Capitalize on strengths: Collect and analyze data in ways that provide clear visibility into decisions, tactics, and strategies across the business – no matter how much or fast it grows.
By taking these steps, small and midsize businesses can get underway in developing and delivering data-driven experiences that capture and engage customers and employees. And more importantly, they will have the real-time insight necessary to meet strategic priorities that can boost their competitive edge.
Get on the right track toward business recovery prescribed in the following research resources from Oxford Economics, sponsored by SAP:
Overall study summary: “Digital, Resilient, and Experience-Driven”
Analytics-focused summary: “Data-Driven Experiences”
Follow through with an analysis of your business’s resilience and agility in 5 minutes using the IDC SME Analysis Tool, which assesses 5 key areas: strategic planning, processes, customer relationships, suppliers and distributors and people experience.
This article was originally featured on SAP Brand Voice, Forbes.