By David Tyle, Founder and CEO of Outlier Technology.
The technology market is expanding almost on a daily basis, and there is a confusing whirlpool of contradictory opinions about which tools SMEs should be utilising. So, it’s hardly surprising that many leaders are struggling to avoid common pitfalls, and seeing their tech-focused projects fail as a result.
Implementing or enhancing systems is never guaranteed to work out, and learning from mistakes is often the best way to ensure future success – but it’s also important to be aware of some of the most frequently-seen mistakes among SMEs in the UK so leaders can set themselves on a path more likely to lead to positive results.
1. Treating technology as a silver bullet
The hype cycle around new technologies, which in recent years has focused on the explosion of the AI market, can lure SME leaders into believing that technology is a magical solution to all of their problems, and will result in unlimited success and profitability. There are of course those who credit tech for their achievements in building multi-million or even multi-billion pound businesses, but simulating their digital strategies simply won’t equate to the same level of success for every other SME.
Organisations are unique organisms and dropping a new piece of technology into them without fully evaluating the specific problems that need to be solved is rarely the quick fix that anybody wants or expects. Yes, it might work. But it’s unlikely – and then leaders are faced with either abandoning the project, or having to significantly up the budget in order to try and mould the tech into the magic solution they so desperately wanted.
There will of course be specific tasks and teams that can be helped by specific and precise application of technology, but the details really do matter as relying on vagaries simply wastes time and money. Senior management must have a thorough understanding of the problems being experienced, so they can be sure any tech they sign off on purchasing is going to actually solve those issues.
2. Using automation as the main driver for cost savings
Automation has long been regarded as the ultimate in clever tools for the workplace, and the current trend around Generative AI is no different. So attractive is the lure of AI that some SMEs are focused solely on what can be automated to make cost savings, rather than analysing all aspects of their practices and processes. A comprehensive review might reveal wasteful processes – these don’t need automating, they need eliminating altogether – or inefficiencies – which require better organisational design or better use of technology. Especially in smaller businesses where budgets are more constrained, it’s vital not to become so busy trying to implement AI everywhere that we overlook the other ways that we can streamline costs and improve productivity.
3. Not effectively integrating systems
Many SMEs have systems which are ‘owned’ by a specific team and not integrated properly across the whole business – meaning, for example, that the HR system can’t talk to the finance system properly. Integration might be a complex job, but it’s almost a guarantee that not doing so will create more headaches, which will only get bigger as the organisation grows.
A systematic approach is very much needed to ensure we don’t get so overwhelmed by the scale of the project that it becomes untenable. By focusing on the glue – the single integration points between systems – we can make a huge difference. A good starting point is ensuring consistency across all systems, and making this a mandatory process going forward. This includes IDs for customers, employees and suppliers, and invoice references, as if these aren’t exactly the same on all systems, it’s a real barrier to them being able to ‘talk’ to each other effectively.
Conversely, if we get this right, all of the additional automations, reporting, building intelligence and time savers can be built as we need them – showing how something which is in reality a simple concept gives us the solid foundation of integration needed within all businesses.
4. Confusing the outcome with the process
Implementing a system because someone has had a good experience of it at a previous workplace might seem logical, but they might have been looking from a distance and seeing a system which ‘just worked’ without any comprehension of the work that had gone into getting it to that point. Often, there are failed starts, direction changes, and reshaping of an organisation around a tool that happen in the background – with the end process being a system that people are eager to recommend at their next workplace.
But the people, processes, environment and market differ for every organisation – even franchises and chains – meaning transplanting what worked in one on to another has no guarantee of success. Instead, we need to focus on the actual business outcomes we want to achieve and work backwards from that: viewing technology is a vehicle not a destination.
5. Defining success and failure after the project starts
An idea can seem great and then fail spectacularly. Quite often, when we analyse why it’s because there was no meaningful success or failure criteria defined upfront. Having clear metrics from the outset can stop us continuing to throw money down the drain if a project is failing. And on the flip side, they can give us the confidence to continue if it’s meeting the success criteria. Rather than seeking any semblance of a positive outcome from an already-underway project, or suggesting more cash to get the project over the line, we are forced to honestly evaluate the process against those metrics agreed on day one.
By setting clear expectations around the project, by ignoring hype and only implementing technologies which genuinely solve the company’s problems, by ensuring siloed systems are integrated, and by keeping an open mind to the many ways to solve a problem which don’t simply boil down to automation, we might not be able to guarantee success – but SMEs managing to avoid these tech mistakes are certainly weighing the scales in their favour.
