The growing gap between tech-savvy businesses and those struggling with technology has been accelerated by lockdown, with a huge difference in the average amounts of money invested in technology during this time, according to new research from Hitachi Capital Business Finance.
The research surveyed a sample of 1,464 small business leaders across the UK which areas of technology they had invested in during lockdown from new equipment, software and systems, and training. It found that businesses that made full use of new technology as part of their core business practices were twice as likely to have invested as those who admitted struggling with technology (65% vs 33%).
In addition, the average amounts being invested were considerably different between the two groups. During the course of the last 18 months, the average tech-savvy small business had spent £42,389 on technology. By contrast, the average amount invested by those struggling with technology was roughly a third of this – £15,097.
Specifically, tech savvy businesses were three times as likely to have invested in new software and systems during lockdown (30% vs 10%), with the average investment four-times that of businesses held back by their technology (£16,006 vs. £4,800). They were twice as likely to have committed to providing training for new software for employees (36% vs 15%), spending on average roughly double (£15,607 vs. £7,083), and twice as likely to have invested in new equipment (36% vs 10%, £10,335 vs. £3,214).
The research showed that hybrid businesses (working part office, part remotely) were significantly more likely to have been investing in their company’s tech the past 18 months than other groups. Three-quarters (74%) had invested in their company’s tech equipment, software and training, compared with 60% of businesses that were solely office based, and 55% working solely from home.
More than a third (36%) of hybrid businesses believed this investment would enable them to become more agile as a business, compared with just 18% of office workers and 21% of solely remote workers. Similarly, 29% of hybrid business leaders believed this investment would help boost productivity in the long term.
The study has also revealed a gap in tech investment when it came to the size of a business. Medium sized businesses (those with 51- 250 employees) were significantly more likely to have invested in their company’s technology over the past 18 months as smaller businesses (73% vs 53%).
Again, half of medium-sized businesses believed this investment had made them more agile as a business, with the same believing it had made them more productive. For smaller businesses (>50 employees), just a fifth (22%) believed they were now more agile, with a quarter (24%) more productive.
Joanna Morris, Head of Insight at Hitachi Capital Business Finance said“Lockdown brought the future forward almost overnight. Without warning, many businesses were forced to radically alter the way they did things, using technology to help facilitate this. As we re-emerge from lockdown, we are likely to see the gap continue to widen between businesses that have technology at the core of their thinking, and those that don’t. Alarm bells should be ringing for businesses that are struggling with technology to ensure they are not left behind.”
“Small business owners have clearly placed great value in the outcomes of home/remote working. The amounts spent – whether large or small – upgrading systems and furthering technical prowess can only signify a long-term investment plan across the small business community to enable a better way of working to suit the needs of both the employer and their employees. Part of our job is to encourage businesses to consider their finances and to help them understand that when it comes to getting funding, there are a lot of choices and options on the table.”