NZ small business productivity, technology

Westpac’s 2015 Grow New Zealand survey reports nearly one-third of New Zealand small and medium-sized enterprises say digital technology had no impact on their business over the past five years and 27 percent don’t expect it to in the next five years.

At first sight this looks bad, but the cup is two-thirds full. Most small businesses have seen advantages from using technology and almost three-quarters expect to see gains in the near future.

There’s been a lot written about why technology often fails to deliver expected productivity benefits. It doesn’t tend to focus on small business.

The technology industry should accept some blame for making exaggerated claims about what products can do. It sells things that are just good as game-changers and that’s only the thin end of the hype wedge.

There’s something else.

When cars first appeared on the roads 100 years ago, there were no rules. People didn’t know how to use cars properly. It took 15 years or so for road rules, traffic signs, speed limits and sensible laws to emerge. That’s how long people needed to adjust to the realities of the new technology.

There’s a similar adjustment period with digital technology. We don’t all learn how to use these things to their best advantage overnight. That’s human nature.

You say you want a revolution

The difference between today’s digital technology and the dawn of the motor age a century ago is that revolution was a one-off. Cars and lorries evolved over the years, but the switch from horse-drawn vehicles to cars only happened once.

In contrast, new digital technologies come along in successive waves. Even if we only pick out the major technology waves, they happen more than once a decade.

Ten year ago companies didn’t have to deal with mobile data networks or cloud computing.

And there’s the problem. We barely have enough time to learn the road rules of one technology transition before the next one turns up.

Much has been said elsewhere about the need to be comfortable with continual change. Many of us seem fine with this on a personal level.

Small business struggles with change

However, when it comes to managing a small company, business owners have many responsibilities. The added burden of keeping up with changing business technologies and how to best exploit them can be too much on top of everything else.

Larger companies can afford to dedicate staff to the job of keeping up with the play. Many don’t.

Seeing two-thirds of New Zealand small and medium enterprises win gains from spending on technology is something to celebrate. It’s an achievement.