GBN Newsletter No. 27 – How Benchmarking can accelerate business adoption of digital technologies

How Benchmarking can accelerate business adoption of digital technologies

Introduction

Winning Moves has started work on an exciting project to encourage SMEs to increase their adoption of digital technologies. Independent research has shown that businesses embracing digital achieve significant productivity benefits and enhance their competitiveness. We will use our well established Benchmark Index® platform as the foundation to harness leading edge technologies with contemporary research to produce a next generation benchmarking tool.

 

The Case for Digital Technology Adoption

There can be little argument that digital technologies have become an integral part of our lives, both in a business and a personal setting. This is hardly news, in fact, it’s becoming increasingly difficult to find aspects of our lives that haven’t been impacted. Consequently, and there are no prizes for pointing this out, they have become a critical opportunity and threat for almost every enterprise, regardless of size, sector or location.

It is therefore not surprising that mastering the effective adoption and use of digital technologies in business is now essential to delivering business success. Inspirational leadership, insightful management, a motivated workforce, satisfied customers, productive processes, an innovative culture, fantastic products or services or both (depending on what the business does), and smart financial management all remain critical business aspirations. But effective deployment of technology is a theme that, today, cuts across them all.

However, despite its irresistible advance and increasingly fast evolution, many businesses have yet to fully harness the power of technology to capitalise on opportunities and deal with threats. This failure will be to the detriment and possibly peril of many, because, as their existing and emerging competitors forge ahead, failing to succeed in this area will lead to many falling by the wayside.

So what do we mean by digital technologies. These include tools that are already familiar – such as cloud based computing, CRMs, e-commerce, web based accounting software, computer aided design – as well as less commonly adopted resources, such as, for example, integrated digital systems, big data analytics, automation, artificial Intelligence, and virtual/augmented/mixed reality.

Digital technology has the power to enable start-ups to scale faster than ever and for established business to transform themselves. It acts as a catalyst for creating new business opportunities, increasing innovation, improving productivity, developing fresh and enhanced products and services, engaging workforces and, most importantly, yielding enhanced customer experiences and satisfaction. And the great news is that increased accessibility means that every business, regardless of size, has the opportunity to harness digital technology.

The case is compelling, so the question is – why don’t more enterprises put more energy into taking advantage of this revolution to milk the benefits it can yield?  Although each and every business is different, there are several common barriers faced when adopting digital technology. These include:

• A general lack of awareness of the potential benefits and opportunities: Many businesses do not adopt digital technologies as they are unaware of the benefits and opportunities that they present^[1].
• A lack of commitment from leaders and managers: low levels of awareness can result in limited buy in from leaders as they have not made the strategic linkage between the adoption of technology and their business and its future^[2].. Adoption needs to be led from the top, it needs to be an organisation wide initiative set within the context of a clear vision and leaders need to cascade and develop competencies across the organisation to make sure that everyone is pulling in the same direction^[3]
• A lack of skills and knowledge: the vast majority of SME’s lack internal capacity and capability to identify, manage and implement digital technology. Evidence demonstrates that digital skills are lacking at all levels of businesses (from the owners to the shop floor). Such a lack of skills can be self-perpetuating as increasingly employees want to work for digitally savvy firms^[4].
• A lack of trust in solutions/providers: many businesses have a level of awareness, yet struggle to understand exactly how digital technology applies to their business and what the implementation of such technology entails. Their lack of understanding results in businesses being unsure and wary of potential suppliers and solutions. Such businesses value impartial support to identify which solutions are most appropriate and to guide them through the implementation process^[5] .

 

How Benchmarking can help

There is no single way to overcome these barriers, but we firmly believe that benchmarking has a central role to play. It has a long standing, positive reputation for driving improvement in a variety of areas. Globally, Bain & Co[1], the respected international consultancy, has consistently recognised benchmarking as a top five management tool utilised by businesses across the world. Its reputation is founded on driving positive change in many business areas.

For more than two decades, this powerful methodology has been harnessed within Winning Moves Benchmark Index ® (BI) service, which has benefitted many thousands of SMEs in more than 40 countries. We will use this platform to create a next generation benchmarking tool designed to encourage businesses towards technology adoption.

 

Digital Benchmark Index ® Tool

We are currently developing a customised digital benchmarking tool to assess the performance and practice maturity of participating businesses in the adoption of digital technology. Research conducted by the UK Enterprise Research Centre^[1] creates a baseline on which to establish predictive algorithms. We will apply these algorithms to the information collected in the BI database to establish a longitudinal dataset.

The tool will be structured on four levels of digital maturity across nine digital proficiency dimensions. The aim work with participating SMEs help them improve, the diagram below illustrates this. The maturity levels are as follows:

1. Accidental: Adoption of several digital tools (such as social media), but this happens almost by accident and in a haphazard and uncoordinated manner. General levels of awareness of digital technology are low.
2. Experimental: Awareness levels have risen, and some individuals now recognise that digital technology could deliver benefits to the business (but sceptics remain). The business identifies several (often free) applications that could be used to underpin processes and functions, but these aren’t fully integrated with the business’s operations or strategy.
3. Active: The business now ‘gets it’ and is actively considering how digital technology can help deliver their strategic business model and added value to their customers. They are actively and effectively adopting digital technology and developing their internal digital skills and capability.
4. Optimised: The business now has internal skill and capability and is using digital technology to deliver competitive advantage, transformation and innovation. Digital technology is embedded across the company and central to delivering growth and productivity improvement.
   

For details on the model showing the proficiency dimensions and examples of the types of questions that will be asked please see GBNewsletter No.27.

The process will be facilitated by business advisers, who will collect survey data, create and feedback the resulting benchmark report, assist the business with producing an action plan, point them in the direction of high quality, appropriate technology options, and provide hand holding assistance to get them started.

 

Proving the concept

To prove the concept, we are about to commence a project that will answer the following questions:

• Can benchmarking be an effective means to motivate the adoption of new to firm digital technology?
• Does demonstrating the potential benefit of digital adoption (e.g. impact on turnover per employee/profitability) motivate adoption?
• Does demonstrating the potential and tangible ‹loss› (e.g. lost profitability, turnover growth etc.) of not keeping pace with peers motivate the adoption of digital technology?

We will develop understanding through a process that assists, particularly SMEs, to measure their current position, compare how they stack up against others, and then create impactful action plans to integrate digital products and methodologies into their everyday operations.

Winning Moves is delighted to be working with a stellar group of UK based partners to develop the concept and approach. Aston University will provide academic and intellectual rigour. North East Local Enterprise Partnership (LEP), Greater Birmingham and Solihull LEP and Sheffield City Region Growth Hub will identify around 100 businesses to benefit from the support process. This will be delivered by their experienced business advisers who will look to ensure that businesses participating gain maximum benefit. This is essential as we are looking for interventions to have a positive and long lasting effect.

The well-established BI management methodology will be customised in a way that will bring numerous benefits. These include…

• Bringing productivity to life for SMEs by helping them to measure performance in a meaningful and understandable way, then compare against others to see how they stack up.
• Putting the time and financial investment into technology adoption squarely in the context of potential financial return (or loss if not adopted), allowing business management to make informed decisions based on facts. This will encourage leaders to become more visionary about what technology can do for their business, motivating them to take a proactive future focused approach.
• Enabling businesses to consider different digital products and approaches, with an understanding of the associated benefits and impact of each
• Facilitating the process to provide trusted hand holding support where needed, including planning, taking first steps and maintaining momentum.

 

Next Steps

This article is designed to provide some useful ideas and insights into how benchmarking can help businesses to adopt digital technologies to drive success. Our intention is to follow up with a further article in 2020 year to share what has been learnt and how the tool and process has evolved.

 

Contact

Mark Modena

GBN Director Marketing and Growth

Director
Winning Moves Ltd

E-Mail: marka@winningmoves.com

 

Read the entire GBNewsletter No. 27