Managing Director, Canada at Sage – Empowering Canadian businesses by simplifying workflows to break down barriers and achieve growth.
The past three years have been a tumultuous time for small-to-midsize businesses (SMBs). As we emerged from the pandemic with a renewed sense of hope and optimism, many people are now facing new economic challenges, including inflation, a dramatic rise in the cost of living and other pressures.
Consider, for example, how the Canadian economy is built on the shoulders of SMBs, who represent more than 98% of all businesses in Canada. When Canada’s small businesses succeed, Canadians succeed. It’s with that thought that our company recently launched our second annual global survey, Small Business, Big Opportunity (automatic download), to understand how SMBs are navigating the current economic and business challenges.
The study found that the majority of Canadian SMBs (72%) are confident in their businesses. While Canadian SMBs are largely confident about the future, many are struggling to address the new set of economic challenges. The Canadian Chamber of Commerce released its 2023 Q1 Canadian Survey on Business Conditions and found that businesses expect rising costs may squeeze profit margins in coming months.
The talent shortage has also been a persistent challenge across industries and is evolving again. A recent report from the Canadian Federation of Independent Businesses claimed the number of SMBs impacted by labor shortages increased from 55% in November 2021 to 59% in September 2022, with owners having to work 59 hours a week to make up for labor shortages
SMBs shouldn’t have to navigate the economic volatility alone. I believe business leaders and the government share a responsibility to support SMBs by finding solutions and incentives to enable them to secure the right people and the right technologies to drive productivity and achieve sustainable growth.
To help negate some of the effects of economic challenges, more businesses are looking to drive efficiencies by adopting new technologies. However, to reach the goal of growing their business and increasing profitability, SMBs need to be strategic with how they’re leveraging these technologies.
Automating Administrative Tasks
It is surprising how much of our day is consumed by tedious and repetitive administrative processes. There are now AI-enabled financial tools available that can automate processes like payroll, invoicing, inventory, etc. and save organizations time and money while freeing up employees to focus on driving growth.
Incorporating automation into financial processes can significantly reduce close days, increase agility, lower costs, improve productivity, reduce delays, minimize errors and give your team more time to focus on strategy, business growth and success. If you’re looking to begin your automation journey, here are some steps to consider.
1. Understand what kind of automation you need.
Every business is different, and getting the best value requires understanding what areas of your finances could do most with automation. You can start this process by identifying which processes are critical for driving your business but require repetitive, manual tasks.
For example, cashflow is the lifeline for small businesses and every company has accounts payable (AP) and accounts receivable (AR). Traditional AP/AR relies heavily on manual data entry, which is time-consuming and more prone to errors.
By automating these two processes, businesses can seamlessly connect their customers, banks, vendors, and payment platform to automate payments. This not only minimizes the chances of human error, but can free up staff to focus on more strategic tasks aimed at growing the business.
2. Create a clear digital transformation road map.
To ensure a seamless, smooth and effective digital transformation journey, you need to understand where digitization can have the most impact on driving productivity, efficiencies and help to create an excellent customer experience. A successful digital transformation strategy will have you work closely with IT, vendors and your team, so a clear road map will keep all parties on track.
A good place to start is understanding which processes drive your business that can benefit wider teams, vendors or customers. An effective road map will outline the current internal and external business challenges, how digitization can impact key processes, what solutions/approaches businesses should go with based on the budget, time and resources available and a timeline for implementation.
To ensure automation implementation runs smoothly, it is critical to work with the IT team early and often. A successful implementation strategy relies heavily on the technical expertise the IT team brings to the project, so it is incredibly important that they aren’t left on the sidelines.
3. Get management buy-in.
To build trust in the technology with the wider team, getting buy-in from leadership to help demonstrate the capabilities and benefits automation can bring will be critical. In my experience, the quickest way to get leaders to buy into the digital transformation strategy is by highlighting potential financial savings and expected return on investment (ROI).
Other executives and employees may have concerns about the potential disruption the integration may cause, so it is important to address any concerns early on by positioning the transformation as a long-term strategy rather than a short-term gain. Clearly communicate how automating processes will help empower your workers to better focus their time and resources on delivering value to grow the business.
4. Measure results and optimize.
Gaining board approval and implementing the tech is just the start. With the tech in place, measuring performance to fine-tune and optimize processes is the next step in your journey. To scale your business, measurement is the next important step in the digital transformation journey, in order to help you understand how the new tech is operating within your environment. Quality solutions utilize detailed analytics to generate automated reporting that allows your organization to improve efficiency and visibility on how the implementation is functioning.
If the last three years have shown us anything, it’s that when times are tough, SMBs in Canada and around the world are incredibly resilient and will find new ways to thrive. Technology can help SMBs address some of the immediate needs today while preparing for success and future growth in the years to come.
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