New small business research shows businesses struggling with technology change and cost pressures

New research by Telstra reveals that many Australian small businesses are at risk of missing out on the benefits technology offers to drive efficiencies and help them compete.
· 02 July 2024 · 5 minute read

Research highlights

  • Only 48% of small and medium business owners expect to increase their use of technology in the next 1-2 years.
  • 58% agree that using digital technologies to become more efficient was a priority for them.
  • Almost half are either using AI or considering using AI in their business in the near future.
  • 61% are concerned about the risks to data and privacy that come with a greater digital presence; almost half don’t have basic cyber security measures in place.
  • Growing revenue and managing increasing costs ranked as top two concerns. 

Business leaders looking to tech for efficiency and competitive advantage

Telstra’s Business Tech State of Play report shows more than half (58%) of business owners say that using digital technologies is a priority to become more efficient and 69% agree that technology is now about much more than efficient working and has become part of how a business competes.

Time and money have become scarcer commodities in the past five years. Growing revenue and managing increasing costs ranked as the top two concerns, and business owners are almost twice as concerned than they were five years ago about having the time and capacity to get everything done.

Finding new customers and meeting the changing customer expectations ranked amongst the top concerns with technology. Having a current website is a simple way to meet changing expectations with more than two-thirds of customers (72%) saying they were less likely to buy from a business if their website wasn’t up to date. Despite this strong demand, more than half of businesses don’t prioritise updating their website.

“The pressure being felt by small business owners today is reaching boiling point,” said Amanda Hutton, Group Executive, Telstra Business.

“There is a real untapped opportunity for businesses to use technology in the right ways to help improve efficiency, attract and retain customers, and reduce cost pressures.”

 

Cyber Security and AI low on the priority list

Cyber Security is a growing concern but focus is overshadowed by other more pressing concerns. Despite the growing cost of cyber crime on Australian business almost half don’t have basic cyber security measures in place.

AI adoption is still relatively nascent with just 7% actively using it across a broad range of use cases. Data analytics and content creation are the most popular use cases, but others include using chatbots, virtual shop assistants and augmented reality in customer service, through to financial management and recruitment.

Of the businesses already using AI, 64% believe it is a competitive imperative and that businesses that fail to adopt AI in the next five years will lose their ability to compete.

Reliable connectivity top priority

The technologies businesses said will have the most positive impact in the next 1-2 years include:

  1. Access to fast, reliable and secure internet connectivity (57%)
  2. Cyber security solutions (34%)
  3. Digital payment technologies (28%)
  4. Cloud-based communications services (e.g. cloud-based phone systems, video-conferencing and collaboration tools (27%)
  5. Artificial Intelligence (27%)

Untapped opportunity to attract and retain staff 

A majority (79%) of workers surveyed want to learn more digital skills to further their career but only 39% of businesses offer training in this area. This presents an untapped win-win opportunity for businesses wanting to attract and retain talent.

One practical way business owners can meet this need and improve their business’ cyber resiliency at the same time is by signing their team up to COSBOA’s free online Cyber Wardens program, which is Australia’s first-ever cyber safety workplace certification program that will equip employees with basic cyber security skills to help protect against cyber security risk.

 

Businesses need support with technology

While the opportunities are clear and Australian businesses show an appetite to embrace new technology, more than half of respondents (54%) agree it’s hard to stay up to date with developments and know what to invest in, and 40% agree they want more support to help use digital technologies more effectively.

Telstra has 26 Telstra Business Technology Centres around the country with teams of business technology specialists ready to help provide strategic advice to businesses about their technology needs.

“Australian businesses are adaptable and entrepreneurial by nature, but they need help keeping up with the pace of change and prioritising what to invest in. In an environment where there’s no time or money to waste, businesses need good support and advice to adopt technology that will deliver the highest returns for their business,” Ms Hutton said. 

About the research

Findings based on a survey conducted in January 2024 of 1,000 owners and decision makers from businesses with less than 100 employees. The research also surveyed 1,000 Australians about how they use technology and what they expect from businesses they interact with.

About Telstra Business

Telstra Business was established in October 2023 as a new, dedicated function in Telstra, in recognition of the huge contribution Australian small to medium businesses make to the Australian economy, and the growing role technology plays in propelling their growth. Telstra Business supports Australian small and medium businesses to take full advantage of the transformative opportunities of new technology that come with a more connected world.

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