Published on the 02/02/2023 | Written by

Integration gaps stymie digital gains…

Nearly half of Australian and New Zealand mid-market businesses say their teams are wasting valuable time inputting data into different, siloed, IT systems, diverting resources away from activities that could be bringing in more business or upskilling teams.

In an example of how more is not necessarily always better, MYOB’s latest mid-market report shows New Zealand and Australian mid-market enterprises are facing a digital disconnect as they struggle with siloed, underutilised, outmoded and duplicated systems – and the productivity and cost detriments of them.

“They don’t have large IT departments to stitch together solutions.”

The survey of more than 1,000 mid-market decision makers was conducted in October-November and shows local companies are relying on an average of five business management tools or applications – many of which (three in Australia, four in New Zealand on average) were added in the past 12 months.

While the businesses say the new digital offerings they’ve implemented in the past 12 months have brought benefits (more on that soon), they’re also reporting heavy negative impacts from ineffective digital business management solutions.

While having their teams waste time inputting data into different systems lead the charge for both Australia (48 percent) and New Zealand (46 percent), it wasn’t the only cost. Forty-three percent of Australia mid-sized businesses – defined by MYOB as being 20 to 500 employees – and 46 percent of Kiwi businesses, say their teams are having to regularly check between systems to ensure data is correct and aligns, while 41 percent of Australian and 38 percent of Kiwi businesses are sometimes or often having to edit data transferred between systems.

Unsurprisingly, the decision-makers surveyed would much prefer their teams to be targeting new customers/audiences, focusing on strategy and business planning or training and upskilling existing team members – all tasks respondents say teams are being pulled away from by the requirement for the manual tasks demanded by disconnected systems.

“When it comes to changing or improving their digital solutions, mid-market businesses don’t have the same luxuries as larger corporates with large IT departments to stitch together solutions, or access to additional budget to cover complex integration requirements,” Kim Clarke, MYOB general manager for enterprise, says.

“Instead, many are cottoning onto the fact that more doesn’t mean better and are now after future-fit platforms that remove the challenges of disconnected systems, like lower productivity and higher security risks.

“They also know they risk falling behind their peers on every level unless these challenges are resolved.”

Indeed, when asked what was preventing them from improving their current solutions, 46 percent of Kiwi businesses and 36 percent of Australian, said it was a lack of technical skills to understand the specific improvements needed.

For Australian businesses it was, however, the effort required to change the ways of working that was the biggest barrier to changing or updating systems at 43 percent (44 percent for New Zealand). The high cost of technology was also a key factor for Australian respondents (32 percent), while the time required for more employee training (42 percent) was holding New Zealand businesses back.

It’s not all bad news though.

For those who have added to or changed their digital solutions over the past 12 months, the report shows the value of the benefits when implemented strategically, are significant, with 48 percent of Australian businesses and 45 percent of New Zealand businesses saying their teams are more efficient and productive.

In Australia the new systems are enabling mid-market businesses to service a larger/more diverse range of customers (39 percent), make more informed decisions (34 percent), providing more time to focus on business strategy and growth (32 percent) and enabling them to be more competitive in target markets (30 percent).

In New Zealand, it’s an increased focus on business strategy and growth (44 percent) that is a key benefit, behind the increased efficiency and productivity, followed by being more competitive in target markets (43 percent), enabling the servicing of a larger/more diverse range of customers (40 percent) and more informed decision making (30 percent).

“Having the right tools to make informed business decisions quickly and confidently is essential to business success in today’s market, and access to real-time data and information is a critical component – particularly for businesses operating in sectors impacted by change across international economies,” Clarke says.

MYOB research in December 2022 showed mid-market businesses across both countries were feeling buoyant with many reporting ‘better than expected’ results, and profitability increases in the 2022 calendar after the lows of 2021. For many a move to remote or hybrid working had resulted in a boost in productivity.

Looking to the future, the latest mid-market snapshot shows business leaders and decision makers are eyeing up big data as the technology likely to most significantly change their business in the next five years (39 percent for Australia, 44 percent for New Zealand).

Kiwi businesses leaders are also expecting digital sales platforms (44 percent), automation and robotics (37 percent), cloud computing (31 percent) and AI (30 percent) to significantly change their business in the next five years.

In Australia, it’s cloud computing (37 percent) and improvements in connectivity (35 percent) that lead the charge after big data, with automation and robotics (32 percent) and digital sales platforms (27 percent) rounding out the top five.