The article talks through the obstacles that subscription-offering small and medium-sized businesses (SMBs) face with bringing new technology in. But outdated systems have dangerous impacts, so upgrading is imperative. SMBs have objections to change, but a comprehensive solution can streamline the process, cut costs, stop waste, and bring in money to the business both faster and more easily.
It’s hard enough out there for small and medium-sized businesses (SMBs), but SMBs that have subscription/recurring revenue models must overcome a special set of obstacles
One that is inevitable is technology integration, which brings new tech into the business to help with processes and pull all systems and platforms together.
It can be extremely overwhelming for some SMBs to even think about, especially ones that are not tech-savvy.
If this sounds like you, you might wonder, “Where do I begin?”
We understand because we speak with a lot of SMBs. So we’ve gathered up what we’ve learned from them about their concerns, and wrote this comprehensive article with actionable solutions you and your SMB can take to boost your operations and bottom line, no matter how much or little you know about tech.
The Challenge of Tech Integration for SMBs: What’s Behind It?
A large percentage of SMBs use older hardware and software and hardware that simply doesn’t work with newer technologies. Over time, they end up with a Frankensteined system that creates a knock-on impact.
For example, an SMB could have separate systems for:
- accounting (perhaps just Excel on its own)
- billing/invoicing
- payment collection
- contracts and terms
- customer email/communication
- Powerpoint or similar for reports
- supply chain
- paper and older software for data
And that’s just the beginning- we haven’t even touched compliance, marketing, sales, etc.
If this sounds like you, no doubt you suffer from huge silos. Everything is fragmented, and that lack of free-flow information forces you and your workers to spend endless time chasing information that’s often inaccurate or late.
It might cause a lot of costly revenue leakage too, caused by the mistakes, churn, missed sales opportunities, and underbilling that silos cause.
That means money poured down the drain. Money that you most likely can’t afford to lose.
You might be insisting that your resources are already limited, and a new, comprehensive system is unaffordable. Without the resources, it’s hard to invest. Costs to upgrade can be prohibitive. That’s a major concern for many SMBs.
The problem is that the need for tech integration is an inevitability. The problem is that the longer an SMB waits, the more damage can be done, and the more they lose out on.
In fact, without tech integration, it can be nearly impossible to cut costs.
Another common problem is a lack of tech knowledge. And it’s completely understandable. Few people have time to study software engineering on top of running an SMB.
It can be intimidating and confusing. And create a strong resistance to change that ends up hurting your SMB.
So how much damage is your SMB actually vulnerable to?
Avoiding Tech Integration: The Impacts for SMBs
Avoiding tech integration is extremely common and extremely costly. Though it’s a worldwide problem, there’s a solid example we’ll talk about shortly.
First let’s look at the problems that avoiding tech integration causes SMBs.
1. Inefficient processes: When systems aren’t integrated, your employees spend way too much time on things like repetitive manual data entry and constantly switching between platforms. This puts workers under tremendous pressure, cuts the chances for productivity, skyrockets operations costs and human error.
Example: When employees must manually enter customer details on one system, then pass on the information to customer service, sales, marketing, and finance so that they can manually enter the information too.
2. Data silos: Silos (or lack of information flow between departments no matter how small) isolates information and keeps it hard to access. This puts delays on a lot of things from invoices to reports. That means fees, leakage, errors, and bad short and long-term decision-making.
Example: Every time your accounts has to chase sales or customer service for contract terms, usage, add-ons and upgrades, or anything else to create invoices.
3. CX (customer experience): No tech integration delays all kinds of things in the customer experience including service delivery, invoice mistakes, and a lack of personalized experience. These cause customer churn, and it happens faster than you think: PriceWaterhouseCooper found 32% of customers would leave a brand after one bad experience.
Example: A customer could receive the wrong product offering or a delay in product delivery. This causes them to have a 30-second search online to find a competitor who undercuts you and poaches the customer.
4. Revenue loss and leakage: Mistakes and delays in billing and payment collection can seriously impact revenue. So do missed sales opportunities including upgrades and add-ons. On top of that, mistakes cause fees, compensation, and even more of a siphon on your resources. And that’s dangerous of your SMB is operating with thin margins.
Example: An invoice with a mistake costs another $25 to process, extra time for customer service to call and apologize, and extra money when offering them a discount to keep the customer on-side.
5. Scalability problems: When an SMB doesn’t have the tools to cope, customer growth can be more of a blessing than a curse. Operations simply can’t keep up, so the SMB ends up losing the customers they worked so hard to acquire, while damaging their reputation for reliability.
Example: Adding new product lines can bring in a new customer segment that has higher expectations, as well as creating a strain on operations, and international ecommerce.
6. Compliance risks: It’s virtually impossible to keep up with regulatory requirements without an integrated system that gives a clear view of any relevant legislation, changes, differences between regions, etc. There’s also the problems of data leaks, incorrect numbers and delayed reports for audits. It all leaves your SMB extremely vulnerable to fines, lawsuits, and damage to your reputation.
Example: A local IT broadband company does not realise that legal changes in rural set-ups and servicing require updating many customer contracts. Without doing this, they’re set-up for penalties and churn.
7. Employee turnover: Employees have a breaking point, and once things get too much, they’ll leave. Turnover is extremely costly to your business.
Example: A two-person sales team that is expected to hit unreasonable conversion rates and no tools to spot sales opportunities will be forced to spend the vast majority of their time cold-calling and cold-contacting, which is the lowest conversion rate there is. They leave, because they’ve been set up to fail.
8. Lose out to competition: The last thing an SMB needs is to give their competition any advantage, for free! And the simple fact is that an SMB that delays integrated tech solutions are highly likely to fall behind.
Example: An SMB lacks the ability to track the offerings of its competitors, so that pricing isn’t optimized, and customers become easily poached by a competitor who undercuts the offerings.
SMBs can get any of these problems, but they’re most likely to experience most or all of them.
”According to the Centre for Economics and Business Research and Xero, in the UK alone, the smallest companies could generate an addition £77.3 billion of extra revenue if they adopted the digital tech of the top 20% of tech adapters.
But if there are so many disadvantages of old, outdated systems for SMBs, why is there so much resistance to tech integration?
SMB Objections to Tech Integration
There will always be resistance, no matter how cost-effective or beneficial a solution to a problem.
Here are the most common objections we see:
It’s too complex – SMB business owners and workers worry they won’t be able to understand or manage a new system. “Better the devil you know” is more than a cliche- all of us tend to stick with the familiar chaos in some way or another.
No guidance – When SMBs are unaware of what type of integrated tech they need, they can choose the wrong solutions. This causes more frustration and wasted resources. And some software companies don’t provide enough support throughout the transition process, or afterwards.
Cost – SMBs who misunderstand how cost relates to ROI or chargeable expenses can leave them too focused on the upfront costs, rather than the long-term cut costs and increased revenue.
It’s not necessary – Even the smallest business can benefit from an integrated system that streamlines processes and makes customers happier. And it will be necessary if the business scales. Tech integration isn’t just for the giants. It’s also there to give a leg-up to those businesses that want to compete with the giants.
It’s too disruptive – Yes, integrating tech can require a short adjustment period. But the better the solution, the more minimized the solution’s disruption. There are also best practices like phased implementation and good planning that help. Long story short, any disruption that a good system brings will be nowhere near the disruption of not having one.
If you’re a little more curious about how different your life and business could be, that begs the question, what do you start?
Fixing the Problem: Which Actions Can SMBs Take?
Here’s what the entire tech integration process looks like, step-by-step.
Planning stage
- Look at what you have, the limitations of the system, and determine which limits cause you the most trouble.
- To help focus your effort, decide which problems should be solved. Billing accuracy? Better customer data usage? Reliable reports and information flow?
Expert advice
- You can bring in SMB consultants who are more aware of the unique challenges you face. They’ll also be clued-up on the best solutions for your needs and the best approach to take.
- Use your networks. You may have partners who can offer resources and support, Dynamics 365 Business Central does.
Choose the right solutions
- The more comprehensive a solution, the easier it will be to adapt to. Solutions like Business Central + Bluefort’s revenue recognition platform and integration service pulls together multiple functions (invoicing and billing, CRM, accounting, financial reporting) to work as a single system that keeps information flow between everyone in real time.
- There’s a big range of user-friendly tools out there, so take advantage of all options like demos and testing the support that comes with solutions.
Take it slow
- When possible, you can start with the most important parts of the system first, then add on additional capabilities when your needs and customer base grow. This minimizes disruption and solves the biggest problems first, without overwhelming yourself and your workers.
- Your employees should be trained in this system until they are comfortable with it. And ongoing training can help draw out the best performance of themselves and the solution.
Monitor and Adjust
- You’ll be able to monitor the performance of the solution as it is, and just it once you get a better idea of your needs and how they may change.
- Don’t be afraid to keep that feedback loop open. They are there to make sure that the transition is smooth, and they will be able to spot whether the solution is working as it’s meant to.
Broken down into steps, the process is a lot less intimidating.
And your SMB has a lot to gain. Like solving the problems that legacy systems cause.
And with the right solution, life becomes so much easier. You have more time and revenue, and fewer costs.
SMB Life with Dynamics 365 Business Central + Bluefort
The best tech integration can improve so much about the operations of SMBs with subscription/recognized revenue.
Business Central is the perfect ERP system that automates so much for SMBs. It’s also flexible and grows with you.
Experts in recurring revenue and membership finops, Bluefort can implement Business Central for you with all the customization you need to get the most out of everything the platform automates.
We’re here to help you:
- free your time and resources
- automate subscription financial processes
- cut costs and churn
- build your customer base
- bring in more revenue
- expand your business
- make your life a lot easier.
D365 Business Central and Bluefort are a comprehensive solution that delivers the best that cutting-edge tech can give to your SMB.
You get end-to-end management, which pulls everything together for you and your workers, with less work involved.
SMBs Can Work With Ease
SMBs have enough challenges with keeping up with competition and staying profitable.
And you shouldn’t have to worry and stumble through inefficient processes unnecessarily.
Why not find out what tech integration would look like for you?
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