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Why solving the productivity crisis is crucial for growing SMEs

At the start of 2018, research revealed that a staggering 93% of SMEs in London were struggling with productivity. Even in the highest performing areas, numbers were still troubling – 78% in Yorkshire confessed to facing productivity challenges.

Clearly, productivity is a big topic for SMEs. In fact, the problem is so pressing that a group of business leaders have launched an attempt ‘to improve the efficiency of small and medium-sized enterprises in an effort to close the large productivity gap between Britain’s most successful companies and the underperforming majority’.

But despite the widespread nature of the issue, it doesn’t appear to be an immediate concern for many. In fact, a survey by HSBC revealed just 7% of respondents planned to place boosting productivity at the top of their agenda, with four times as many being worried about a possible economic slowdown. Which is concerning when you consider how crucial productivity is for growing SMEs.

Cause and effect: why productivity should be a key concern

Low productivity has many causes, including employee disengagement, staff sickness, company culture, and a lack of skilled workers. It can also be caused by inefficient infrastructure, like outdated business telecoms and sub-par equipment.

But why should growing businesses actually care? Primarily, because low productivity correlates to low profitability. By itself, this answers the question of why solving productivity is crucial for growing SMEs, although there are a number of other troubling effects.

Low productivity is also often related to poor staff morale, which in turn can lead to low motivation and increased employee absence. It could even result in losing key staff members – and for an SME, the high cost of recruiting quality candidates could be prohibitive. Across the board, it’s a serious problem. But there are ways to tackle these challenges and boost productivity (and profits), providing you’re willing to invest the time and resource.

Chase engagement and efficiency

Engaged teams are 21% more productive than their bottom-quarter counterparts, according to research by Gallup. Championing engagement is therefore a good place to start. But nurturing staff engagement doesn’t solely lie in the realm of culture and benefits. The tools your staff use every day have a big effect on how engaged and happy they feel at work.

Outdated platforms and devices are also more likely to be inefficient, slowing down processes and impeding workers. Productivity is calculated as output per worker, so improving your team’s efficiency is a sure-fire way to boost performance in this regard.

How does this look in reality? If you ask yourself the right questions before investing in a new telecoms solution, you’re much more likely to make the right choice. Considering what tools and platforms your team requires to thrive is always a good starting point. If your staff need to be mobile to carry out their jobs effectively, they’re likely to feel very frustrated if you only provide desk phones. If they rely heavily on video conferencing, robust and speedy data services are a must-have.

And of course, it’s an unfortunate reality that your team may well be judging you by the tools you give them. Modern tech reflects a forward-thinking business that’s willing to invest in the future, which is an attractive quality in the eyes of your employees. Outdated platforms have precisely the opposite effect.

It’s time for small business telecoms transformation

There’s a way SMEs can tackle both of these problems in one fell swoop – and that’s digital transformation. Investing in tech like business telecoms offers a great opportunity to improve internal processes. In fact, Gamma’s research shows 57% of businesses had this as a motivation in mind when they started their digital transformation projects. This is true across the board for digital platforms, but the points above can be neatly illustrated by voice solutions.

In a modern SME, employees need to be mobile. They want to work flexibly, without being chained to a desk – or indeed, standard desk hours. But this is precisely the productivity-busting situation created by a reliance on traditional telephony. Instead, SMEs should empower staff to maximise productivity with a mobile solution like Connect, which combines the agility of a mobile with the features you’d expect from a desk phone, like call reporting.

SMEs can lead the charge

If you run a smaller business, you may be concerned about the cost of investing in digital transformation. But this shouldn’t hold you back – the short-term cost of investing in productivity-boosting platforms can be quickly outweighed by long term savings and performance improvements.

Because while SMEs aren’t the only organisations who need to solve productivity, growing businesses are uniquely placed to take advantage of technological investment with a view to fighting low productivity. Larger firms are often sluggish in their innovation – in fact, some are completely set in their ways, and don’t invest in tech at all. Smaller businesses, in contrast, have the versatility and agility to lead the way on innovation – not to mention a huge amount to gain by boosting their productivity performance.

Small business telecoms have changed – make sure your organisation keeps up with the help of our eGuide, Winning the Digital Transformation Game.