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What’s really holding SMEs back from the cloud?

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It’s clear that during the Covid-19 pandemic, the cloud played a critical role in supporting business operations globally, supporting remote working across large-scale enterprises and small and medium enterprises (SME) alike. If cloud computing hadn’t previously earned its seat at the top table, it’s more than shown its true capabilities as a top driver of business continuity. 

In a recent research study by market research experts Vanson Bourne, completed on behalf of the UK Cloud Industry Forum (CIF), 69 percent of UK-based IT and business decision-makers indicated that they had accelerated their digital transformation plans – particularly surrounding the cloud – as a result of the pandemic. Cloud adoption stood out particularly, among public sector organizations and SMEs, with adoption rates at 82 percent for both – a rise up from 62 percent for public sector organizations and 54 percent for SMEs from only the previous year. 

The importance of digital transformation for SMEs in the UK is also reflected in the UK Government’s 2021 budget, where the Help to Grow scheme was announced. This program is designed to help SMEs move to the cloud, making remote working and collaboration possible. In the UK, 130,000 SMEs are eligible to benefit from access to digital tools via the program, which may help them to initiate more innovation and drive digitalization.  

This seems like good news on all fronts, but as indicated in the survey, 18 percent of SMEs surveyed still haven’t made a move to the cloud at all. Beyond this, 60 percent of leaders indicated that their company was doing “just enough” to become digitized, leaving room for further acceleration in digital adoption. 

It’s clear that there are still factors that many SMEs consider to be obstacles when it comes to digitalization and moving to the cloud. Perhaps there is more education needed on the benefits of moving to the cloud to help businesses understand not just whether the move makes business sense, but also how the move to the cloud is best orchestrated. 

Concerns surrounding cloud migration

The CIF’s research identifies one of the top concerns surrounding the cloud as, “migration is not perceived as straightforward.” In fact, the complexity of migration was the most commonly cited concern in the study, with 43 percent of all companies surveyed noting this as a potential difficulty, while 32 percent admitted that this could be down to a lack of internal skills and knowledge. 

Such concerns may be commonly held by companies and organizations that don’t feel comfortable with their data infrastructure, and are worried about ‘getting their house in order’ before they move to the cloud. That said, migrating to new systems, especially moving from on-premise to the cloud, can be a great time to look at data and embark on cleansing and mapping exercises.  However, companies may like to look at this as a marathon, not a sprint. Reviewing the mapping of data fields, and using data validation tools is a valuable exercise, but this will and should involve time and the support of many key stakeholders across the business to ensure the best possible outcome. 

Data validation tools may be worth their weight in gold in helping SMEs to assess how smoothly a migration will run, highlighting errors that should be fixed in advance, especially when firms are moving multiple systems into the cloud. 

Loss of client interaction

Professional services-based SMEs have experienced many benefits to the client login dashboard functionality offered by cloud applications; many of which offer self-service options for clients looking to do as much as possible themselves. In many cases, emails or chat messages have replaced phone calls and in-person visits, and automation has accelerated many tasks that may have previously been manual, tedious and slow. 

The problem is, for many SMEs who provide an advisory role, they worry that digitalization will represent a loss of client interaction. For example, when a chatbot can answer queries, a face-to-face meeting that could have been a chance to grow a relationship may no longer be required. 

However, there is an upside to this modern form of collaboration; digitalization and the cloud are opening up new opportunities for communication. If implemented correctly and appropriately, digital solutions should help companies of any size to build better relationships with their clients. 

By sharing information digitally, companies often introduce more touchpoints and more transparency, which can result in uncovering broader opportunities to embark on new projects and add new services. Client relationships may actually become more meaningful, with the removal of repetitive tasks that can be automated, allowing companies to focus on more strategic conversations.

Will a hybrid future increase productivity? 

To some degree, home working is likely to remain after regulations linked to the pandemic are over. According to a recent survey of 2,000 companies in the UK, and in-depth interviews with seven organizations in different sectors run by the Chartered Institute of Personnel and Development (the professional group for human resources professionals), most companies are planning to allow employees greater flexibility around where and when they do their jobs. 

The study also shared that more employers are reporting increased productivity benefits from homeworking compared to summer 2020, with respondents indicating that the shift to homeworking has boosted productivity (33 percent) compared to June 2020 (28 percent). As cited in its research report, CIPD has stressed the need for employers to make hybrid working a success rather than rushing to return employees to workplaces and previous ways of working. 

If the cloud can support a new hybrid working model where employees are highly motivated and productive, there’s every reason for SMEs to increasingly look to the cloud in the future. As SMEs look to embark on digital transformation in a rapidly changing economic landscape, capitalizing on efficiencies and making smart technology investments will be key. 

With the future of work changing rapidly, the cloud has been an important pillar used to encourage and increase communication, while also streamlining collaboration. With a considered, well-researched approach, SMEs are better positioned than ever to see increased productivity and new opportunities emerge as the cloud becomes more mainstream in their business models.

Matt Crook, MD, Wolters Kluwer Tax & Accounting UK

Matt Crook is the Managing Director for Wolters Kluwer Tax & Accounting UK. Widely regarded as a business transformation specialist, Matt is responsible for the strategic direction and operational excellence of the UK business.