Politicians and the press love to fuel the idea that it’s possible for a small outfit to take on the giants in their field and win. They often talk about how small businesses are often the backbone of American enterprise. This is a popular theme that buoys votes or subscriptions.
However, the reality of the marketplace is far different from these rosy projections. In many markets, big businesses crush small businesses. In fact, the life expectancy of a small business is estimated to be less than four years, with many not making it past their second year.
Small businesses fail for many reasons, but two of the most common reasons are insufficient resources and inexperience. Small businesses are often undercapitalized and don’t have the money, people, equipment, or connections to become serious contenders. On top of this, the founders may lack the business skills necessary to run a successful business.
The Difference that Makes a Difference
Does this mean that small businesses have little chance of economic survival? In most cases, “yes.” In some rare instances, “no.”
The small businesses that do manage to do well, eventually growing into mid-to-large businesses, have managed to do two things well. They have managed to earn more than they spend, and they have managed to run efficient business processes.
The one thing that these businesses do is leverage technology to minimize the market disadvantage big businesses have over them.
3 Technologies that Level the Playing Field
The right technology can make a world of difference when working within the confines of a small budget and limited manpower.
Here are three technologies that can potentially level the playing field between a small business and other larger businesses in their field:
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1. Software for Business Operations
Good software can save time and money. It can simplify complex processes, and it can automate tedious tasks that would consume hundreds of hours of human labor.
The quip “There’s an app for that” is often a life raft for a small business owner. For instance, there is software to make accounting easier for non-professionals, to collaborate the efforts of a network of outsourcers, and to get things done on time and within budget when managing a project.
There is even software for creating binding contracts. Since business transactions are run on mutual agreements, signatures are an essential aspect of doing business. However, collecting signatures is often a frustrating facet. In many instances, appointments have to be made, business trips planned, and schedules coordinated to get two busy people in the same room to sign off on a contract.
In fact, signatures are so essential to politics and business that many TV news channels often show heads of states or corporate leaders signing a document in a conference room as a major news event.
Enter the esignature, a legally binding electronic signature made on a paperless document. And it’s as easy as using the right software and sending documents back and forth through emails or website downloads. It’s now no longer necessary to arrange time for two parties to meet in person for a contract to be signed.
2. Software for Business Processes and Systems
Technology makes it much easier to run business processes and systems. Although the two terms are often erroneously used interchangeably, they are two distinctly different aspects of a business.
A business system is a series of processes that are designed to get a specific result. It’s the interrelationship of different components working in harmony to achieve the good of the whole. When there is a business system in place, it’s possible to acquire consistent and measurable benefits. A process, by contrast, is a subsystem. It’s one chain of events within a system.
For instance, a lead generation system consists of a landing page, an opt-box, a one-time offer, and a series of follow-up emails. A lead generation process would be one aspect of this system. For instance, it might be all the conversion elements placed on a landing page to persuade them to share their email in exchange for a valuable free report.
Using technology, it’s possible to simplify and automate business processes and systems.
3. Hardware and Software for Business Infrastructure
Cloud computing and video conferencing are examples of technology that sharply cut costs while expediting business efficiency. Cloud computing makes it unnecessary for a business to build its own computer system and network. Video conferencing makes it unnecessary for two business heads or business teams to meet in person because they can transact or negotiate through the medium of a live video interaction.
Technology Rekindling Hope for Small Businesses
Business lore is filled with David-and-Goliath stories about how many small businesses started from humble beginnings.
In the technology industry, for instance, we’re all familiar with how Steve Jobs started Apple Computers out of his family garage and Michael Dell started Dell Computers out of a college dorm room.
These stories fuel the entrepreneurial vision of startup founders. “If they can do it, I can do it,” becomes their mantra. They believe that with enough hard work, ingenuity, and sheer good luck, they can rise to great heights of success. These pipe dreams did not have much chance of success before the introduction of business hardware and software. In the past, most small businesses were built on hope more than any practical ways to succeed.