Connectivity bottlenecks put $182bn in SME digital transformations at risk

Research finds ‘alarming’ gap between the approaches small businesses are taking in their post-pandemic digital transformations

Of all the approaches that firms have taken to address the new normal of the post-Covid environment, implementing software-defined wide area networking (SD-WAN) has been among the most popular and effective – but research from Techaisle, commissioned by Big Leaf Networks, has revealed a widening gap between the approaches small businesses are taking in their post-pandemic digital transformations.

In Thriving in the ‘next normal’: Digital transformation, post-pandemic business success and the importance of SD-WAN, the global IT market research and analyst organisation surveyed and interviewed IT leaders to understand the challenges that small and medium-sized enterprises (SMEs) face and how they can successfully prepare themselves for the “next normal”.

The study revealed that US SMEs were on track to spend $268bn on technology in 2021 and out of a total of 5.4 million commercial SMEs, 68% were actively investing in digital transformation technologies and 55% had accelerated their investments in digital technologies.

Techaisle noted that SMEs that had an established holistic approach to digital transformation were achieving higher growth and profitability than those that approach digital transformation as individual initiatives.

Indeed, SMEs that were using SD-WAN were more advanced in their digital transformation status than those that still relied on older-generation networking technologies. The report said SMEs that were holistic or inclusive in their approach to digital transformation were 232% more likely to be using or actively planning to use SD-WAN than their less advanced peers. Within two years, 56% of mid-sized businesses in the US will have deployed SD-WAN, it said.

One of the most important findings in the report was that network unreliability, resulting in failing applications and lack of adoption, was a clear pain point for SMEs as they aligned their businesses with the emerging requirements of the post-pandemic world.

Connectivity is a critical link in unlocking digital opportunities and potential, and nearly 90% of SMEs in the study were found to believe that proactive, consistent network management aimed at delivering ideal performance was either “important” or “very important”. But despite its importance, connectivity-related issues were revealed to take up almost half (47%) of an SME’s IT time.

“Networks consume scarce IT resources,” said Techaisle’s Anurag Agrawal. “What we learned is that small business owners must proactively embrace digital transformation to support their new digital business practices, which comes with its own challenges. The good news is, many SMEs are also discovering there are technologies like SD-WAN that can help them address these challenges.”

Joel Mulkey, founder and CEO of Bigleaf, added: “The pandemic made it clear that businesses’ ability to survive and thrive relies on their agility, resiliency and ability to keep their teams connected and to connect with customers, suppliers and the world at large. SD-WAN turns the network into a business asset, with the ability to realise cost savings, enable innovation, and provide better support for business-critical cloud connections.”

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