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Technology-Supported Growth for SMBs By Steve Ernst, CPA  As
we wind down the calendar fourth quarter, CPAs who serve small and
midsize businesses (SMBs) are refresh their knowledge of accounting
standards and financial reporting. They are solidifying their ideas
on matters related to risk assessment, scope, depth of review, relationships
between their clients' accounting policies and GAAP... in a word,
they're strategizing.
In better-managed, growing SMBs there is also an element of management looking to the future, planning, plotting, thinking ... in a word, strategizing. Over the years, the SMB has heard promises of technology that would fit their scale, grow with them and support the strategizing efforts for future initiatives. At the same time, very few SMBs actually incorporated or even attempted to use technology for the purpose of supporting and facilitating growth. In effect, the small business executive didn't believe the promises, and didn't risk the investment and the expensive disappointment. It is time to reassess the assumption that technology can only help you look to the past – at best allow you to see yesterday in detail without regard to tomorrow. Companies using technology like that and accepting it are minimizing their growth opportunities, if not forgoing them altogether. Solid, sustainable growth, both in the top and bottom lines, comes from a number of factors. However, I contend the primary factor, especially for the SMB in today's increasingly competitive and global economy, is taking advantage of potential threats and turning them into competitive advantages. The key is how to use technology to identify and utilize these opportunistic situations. Data shows that a majority of companies – 55 percent – fail within the first four years of existence. Of the surviving 45 percent, a quarter will fail within the next four years. Ultimately, data indicates that within 10 years, 80 percent of businesses fail, are absorbed or flee to another line of business altogether. Growth, therefore, is as much about survival as anything. Where to start? Let's start at the bottom. Let's start at the receiving dock and then go to the shop floor, the cooling cellar, the grain elevator, the tool shed, the machine shop. Then go to the warehouses and the offsite storage facilities. Then let's go to the picking and packing area and the outbound loading dock. We'll hop over to the accounts receivable and accounts payable areas and we'll then proceed to areas, where you do R&D, and we'll visit the lawyer who handles your intellectual capital matters and maintains the IP-related records. Finally, let's assume that you're like most SMBs and all of the above reside in just one or maybe just a few buildings, all the functions are being handled by a small core of employees or key professional service providers, and all of this important information is not organized, not collated, not cataloged ... ever worse, you have no idea where it is. This inhibits your growth. You are lacking the thread of information availability. The integration of processes and systems that allows you to know where the information is, who's responsible for it and who has access to it is a crucial element in allowing a small business to grow and sustain that growth without toppling itself due to a lack of systemic control supported by the right technology. Those SMBs that are growing and maintaining control and confidence have realized that, in the last four to five years, the once-doubted promise that there are technology solutions out there designed for a small business, priced for small business budgets and flexible enough fit various company profiles can now be taken to the bank both figuratively and literally. |
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