A new study by SAP SE (NYSE: SAP) has found 84% of SMBs in Australia are confident in their growth over the next 12 months despite workforce volatility, including the Great Resignation, having directly impacted the digital transformation plans of 89% of SMBs.
What were the insights of SAP’s research?
These insights have been revealed in new SMB research study released, Transformational Talent: The impact of the Great Resignation on Digital Transformation in APJ’s SMBs’, which explores the impact of the Great Resignation on Australia’s SMBs and their growth plans.
Optimism abounds as SMBs move from resilience to focus on growth
Having managed significant challenges over the past two years, SMBs in Australia are looking beyond a focus on resilience. Two-thirds (66%) of Aussie SMBs say their firm is highly or fully resilient in weathering the pandemic’s impact. Not one respondent said they are not resilient at all. That confidence has resulted in a feeling of optimism about their growth prospects.
That mindset can only be a positive thing for Australia, according to Sofiane Ainine, SMB Segment Lead, SAP Australia. “Our SMEs are a bellwether for the wider economy. I believe that when SMBs thrive, economies grow, and Australia prospers,” commented Ainine.
“By harnessing optimism and putting it together with innovation, a commitment to talent, and a strong partner ecosystem we can chart a course to the next decade of SMB success.”
The impact of the Great Resignation on SME digital transformation
Despite this optimism, businesses now face another challenge – the ‘Great Resignation’. Coined in 2021, the phrase refers to a worldwide trend of millions of employees leaving their jobs. SAP’s study found the Great Resignation is real and impacting SMBs in Australia today.
Almost half (48%) of the survey respondents agreed that more employees are resigning now compared to just 12 months ago, while 57% of SMBs said they are not finding it easy to cope with the impact of the Great Resignation. This is critical, given 94% of SMBs say digital transformation is very important to their organisation’s survival over the next year.
The talent crunch is impacting firm’s ability to digitally transform. In fact, lack of skilled talent trails only understanding of available digital solutions as challenges to achieving successful transformation for Aussie SMBs, ahead of obstacles like cyber security or lack of budgets.
“This study reveals how the Great Resignation can be seen as an existential threat to many organisations. Digital transformation is a fundamental way small businesses not only build resilience, but how they create agile, innovative paths to growth. But without the right people, any transformation will struggle. Investment in talent must match investment in innovation to ensure SMBs in Australia both survive – and thrive,” commented Mr Ainine.
Investing in talent and training to mitigate the Great Resignation
SMBs in Australia are investing in their workforce to mitigate the effects of the Great Resignation and to bolster their organisations’ ability to deliver digital transformation.
Respondents said they were focusing on introducing flexible working arrangements (45%) and improving financial incentives (39%) to boost talent retention over the next 12 months. Yet, beyond those strategies, SMBs are also focusing on training. Over a third (36%) of SMEs said they would provide upskilling opportunities to retain key talent in the next 12 months.
The focus on training can’t come too soon. Over half (55%) of SMBs say upskilling to support digital transformation is urgent, leading to 82% of Australian SMBs who will focus on digital training throughout this year. “The Great Resignation has often been misconstrued as employees leaving to pursue their purpose. That’s not the whole story,” said Mr Ainine.
“Talent requires the right remuneration, flexibility, and a clearly communicated progression journey. Prioritising upskilling and career progression, and supporting it with access to the right tech and partners is proven to be a win-win for employees and for SMBs in Australia.”
The full report of Transformational Talent study is available for download here.