SME Cloud Users Much More Likely To See Success

New SME research from MYOB has revealed small and medium businesses using the cloud are much more likely to experience positive financial and operational results. They are also more likely to expect such results in future.

One key finding was that those using cloud technologies for business were 53 percent more likely to see a revenue rise in the past year, indicating the rewards are waiting for those who are ready to embrace cloud computing.

MYOB commissioned independent market research firm Colmar Brunton to conduct a nationally representative survey of 1,000+ SMEs. Only 14 percent said they used the cloud for business. 79 percent said they did not use it and 8 percent did not know.

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Respondents’ gap in understanding of the cloud computing concept brings into question whether their sector’s information needs are aligned with the technology industry’s educational desires.

MYOB CEO Tim Reed said, “Despite the technology industry’s best efforts to teach others about the concept of cloud computing, our research shows a disconnect between SME cloud usage and their understanding of it. I question whether we need to rethink our educational direction when encouraging their move to the cloud.”

“Four in five say they don’t use the cloud for business. This is surprising given the prolific use of internet banking and email, to give straightforward examples. Many more business operators leverage cloud technology than give themselves credit for, they just don’t realise,” he said.

“The key to encouraging mass adoption of newer and more advanced cloud products and services is to advocate the productivity and financial benefits to a much greater extent than the technology behind it. Put simply, the cloud is already changing business for the better – it has been doing so for years – and is now providing access to even more powerful business tools that improve the way we work. It is really encouraging to see our research uncover the significant business performance results of those using cloud technologies in business. The mobility, flexibility and scalability benefits are life-changing for some people,” said Reed.

He continued, “Technology innovators and early adopters already get it; but cloud solutions are now ready for the mass market. Our clients and partners, many of whom already use cloud solutions, often tell me their main concern is how a technology will help them be more competitive and help make business life easier. I liken it to smartphones. Do most people care about how they work, or do they care about the business benefits a smartphone brings?”

Financial Benefits Of Cloud Usage

Reed said, “The advantages of using cloud computing for business came through loud and clear in MYOB’s research. We found those doing so were 53 percent more likely to see a revenue rise last year. 26 percent of respondents who said they were using the cloud saw a revenue rise, compared to 17 percent of those who said they were not using it.”

There were numerous financial and operational result wins for cloud users. They were also more likely to:

• Have more sales/work than usual in their 3-month pipeline: 55 percent versus 25 percent of those not using the cloud

• Intend to grow their number/range of products or services in the next year: 48 percent versus 24 percent

• Expect their revenue to rise in the next year: 44 percent versus 26 percent

• Intend to increase their prices and margins on products/services sold this year: 37 percent versus 25 percent

• Intend to increase staff numbers this year: 35 percent versus 15 percent

• Expect the economy to improve within 12 months: 34 percent versus 18 percent

• Record revenue increases in the last 12 months: 26 percent versus 17 percent.

Key Drawcards Of The Cloud

The most popular reason for respondents using cloud computing was the ability to access data from whatever location they wanted (42 percent) followed by being able to have their team members work remotely (28 percent). 26 percent said a major reason for their cloud usage was to reduce the number/range of IT issues they have to deal with personally, while 23 percent also said they used it because their data was better protected and safer online on external servers.

Reed asserted, “Cloud usage can provide a serious competitive advantage. Increasingly, businesses have teams on the road, in the office and working at home. The power of the cloud provides the freedom to work anywhere at any time, to be with your customers, partners and suppliers while still enjoying a connection to the office.”

“Plus, the secure gateway offered by trustworthy cloud providers means you can authorise others to access your business data as you access it. This eliminates the need to transmit data in physical forms to, say, your accountant or book keeper via CD, USB, email and other less secure means,” he said.

Key Barriers To Cloud Usage

SMEs not using cloud computing for business were asked why not, uncovering these top five mental hurdles:

• 27 percent said they did not know enough about the issues to make the right decision

• 26 percent were unsure of the safety in storing their data in servers overseas

• 22 percent said it is of interest, but there are more important other business priorities to take care of first

• 21 percent were unsure their data would be as secure on servers other than their own

• 17 percent said they were not tech-savvy enough to feel confident to even start looking at the issue.

Potential Cost Benefits To Customers

To find out whether potential cloud-related business cost savings could flow to consumers, MYOB asked, “If you could reduce your business administration costs in any way, how likely would you be to pass on the savings to customers?” – One third (33 percent) said they were quite likely (27 percent) or very likely (6 percent) to pass on savings.

Businesses Most Likely To Use Cloud

Across the survey’s many cross-breaks, business operators most likely to say they used cloud computing included:

• Generation Y (28 percent)

• Businesses with a website (23 percent)

• Those running start-up businesses (23 percent)

• Those in business, professional & property services businesses (22 percent)

• Metropolitan-based businesses (21 percent)

• Businesses whose revenue had increased in the last 12 months (20 percent)

• Sole traders (15 percent).