Small businesses around the world are turning to efficiency in their search for growth, according to a new survey from The Economist Intelligence Unit (EIU).
Released this week, the survey finds that over the next 12 months, the top two strategic objectives for small and medium-sized businesses (SMBs) will be revenue growth and operating efficiency.
Moreover, the survey shows a close link between growth and efficiency: For more than half of the respondents (55 per cent), the main driver of planned efficiency improvements will be to expand the business - much more so than reducing costs (24 per cent) or reducing complexity (12 per cent).
The survey found that nine in 10 SMB owners and managers recognise they can improve efficiency - with about half (52 per cent) being unhappy with the state of efficiency at their company and a similar number (53 per cent) finding it a struggle to resolve these inefficiencies. Only half of these respondents believe that their company has made good use of the struggling economic climate to become more efficient.
The chief methods being employed by companies to achieve this 'smarter growth' are teaching employees to work smarter, followed closely by technology upgrades, both of which are being implemented by more than half of respondents. But as these owners and managers strive to tackle inefficiencies within their organisations they must first overcome resistance to change, which is cited in the survey as the biggest internal obstacle to making improvements to the business.
"Periods of rapid growth can be intoxicating for small businesses, but creating an efficient growth platform is important if they are not to struggle later," says Denis McCauley, Editorial Director, EMEA, at the EIU.
"This is why SMBs' orientation toward investing in efficiency as a means to help grow the business, evident in this survey, is encouraging."
The survey also found that firms which focused on efficiency from the start tend to be in good stead later.
SMBs that have been in business longer tend to also struggle with their internal operations more than younger businesses do.
Nearly three in five (59 per cent) SMBs that have been in business for over 10 years admit to having difficulty tackling inefficiencies, compared to less than half (46 per cent) of SMBs that have been in business for less than 10 years.
It was also found that nearly all SMBs (91 per cent) have seen technology-driven improvements to their business during the last 12 months.
Nevertheless, more SMBs are planning to upgrade existing infrastructure and systems over the next 12 months rather than invest in new and untried technology. One explanation for this cautious approach is a lack of IT skills or know-how within the business, which respondents identified as the second biggest obstacle to improving efficiency.