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Small businesses across Australia and New Zealand are facing one of their toughest periods in decades.<\/p>\n
A flat economy and shifting consumer behaviour have put pressure on already thin operating margins. A 2024\u00a0survey<\/a>\u00a0by business finance company ScotPac found 29% of Australian small businesses say they could face insolvency if they lose a major client.<\/p>\n Accounting organisation CPA Australia\u2019s latest\u00a0small business survey<\/a>\u00a0shows only 48% of New Zealand\u2019s small businesses grew in 2023. This is significantly down from 60% in 2022. There have also been a record number of business liquidations in both\u00a0New Zealand<\/a>\u00a0and\u00a0Australia<\/a>.<\/p>\n Yet some small and medium-sized businesses are thriving. Part of the reason for this is because they have embraced the concept of \u201cdigital leadership<\/a>\u201d.<\/p>\n This is the ability to strategically integrate digital technologies \u2013 such as artificial intelligence, cloud computing, data analytics and automation \u2013 into a business\u2019s operations, decision-making and long-term vision.<\/p>\n Digital leaders use emerging technologies to improve efficiency, redesign business models, scale operations and reach new customers in ways that wouldn\u2019t be possible otherwise.<\/p>\n Our review of the research on digital leadership, recently published in\u00a0Digital Leadership and Contemporary Entrepreneurship<\/a>, found that firms treating digital leadership as a core business strategy, rather than just using technology for isolated tasks, are the ones that successfully scale, grow and future-proof their organisations.<\/p>\n Without this change in mindset, firms risk stagnation and missed opportunities. That difference is critical in an economic environment where small margins separate thriving businesses from struggling ones.<\/p>\n It\u2019s easy to assume\u00a0small businesses lag in digital adoption<\/a>\u00a0because of costs or technical complexity. However, most of the studies we reviewed suggest the real issue is hesitancy at the leadership level.<\/p>\n Some business owners are risk-averse and take a \u201cwait and see\u201d approach. Others believe their current solutions are sufficient even when new technology could improve efficiency.<\/p>\n A 2021\u00a0survey<\/a>\u00a0commissioned by cloud accounting software company Xero, found fear of change, overconfidence in existing processes and decision paralysis are among the biggest barriers preventing small businesses from embracing digital solutions.<\/p>\n Even businesses that already use digital tools \u2013 for example, to manage their social media \u2013 often fail to go further and integrate technology into core operations such as supply chain management and automation.<\/p>\n The lesson is that simply adopting digital tools without a strategic plan doesn\u2019t lead to growth. True digital leadership requires businesses to rethink how they operate, compete and scale.<\/p>\n The firms making the most of digital transformation embed technology in their core strategy. They use data-driven decision-making to refine products, forecast demand and identify new opportunities.<\/p>\n They streamline operations by automating routine tasks, such as using AI-powered invoicing, chatbots for customer inquiries and predictive analytics for inventory management. This frees up time for strategic initiatives such as product development and market expansion.<\/p>\n At the same time, they invest in training employees to effectively use and adapt to new technologies. Perhaps most importantly, they take an experimental approach \u2013 testing, learning and adapting in real time.<\/p>\n Businesses that have successfully grown through digital leadership illustrate this approach in action.<\/p>\n Set up in 2016,\u00a0New Zealand-based investing company Sharesies<\/a>\u00a0fundamentally changed how everyday people access financial markets.<\/p>\n Traditional investment firms required large deposits and complex paperwork, excluding many potential investors. Sharesies took a different approach. The company designed a mobile-first platform where users could start with as little as $5. The company now has more than 650,000 users and NZ$3 billion in investments.<\/p>\n In Australia,\u00a0The Very Good Bra<\/a>, a sustainable bra company, used digital leadership to create a global, sustainable fashion brand without traditional retail infrastructure.<\/p>\n <\/p>\n <\/p>\n A post shared by The Very Good Bra – B Corps (@theverygoodbra)<\/a><\/p>\n<\/div>\n<\/blockquote>\nWhy some small businesses fall behind<\/strong><\/h4>\n
Embracing digital leadership<\/strong><\/h4>\n
Learning to thrive in the digital economy<\/strong><\/h4>\n
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