A new survey conducted by market researchers Amárach paints a mixed picture of investments in digital technology by Irish businesses.
The survey, commissioned by Huawei Ireland as part of its new Digital Business Index, found that while larger firms and corporates were upbeat about digital technology, its potential and their investments in it, reporting an ‘index score’ of 74.4, small businesses hit only 43.4 on the same scale.
How this can play out can be seen in a number of areas, but adoption of generative artificial intelligence (AI) is a particularly instructive one given it is the technology the markets are betting on as the next big thing. The Index found that, in Ireland, 35% firms surveyed did not utilise generative AI in any aspect of their business, and a similar proportion ‘do not intend using it’. However, this rose to more than half (52%) of micro firms – those with fewer than 10 employees.
Another finding was that the business-to-business sector is engaging with digital transformation not so much to cut costs or find new opportunities but to avoid ending up having to explain themselves to regulators or, worse, the courts.
It appears that the sector sees digital transformation not as a brave new world but something to be endured: “growing revenues is well down the list […] B2B firms are more likely to identify regulation as a driver of digitalisation than B2C firms,” the Index found.
Meanwhile, the main barrier to investing in digital technology across businesses of all sizes was cost: 43% of respondents cited a ‘lack of budget or financial resources’ acting as a drag. Lack of knowledge also came high at 35%, suggesting the tech skills shortage continues unabated.
Commenting on the results, Calvin Lan, Huawei Ireland’s chief executive said that one way to move forward would be for those large enterprises that are already ahead in digitalisation to assist small firms, which they presumably count among their suppliers and customers.
“While smaller and micro firms show lower confidence in digital investments facing more challenges with digital transformation and technology adoption. Larger companies need to play a supporting role through education, awareness and engagement whether that is webinars, workshops or free cloud credits to boost digital adoption among micro firms, so that they are not left behind which will, in turn, will lead to a strengthening of the broader economy,” he said.
In the meantime, though, it is worth considering that this mismatch is significant because, as previously noted by TechCentral.ie, the vast majority of Irish businesses are small. Indeed, the Central Statistics Office’s Business in Ireland report shows that 99.8% of Irish businesses are SMEs.
Those that choose not to digitise may have perfectly fine reasons for doing so, and throwing money at IT has never solved any problems, business or otherwise, but the reality is that technology has changed, and is continuing to change, the world. Businesses that lack the resources to keep pace – and many small businesses are already engaged in a Sissyphean struggle – could well find the coming years to be more terrifying than challenging.
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