DURBAN - Two-thirds (67 percent) of South African small businesses struggle to source the right tech talent, according to research from the global small business platform Xero.
Despite struggling to hire, only 14 percent planned to upskill their existing team members to help close tech skills gaps.
Virtually every small business in South Africa has adopted technology they now rely on, with 97 percent investing in new technologies in 2019.
Adoption of cloud accounting leapt from 13 percent in 2017 to 61 percent in 2020, indicating that more than half of small businesses can now manage their finances remotely. Despite this, it is clear that many small businesses don’t have the right skills to support the shift.
Before the lockdown regulations, 61 percent of small companies planned to allocate a portion of their budget to tech training. However, as many SMEs had to make difficult staffing decisions during the lockdown, much of this money will have been redirected.
“It’s great to see small businesses embracing digital tools, but investing in technology is only the first step. Many small businesses don’t yet have the skills to match. We need a greater focus from government and technology firms on closing this gap, and helping small businesses develop the right skills to build back faster and stronger from this crisis,” said Colin Timmis, Country Manager at Xero South Africa and professional accountant
He added, “If you are struggling to hire external talent, focus on upskilling tech champions in your current teams. Even if your budget is modest, look at what skills you currently have in your organisation that can be built on, make use of free online training and ask for help".
When asked which skills gaps existed in their team, the biggest gaps that respondents reported were in:
- cloud computing (39 percent)
- programming and app development (33 percent)
- digital product management (12 percent)
- digital project management (10 percent)
- digital design (9 percent).
To try and close the gap, a little more than half (55 percent) said that they had invested in improving cloud and tech skills over the last year.
The findings are from Xero’s fourth annual State of Small Business report.
The report that was conducted earlier this year in partnership with World Wide Worx (WWW) and is based on responses from 400 small business owners and 200 accountants.
The research highlights the areas in which small businesses need support and their progress in digital adoption.
Other key findings from the research include:
- Over half (53 percent) of businesses found that adopting technology resulted in ‘somewhat big’ or ‘big’ increases to their profitability.
- A third (33 percent) of small businesses reported that they are finding it hard to keep pace with tech developments, despite good progress.
- More than two in five (41 percent) businesses indicated that they’re only just keeping up with technology.
BUSINESS REPORT ONLINE