Canadian businesses would be wise to take a page from Billy Beane in Moneyball if they find themselves at a crossroad when it comes to embracing emerging technology trends: “Adapt or die.”
The Business Development Bank of Canada (BDC) kicked off Small Business Week with a new study that details six emerging trends that will fundamentally reshape Canada’s business ecosystem.
Out of the six, three are directly related to how technology is impacting the way every kind of business operates, from the implementation of virtual marketplaces to data analyzation. The point of the study is to ensure Canadians future-proof their businesses and remain competitive in a changing landscape.
At the launch of Small Business Week, Michael Denham, the CEO of BDC spoke about how new technology challenges should not be a purview, but rather the centre of business. Anything from AI to robots to advanced analytics should be what is driving business growth, and the difficulties will lie in attracting talent in a competitive landscape.
The report details that digital transformation is already well underway for businesses of all sizes, but it is the larger ones that are paving the way. Small businesses will need to catch up if they wish to stay in the race.
The BDC survey indicates that businesses that have embraced digital technologies have improved their customer experience by 49 per cent, boosted revenue growth by 34 per cent and enhanced efficiency through lower costs and better productivity.
The current rate of technology adoption could double by 2020, which is good news considering that less than one-quarter of companies with 20 or fewer employees currently use e-commerce platforms. That number could grow to 48 per cent by 2020.
The first technology trend BDC outlined is the growth of virtual marketplaces, and it relates directly to the statistics mentioned above.
“The rapid adoption of the Internet and mobile devices in Canada and around the world is completely changing the way consumers search for products, get recommendations, interact with companies and make payments,” the study says. “As a result, e-commerce is growing rapidly in Canada.”
At 57 per cent, more than half of the B2B purchasing process is done online before any kind of salesperson is even contacted. This grows even larger for regular consumers, as another BDC study found that 90 per cent of consumers visit a company’s website before making a purchase.
The power of these online platforms stems directly from a few different things, mainly the power of online reviews and borderless markets. Reviews can strengthen or destroy a business, as over one-quarter of consumers have reported changing their minds after reading a review. Personalization is also a key factor that can give businesses with an online presence the leg-up.
Providers like Shopify have made billions by providing smaller businesses with a place to create their own virtual marketplace, even holding competitions to push these smaller companies to their absolute limit.
One of the most important trends, especially in Canada lately, has been the integration of AI and machine learning into any kind of business platform. Whether it be banks or advertising, automation can streamline multiple aspects for a business and allow them to more easily scale and adapt.
Canada actually lags behind other advanced economies in terms of automation, ranking twelfth in terms of robot density in the manufacturing industry. But automation is not only about robotic assembly lines, as digital offerings like CRM and ERP also factor into how well a business uses automation. BDC cites a McKinsey Global Institute report, saying that half of today’s work may be automated by 2055, or even 2035 if market forces allow.
What happens often for larger companies is the adoption of new technology through partnerships or acqui-hires. TD Bank recently agreed to bring on conversational AI platform Kasisto, and Zoom.ai bought SimplyInsight to advance its own virtual assistant.
“The future of AI lies in leveraging that technology to boost the quality of human engagement,” said Zoom.ai CEO Roy Pereira in reference to the SimplyInsight purchase. “This acquisition will help to add a deeper, data-centric element to our product to better serve and address the growing demands of the modern enterprise.”
The Rising Economy for Data
“Data is the new oil,” as The Economist famously professed, and companies must begin tracking and using the new commodity to ensure customers are getting what they want, when they want it and exactly how they want it. Everything from loyalty card data to production line data must be collected and disseminated in order to bring a business into the future.
Cloud-based software and the growing presence of IoT devices can allow companies to automate data collection in every aspect of their business. The number of devices connected to the internet will grow to 75 billion by 2025, a fourfold increase from right now. With more connection comes a better understanding of the way companies organize and utilize business insights.
Another great source for finding customer data can be social media. Facebook can help small and medium-sized businesses scale through targeted advertising and the collection of customer trends.
Adapt to Future-Proof
Along with the three emerging trends rooted in technology, BDC outlined three others that businesses must adapt in order to grow.
Aging and retiring baby boomers will put a drag on growth resulting in an overall decrease of the general talent pool. Millennials and Generation Z members will account for half of the workforce by 2020, meaning business owners will have to manage multiple generations with varying skill sets. Finally, by 2032, immigrants will account for up to 80 per cent of Canada’s population growth, resulting in an incredibly diverse workforce.
In order to future-proof any kind of business, companies must look at these six trends and adopt them as soon as possible.
The BDC’s full report is available for download here.