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Global digital transformation spending reached $2.5 trillion in 2024 and is on pace to reach $3.9 trillion by 2027, according to the International Data Corporation (IDC), which points to investments in artificial intelligence (AI) and generative AI (Gen-AI) pushing investments.
How can small business owners manage this rapid pace of digital transformation? We talked to three local leaders in Rochester’s data and IT space to find out.
“First, take a breath; you’re not alone,” said John C.S. Loury, president of Rochester-based Cause + Effect Strategy, to small-business owners. “Companies of all sizes are trying to deal with the challenges related to the pace of digital transformation.”
Loury, whose company is a provider of data and analytics consulting services, stresses that this pace and rapid introduction of Gen-AI into the conversation has many business owners and leaders of all sizes anxious and feeling like they’re behind or not doing enough to modernize or transform their businesses.
“After taking a breath, the first step is to develop a plan or strategy for your business that focuses on the different functional areas and using the lenses of people, process and technology,” he said, explaining that it’s helpful to look at the functional units of your business, like marketing and operations, through those three lenses. “Once you’ve done that, you’re able to extract where you see some gaps and that’s where we want to focus first.”
This honest assessment of where your business is from a digital maturity perspective and breaking the transformation down into small, more easily digestible pieces is key to knowing where to go.
“Then, the third piece is to seek out local partners who can help you, guide you, or add to your knowledge base,” Loury said. “You don’t need to work with a huge consulting firm to bring up your knowledge base when it comes to some of these different tools, technologies, or processes. There are local companies that can help and especially upskill your team.”
Finally, Loury says business owners need to tactically choose the area to focus on the most, which can sometimes seem daunting to small businesses.
“Bigger budgets don’t guarantee greater success,” he said. “So just because you’re not a publicly traded company and you don’t have millions of dollars to be able to dedicate to digital transformation does not mean that you can’t be extremely successful.”
Being small and agile can work in a business’s favor when it comes to changing processes and implementing new technologies.
“Really focus on making incremental changes that positively impact your business and not chasing trends or buzz terms,” Loury said. “Identify opportunities to reduce infrastructure with cloud-based tools and look for opportunities around automation. If you’re a smaller team the idea of adopting tools and technologies that can help make you more efficient and get more done makes you seem like a bigger team.”
Fred Brumm, co-owner of CETech, a Rochester-based IT services and consulting firm, says that while every business owner’s situation is different, success in handling rapid digital transformation begins with having a change mindset.
“Learning anything new can be frustrating,” Brumm said. “To keep up you have to get a little bit out of your comfort zone and be willing to spend some time to learn about it. You don’t have to necessarily be the ‘doer,’ but you have to have that mindset of wanting to change and keep up.”
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When thinking about a new technology Brumm suggests starting small and then scaling. For example, begin by focusing on improving your customer’s experience. This can get you some quick wins and build your confidence to use technology in other ways.
“Also don’t be afraid to ask for help or find an outsourced provider,” Brumm said. ”Our biggest wins are working with companies to help them with their technology needs and see their projects through to success. That’s what we love to do.”
David Wolf, vice president of Just Solutions, Inc., a provider of managed IT services with offices in Rochester and Buffalo, acknowledges the rapid pace of digital transformation can be taxing on small businesses without support.
“Small business owners are dealing with a lot,” said Wolf, when it comes not only to their day-to-day work but ever-changing technology. “They’re dealing with the end of the life of Windows 10, and they’re being forced to Windows 11 and they’re thinking about how to leverage AI.”
He believes strongly in tech education from a myriad of different sources, including webinars, trade associations, and local organizations like the Rochester Technology and Manufacturing Association, Monroe County Finger Lakes APEX and chapters of the Chamber of Commerce.
“ I think that’s important for people to realize that they’re not in it alone and whatever they’re trying to do for their business there is a lot of good help out there,” Wolf said. “SBA SCORE has coaches and advisors and they’re free. There’s a lot of support through different agencies.”
He also recommends free training offered by manufacturers but cautions not to be rushed or pressured into making a technology purchase.
“Not making a decision and postponing a decision is a decision,” Wolf said. “If you’re saying, ‘I don’t understand it yet’ or ‘I’m not fully committed to it yet,’ that’s okay.”
He also cautions against long-term contracts/subscriptions and encourages seeing demonstrations and having access to a trial on things like software before making a large investment.
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