Legacy technology solutions see Kiwi mid-market businesses lose millions per year
26 Aug 2021
- Kiwi employees wasting an average of 12.5 hours each week on manual or repetitive tasks due to ineffective digital solutions
- For businesses with 100 employees, this is at an extra cost of roughly $2.2m per business, per year
- Businesses with future-fit business management platforms and practices grow 3.2x faster than their industry peers.
Kiwi mid-market businesses are losing up to a day and a half of time per person, per week due to ineffective technology solutions, according to a new study released today by business management platform, MYOB.
The commissioned trans-Tasman study, conducted by Forrester Consulting on behalf of MYOB, revealed an average of 12.5 hours per employee is wasted each week (75 working days per year) on manual or repetitive tasks, at an extra cost to each business of roughly $2.2million (NZD) per year.
MYOB Head of Customer Service – Enterprise, Jo Tozer, says the new insights support recent findings from the Productivity Commission which highlighted New Zealand’s falling productivity growth rate, and are a direct result of a heavy reliance on out-dated legacy technology.
“New Zealand businesses have been through some challenging times over the last 18 months. Now, understandably, the current focus is on revenue generating activity - but this is precisely what businesses are missing out on by letting inertia take hold when it comes to upgrading their business and people management solutions.
“With 41% of local mid-market firms we polled saying that a lack of prioritisation in the business was holding them back, these findings demonstrate that leadership needs to create the time and space to work on the business, rather than in it. To drive real change, businesses need leaders with a clear vision and a desire for action in order to inspire their employees to think differently about how they get the job done and what more they could achieve if they weren’t bogged down in manual processes,” she explains.
“We believe the findings show that many leaders are unaware of the very real link between their operations software and achieving business goals, so senior decision-makers must take charge and illustrate how the wrong digital solution can waste time, negatively affect sales growth, result in extra costs and create poor customer experiences.
“Too many New Zealanders are currently working harder, not smarter and it’s costing businesses significantly. This is an area that has just as much of a commercial case for business change and investment as any other area does,” concludes Ms Tozer.
The new study commissioned by MYOB also captured the current state of play when it comes to legacy software use by New Zealand mid-market businesses, and the findings revealed:
- More than a quarter (27%) of local businesses surveyed have been using finance and accounting solutions that are five to 10 years old
- Nearly one-in-five (18%) local businesses surveyed have been using workforce management solutions that are more than five years old
- 21% of local businesses surveyed have been using project management solutions that are more than five years old
- More than one-in-10 local businesses surveyed (12%) have been using employee onboarding and/or employee management tools that are between five and 10 years old
Jo explains that with the potential boost modern solutions offer when it comes to enhancing operational efficiency, there’s little reason for local mid-market businesses to settle for the status quo.
“If businesses really want to succeed and gain competitive advantage, then it is critical that they adapt and invest in technologies to future-proof not only productivity, but also profitability. As it stands, 63% of businesses across New Zealand and Australia admit their systems have held them back from taking on larger customers, and this is another negative outcome from siloed or legacy solutions that is hitting their bottom line.”
The latest findings also showed that in addition to the loss of potential new customers, New Zealand organisations surveyed also believe that more than a quarter (27%) of their extra costs are being incurred because of inefficient or ineffective business and people management solution capabilities.
“Mid-market businesses need modern solutions that are primed for the fast-changing nature of modern commerce. These solutions need to deliver on agility and innovation, to not only drive cost efficiency, but support growth and expansion ambitions,” adds Ms Tozer.
“With additional insights from Forrester highlighting that businesses using future-fit platforms and practices grow 3.2 times faster than their industry peers, and 42% of local businesses in our study recognising a positive impact on employee productivity within six-to-12 months of adopting a modern people or business management solution, the case for change couldn’t be clearer,” she concludes.
To download a copy of the study - “Seizing Advantage: The technology pivot ANZ businesses must make” – which looks into mid-market firms and the case for unified solutions, visit: www.myob.com/seizing-advantage