In life, the more mature you are the more likely you are to be successful.
For the Business Development Bank of Canada, the same can be said for small-to-medium sized businesses.
Recently, the BDC announced it was making $250 million in funding available for businesses that want to become “digitally mature” and invest in technology.
“What we realized is that the culture is as important as the money you invest. The culture is not only to have a website, but what kind of value are you going to bring to your consumer. And, how does this fit in your business model,” said Pierre Cleroux, chief economist with the Business Development Bank of Canada.
The BDC surveyed 2,000 companies across Canada – all sizes and sectors – and found those with higher digital maturity also had higher sales and higher profit growth.
“Businesses that are digitally mature, they perform better,” he said.
Atlantic Canada’s digital maturity, based on the survey results, was 15 per cent while the Canadian average was 19 per cent.
Companies that are digitally advanced are involved in areas like online marketing and sales and consumer data collection that inform changes to marketing strategies. At the other end of the spectrum are companies that don’t have a website.
Cleroux said manufacturing and construction are the least digitally mature sectors whereas retail and business-to-business transactions ranked the highest.
Erin McGrath-Gaudet, P.E.I. director for the Canadian Federation of Independent Business (CFIB), said the BDC has a point about the need for new technology – as well as new equipment, training and more efficient processes – to improve productivity, especially as labour becomes scarce as baby boomers continue to retire.
“That’s going to be a really big, defining trend over the next 10, 15, 20 years – how do we continue to be producing goods and services and how do we continue to grow our economy and businesses in an era where labour is going to be less available?”
She said becoming digitally mature can come at a cost, and business owners need to decide whether adopting the new technology is worth it and whether they can recoup the costs of the investment.
McGrath-Gaudet said small-to-medium sized business owners on the Island tend to fund investments with their own profits rather than through a program.
“You have small business owners who are working 70 hours a week. To then go on top of that… and to go through an application process and to wait maybe a couple of months to see if you’re approved — there’s a lot of red tape that goes along with accessing those types of programs.”