SMEs are well connected but slow to take full advantage of the Internet and ICT

0 October 31, 2011

Canadian SMEs are now well connected to the Internet, but are not taking full advantage of the Web and information and communications technologies (ICT) to increase their productivity and their revenues.

These are the main conclusions of the 2011 edition of the NetPME survey conducted by CEFRIO. The aim of the survey, which is now in its fourth edition, is to determine how much SMEs use ICT in their business practices. The survey, which was conducted exclusively in Quebec in the past, was expanded to cover the entire country in 2011, due to the financial support of Business Development Bank of Canada (BDC). The results were unveiled to the members of the Board of Trade of Metropolitan Montreal, meeting during Small Business Week®.

“The impact of ICT on SME productivity, innovation and competitiveness is now recognized as very real,” said Jacqueline Dubé, President and Chief Executive Officer of CEFRIO. “In a globalized economy, where competition is getting more intense all the time, we need to see whether our SMEs are capable of making the best use of ICT.”

The survey shows that 92.8% of Canadian SMEs are now connected to the Internet. More than 59.3% have mobile devices such as smart phones or digital tablets, while 40.1% have none.

In the past twelve months most SMEs (88.3%) have made investments in ICT. Purchases of computer equipment (77.8%) and licenses (40.5%) are the most frequent investments.

Little use of management software packages
Few companies use management software packages. One quarter of the companies surveyed have computerized their processes by using an enterprise resource planning (ERP) software package (24.9%) or a customer relationship management (CRM) system (23.9%). Only 12% of these companies have a supply chain management (SCM) software package.

The CEFRIO survey showed that ICT is clearly better rooted in Canada in medium-sized companies (100 to 499 employees) and, to a large extent, in manufacturing companies. These companies have the highest Internet connection rate (97.6%) and make the most use of office suites (92.3%), ERP management software packages (34.4%) and websites as Internet tools (78.2%). SMEs in the manufacturing sector also use Open Source software the most (36.3%), as well as collaborative tools such as email (95.2%), project management tools (36.5%) or shared editing tools (40%).

“The SMEs that succeed best and conquer new markets are often on the cutting edge of technology. Some management software can be used as powerful tools for business growth, for example. That is why the Board of Trade is organizing Small Business Week® with BDC: to make small and medium enterprises familiar with the resources and tools available to them and to demonstrate the importance of innovation,” added Michel Leblanc, President and CEO of the Board of Trade of Metropolitan Montreal.

“The costs of these products have decreased, so it becomes very advantageous for SMEs to acquire them,” said Michel Bergeron, BDC Vice President, Corporate Relations. “In a context where companies must always do more with less, more SMEs should consider adopting such tools.”

SMEs slow to take advantage of selling online
In 2011, 70.9% of SMEs made online purchases. Selling online is a much less popular activity, because only 17.9% of SMEs engage in it. Despite the major development of Web 2.0, SMEs have not yet been won over by social network applications, as only 15.2% incorporate them into their marketing strategies, 14.3% apply them internally with their employees, and 17.5% use them with partners and suppliers. Those that engage in these activities use Facebook (60.9%) and the LinkedIn network (32.9%) more often.

“Since we know how much the Internet and Web 2.0 can contribute to increasing a company’s revenue and profitability, it is clear that SME executives have every interest in further exploring the opportunities these platforms offer their companies. If they do not take action in this field, they risk losing out on a major potential for growth and innovation,” Michel Bergeron concluded.

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