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Avoid the sugar high: Making the most of the government's SMB digital sweetener

By Contribution
Wed 8 Jun 2022

Article by Nutanix A/NZ managing director, Jim Steed.

With the federal election now behind us, small-to-medium businesses (SMB) in Australia still face the same challenges and opportunities they did just a few weeks ago.

In the pre-election budget, SMBs were the major winners with a range of initiatives to increase digital capabilities, uplift local skillsets, and make it easier for SMBs to do business. Many of these programs enjoyed support from both sides of the aisle. 

While all the stimulus measures are important, the small business technology investment boost is particularly potent as it has the potential to transform SMBs in the long term.

When digital is increasingly the default method, SMBs enjoy a bonus 20% tax deduction on expenses that support digital adoption until the end of the next financial year.

This gives local SMBs the perfect opportunity to set themselves up and digitise their businesses. However, to make the most of these incentives, there are a few pitfalls to avoid and lessons to be learned from mistakes larger enterprises have made on their own digital journeys.

Avoid the sugar high

Perhaps the most important thing SMBs can do is take a long-term view of how they want to operate. With strategic investments today, businesses can greatly accelerate the journey to their desired future state.

One thing to consider, particularly when it comes to cloud computing, is how today’s investments will stack up three years from now when the budget support evaporates. 

Once the decision has been made to shift to a cloud operating model, the next questions SMBs need to ask are how do we make the move, how long will it take, and can we accurately predict the budget? 

The hyper-scale public cloud providers make it very easy to move data and applications into their environment but incredibly difficult to move them out afterwards. This has led to a phenomenon in the enterprise space known as ‘cloud lock-in’.

Although it’s impossible to predict what your needs will be years down the track, avoid going ‘all-in’ with a single cloud provider and look for solutions that give you the flexibility to make your own decisions as your needs change.

Seek simple scalability

Data is growing at an exponential rate. According to IDC, the rate of data-driven interactions will increase 20-fold in the next decade.

Whatever your needs are today, they will be much higher by the time the budget sweetener runs out.

One of the biggest challenges businesses face today is wrangling these ever-growing data volumes. As more and more customer interactions happen online, unstructured data will only become more difficult to manage.

With that in mind, SMBs should seek solutions that easily scale as their business grows.   

Value visibility

There are so many insights waiting to be uncovered within unstructured data. Still, many SMBs lack the visibility to understand what data they have – let alone begin to analyse it.

The legacy data infrastructure many SMBs use today is effectively black holes. Once data goes in, there’s zero visibility into where it’s come from, who’s using it, or even what it is.

To kickstart any digital transformation journey, it’s critical to think about how you can best put your data to use. Whether uncovering customer insights, automating business processes, or improving internal efficiencies, it all starts with understanding your data.   

Prioritise security

Ransomware and malicious cyberattacks are some of the biggest risks businesses face today. According to the Australian Institute of Criminology, cybercrime costs the Australian economy $3.5 billion each year.

Any digital infrastructure decisions need to be made with cyber security front and centre.

The ‘crown jewels’ of any business today is its data. Without access to data, it is impossible to operate.

Unfortunately, many Australian businesses have learned this the hard way over the past few years as the legacy infrastructure they relied on didn’t stand a chance against sophisticated attackers.

One of the most fundamental cyber hygiene practices SMBs should practice is encrypting their data ‘at rest’. Given the small IT teams and limited technology budgets many small businesses operate with, a data storage platform that automatically encrypts data can help protect the business from external and internal threats.      

Consolidate skills

Any digital investment is only as good as the people using it. If staff need to learn a whole new set of skills to manage a new platform – or if it is overly complex – all the promised benefits may never be realised. 

This is particularly true of cloud platforms. Whether AWS, Azure, or Google, each cloud has its own idiosyncrasies and nuances that require significant training to manage effectively.

Nutanix’ recent Enterprise Cloud Index found that 51% of organisations will use two or more public clouds in the next 12 months. 

For SMBs who see the cloud as their future operating model, an initial step during this period of Government generosity should first be to implement a smaller-scale private cloud that remains under their control.

Not only will this give them the flexibility to choose how and where they operate in the future, but these platforms can also act as a Rosetta Stone between public clouds. Once skilled in managing this platform, the same interface can be used to manage any number of other cloud environments.  

This year’s Federal Budget has given SMBs a real opportunity to set themselves up for a digital future. While it might be tempting to rush headlong into investments that answer the business's immediate needs, the last thing you want to do is make long-term architectural decisions based on short-term budget measures. 

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