A01 chaf6542 06 se fm indd

 Limited SME adoption of digital 

business 

 ‘Adoption of digital business by 

established SMEs is generally less 

than that in larger businesses. This 

is principally a consequence of the 

negative attitude of managing directors 

and CEOs to the business benefits 

of information and communication 

technology (ICT).’ 

 Debate  1.2 

  Risks and barriers to digital business adoption 

  The Internet is a typhoon force, a ten times force, or is it a bit of wind? Or is it a force that 

fundamentally alters our business? (Grove, 1996)  

 This statement still seems to encapsulate how managers must respond to different digital 

technologies; the impact will vary through time from minor for some companies to signifi-

cant for others, and an appropriate response is required. 

 There are also many practical risks to manage which, if ignored, can lead to bad customer 

experiences and bad news stories which damage the reputation of the company. In the sec-

tion on digital business opportunities, we reviewed the concept of soft lock-in; however, if 

the customer experience of a service is very bad, they will stop using it, and switch to other 

online options. Examples of poor online customer experience include: 

   

● 

  Websites that fail because of a spike in visitor traffi  c aft er a  peak-  hour TV advertising 

campaign.  

  

● 

  Hackers penetrating the security of the system and stealing credit card details.  

  

● 

  A company emails customers without receiving their permission, so annoying customers 

and potentially breaking privacy and data protection laws.  

  

●  

  Problems with fulfi lment of goods ordered online, meaning customer 

orders go missing or are delayed.  

  

● 

   Email customer service enquiries from the website don’t reach the 

right  person  and  are  ignored.      

 The perception of these risks may result in limited adoption of  digital 

business in many organisations, which is suggested by the data in 

 Figure   1.11   . This is particularly the case for SMEs. (We study adoption 

levels and drivers in this type of business further in  Chapter   4   .) 

 Another approach to reviewing the strategy issues involved with 

implementing digital business is the classic McKinsey 7S strategy instru-

ment (Waterman  et al  .,  1980)  which  is  summarised  in   Table   10.1   .