A staggering 93% of South West SME business owners have no plan to help them cope with disruption, according to a new study by top 15 UK chartered accountants Haines Watts.
Yet while worries around disruption are almost universal (98% express fears), just 7% of leaders have a plan. Over half are not acting proactively – admitting they haven’t thought about disruption or have thought about it but not done anything (54%), instead waiting to see what disruption brings, and then hoping to respond after the event.
SME’s most common concern was government-related disruption, including legislation and regulatory changes that will impact the way they do business. More traditional forms of disruption also place highly on South West business owners’ list of concerns, including competition from larger businesses entering the market (45%) and changing customer expectations (31%).
Haines Watts has offices across Devon in Exeter, Crediton, Okehampton, Bideford & Barnstaple as well as offices in Launceston, Cornwall.
Ben De Cruz, Managing Partner – Haines Watts Exeter office, comments:
“Brexit has distracted UK business owners from the very real threat of industry disruption. While fears around regulatory disruption are exceptionally high, business owners may not be concerned enough about the kind of disruption that will threaten their very business model.”
The type of disruption that makes headlines the most – that of radical new business models – featured comparatively low down in South West business owners’ fears, with just a quarter (27%) citing this as a concern. Fear over new technologies disrupting markets is even lower at 25%.
Ben De Cruz continues:
“It’s hard to envisage how threats like new technology could unfold when the challenges they pose are only partly visible, but that doesn’t mean that preparation can’t get under way. There are steps every business can and should take to prepare the ground for the changes that will come.
“Although the pace of disruption has picked up, the temptation to bury our heads in the sand and stick to what we’re comfortable with is not new. In 1996 Bill Gates wrote that ‘we always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten’. Those timelines are even shorter now and the danger of underestimating disruption is greater than ever.”
Motivation and ambition
While disruption can be intimidating, and the difficulty of preparing concerning, it can also be positive. One in five (22%) business owners say that disruption makes them more determined. Disruption could be good for business owners, by keeping them on their toes and ensuring they stay ahead of the game. Similarly, 22% say that it makes them more ambitious.