By Daniel Hunter
Almost two thirds of small and medium sized enterprises (SMEs) in the UK lack the essential visibility and understanding to run an effective business, according to research by tech firm ClicData.
When asked UK SMEs whether they had an accurate insight into the health of their business, 62% admitted they didn’t. Meanwhile, 6% admitted they never even look at their accounts, suggesting that up to 300,000 UK companies may be dangerously unaware of the real state of their business.
The survey also highlighted that many UK companies live under an illusion, with two thirds (67%) believing their decisions are based on up to date information, even though 60% admit they update the information no more than once a month.
ClicData believes that lack of clear and timely insight and understanding of a business may be stifling or even killing what may otherwise be great business ideas.
The company is convinced that the fundamental issue in how businesses monitor their KPIs lies in how information is presented and shared throughout management teams, since more than half (51%) of SMEs admit running their business from an Excel spreadsheet; and a third (34%) made it known they have no clear understanding of their management accounts. As businesses grow larger and the responsibility shifts towards outsourced financial support, the lack of understanding worsens, with 83% of decision makers in larger SMEs stating they do not understand their company accounts.
“In a country where SMEs employ 60% of the workforce and generate close to 50% of the turnover of all private enterprises, it’s unimaginable to think that most do not have access to live information to make decisions which may determine their own future,” said Telmo Silva, ClicData CEO.
“Even where information is ‘live’, it is clear from these findings that SMEs have an opportunity to improve how this information is packaged and presented to educate key stakeholders and give them clear guidance on the appropriate actions to take.”