The pandemic has reshuffled the priorities of businesses big and small, with digital transformation becoming top of the agenda. Now, a new report claims that a national investment in digital skills could add €9.5bn to Ireland’s economy in the next three years.

Commissioned by Google and conducted by Irish market research company Amárach, the Bridging the Gap report is based on a survey of 1,000 Irish SME leaders in December.

The survey asked leaders of Irish SMEs about their experiences and ambitions in digitally transforming their businesses and found that a majority (62pc) of them are “less than halfway” on their digital journey.

For instance, just over half (55pc) of Irish SMEs surveyed were found to have their own website – significantly lower than the European average of 77pc – while only 53pc have accounts on social media and video platforms and 18pc use customer insight tools.

Challenges

The report found that there is a strong interest among Irish SMEs in investing in digital skills, but challenges such as “a lack of strategic clarity” and not having the right people in place to oversee the transformation continue to hinder progress.

Around 41pc of respondents agreed that they don’t have a single person within the organisation to help other employees develop their digital skills.

This is a matter of concern because only around one in four SMEs said their employees have all the skills needed for basic digital capabilities, while only 11pc felt their employees have the skills needed to successfully adopt and use new technology.

There is also a strong regional inequity in terms of the current state of digital capabilities in Irish SMEs, with those based in Dublin reporting a disproportionately better state of affairs than most other counties.

Ireland’s SME sector

Alice Mansergh, director for small business at Google, said that any decisions around digital capabilities by business leaders and policymakers now will have “profound implications for the long-term productivity and profitability of the SME sector” in Ireland.

“For its part, Google will use these findings to help shape the courses we provide via the Grow with Google initiative helping to train people in key digital skills that will empower them to embrace new business and commercial opportunities,” she added.

Irish SMEs expect significant benefits of improving digital capabilities. Around 28pc of respondents believe that it would allow them to increase wages and salaries while more than half (57pc) said that it would help their businesses grow faster and become more profitable.

“Small and medium enterprises remain the backbone of the Irish economy; accounting for 99pc of active enterprises and 70pc of employment,” said Leo Clancy, CEO of Enterprise Ireland, of the report. “For successful businesses, digitalisation isn’t an option, it is a crucial advantage that allows them to compete and win.”

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