Australia’s mid-market is often referred to as the engine room of the nation’s economy, employing nearly a quarter of all Australians and responsible for almost 40 per cent of Australia’s business revenue.
But what do they really think?
KPMG Enterprise and Fairfax Media collaborated to research and capture the issues of prime importance and concern to the mid-market.
The research highlights five priority issues:
Sentiments about growth are broadly optimistic
The majority of respondents are confident in their companies’ future. However, they expressed concerns over growth prospects for the global economy. Respondents feared there would be one or two serious economic downturns over the next few years which will impact consumer confidence. China’s bullish growth was also perceived as an ongoing risk.
Overall they feel they are having to work harder to see results with growth viewed as more than financial. Increasing market share, diversifying their business and onboarding new digital technologies are key priorities. The competition for talent is keenly felt and a lack of the right employees continues to be a significant barrier to success.
Technology is a cause for concern, but also optimism
Although the report names emerging / disruptive technologies as barriers to growth, change is also viewed as an opportunity, and on the whole, respondents view technology positively. Harnessing tech is a way of offering cost-reduction and increased efficiency, improved products, providing greater service and customer-centricity. This certainly echoes the Enterprise experience, with many of our clients taking advantage of technology that is more affordable than ever before.
Adaptability, agility and innovation are key to growth and success for mid-market businesses
Respondents view regulatory risk as the number one challenge but the mid-market is also perceived as nimbler and more ready to adapt to change than larger, corporate “dinosaurs”. Industries are becoming disruptors and this carries a degree of risk, which the mid-market is willing to embrace. This sector is also taking advantage of public perceptions of trust. Many customers and communities prefer to deal with smaller, local, organisations. They have more confidence in them to deliver services, keep their promises and protect their reputation. The value held in the mid-market is reason for optimism and growth.
Customer-centricity is top-of-mind for mid-sized businesses
The mid-market understands the value of putting customers first and ‘customer-centricity’ is not so much a buzzword as a business priority. This means delivering high quality products and services, providing a consistent experience across communication channels and employing sophisticated data analytics to understand customer trends. Increasingly, customer service is tailored to individual needs. As demographics shift, this bespoke experience will become especially important to maintain engagement with Millennials, who select organisations as much for lifestyle reasons as commercial ones.
Mid-sized businesses are divided in their perceived readiness for cyber attacks
Cyber crime is on the rise. One third of report respondents were uncertain as to their cyber readiness; a concerning figure. Small to medium-sized businesses may not feel they are big enough to be targets, however they are at risk for precisely this reason and must be prepared to invest in preventative measures to protect their businesses.
Over the next decade, the mid-market has the opportunity to transform itself into a new world order that’s profitable and customer-centric. But investment in technology over the next three-five years will be crucial to achieve their vision.
Read the full report, Growth 2.0: A snapshot of the mid-market
The mid-market was defined as either private companies, family businesses, publically-listed outside the ASX 200, or start-ups and not-for-profits, with annual revenue of $5-500 million or more. More than 300 decision-makers responded, almost half from strong, well-established businesses.