Britain’s SMEs are shifting the billions spent each year on hiring traditional experts, such as legal and procurement consultants, to leverage the skills required to survive in an increasingly digital world, including those for cyber security and new payments technology.

According to research from Barclaycard, which has helped make businesses successful for over 50 years, UK SMEs now invest £2.9 billion annually on cyber security experts to help them stay ahead of the latest threats.

This equates to an average figure of £1,600 per business, with many larger SMEs spending ten times more. The same amount (£2.9 billion, or an average of nearly £5,000) is channelled into support for implementing new payment innovations such as contactless technology, which Barclaycard introduced to the UK in 2007.

>See also: How can SMEs protect themselves in a world of cyber crime?

Sharon Manikon, managing director of Customer Solutions at Barclaycard, said: “UK SMEs face immense pressure to keep up with competitors of all sizes. This is
all the more challenging in an uncertain political and economic landscape with shifting consumer preferences and new technology that continues to develop at pace.”

“As a result, there are more demands on their budget than ever, and these are forcing SMEs to spend smarter. One way to make budgets work harder is to engage suppliers who don’t just provide competitively priced products and services – but also offer access to the specialists who provide consultancy to help businesses continue to thrive. This will help SMEs derive the most value from their experts, helping to drive their business forward.”

Small businesses have increased their spending over the last five years on cyber security professionals by 43%, and by nearly 31% on payment innovation. SMEs plan to continue investing next year, with spend on cyber security expertise set to increase by 32% and payment innovation by 23%.

In contrast, demand for more ‘traditional’ experts is falling. Three in 10 (33%) SMEs have decreased investment in procurement, for example, as they believe it is becoming less relevant for their business. And the 15% of SMEs who cut spending on legal and compliance experts did so to make way for spending on new skills to future proof their business.

Managing competing demands

With small businesses facing challenges from all directions – including an uncertain economic landscape and changing consumer preferences – more than a third (34%) are worried about their ability to manage these multiple demands and priorities as their business grows.

>See also: 7 cyber security threats to SMEs and how to secure against them

Such is the concern among SMEs about cybersecurity, for instance, that it is a greater worry for many than the uncertainty surrounding Brexit. Four in ten (44%) small businesses fear being victim of a cybercrime or data breach, compared to three in ten (34%) who are anxious about the impact of Brexit on their business.

The research suggests SMEs can make their budget work harder by hiring experts who provide support across multiple areas, especially when it comes to technology. Of the small businesses that increased spending on fraud prevention, for example, a fifth (23 per cent) subsequently noticed a rise in sales and customer satisfaction, likely due to improved customer confidence.

The experts of the future

Looking ahead, SMEs will need to engage experts of the future to keep up with nascent trends. This includes ‘next generation’ payment specialists who would advise on emerging technology such as ‘conversational commerce’ – which uses digital assistants to make a purchase – and ‘invisible payments’, where card details are saved in advance of a transaction, such as for one-click ordering. A third (33%) of businesses have never heard of these technologies, despite 44% of consumers being keen to pay in these ways.**

Beyond the evolution of payments, futurologist David Price predicts that British businesses will face even more challenges and will subsequently need a wide range of experts over the next decade. These include:

• Social purpose consultants who will work alongside SMEs to ensure they respond to growing demands from millennial customers for a service driven by ethical practices.               • ‘Tech overload’ therapists to support employees who have become overwhelmed by being part of an ‘always on’ society.
•  Online experience designers, responsible for improving user experience by incorporating virtual and augmented reality technology into online interactions.

>See also: SMEs do not train staff on cyber security risk

Futurologist David Price said: “As consumers become more tech-savvy, SMEs are increasingly dependent on their digital presence for survival, and face new pressures from all angles. A deep understanding of emerging technologies – like artificial intelligence, and augmented and virtual reality – will all become ‘must haves’, not luxuries, over the next five to ten years.”

“The challenges of this changing landscape also extend well beyond the realms of what you might expect. Businesses will need to think outside the box to cater for the demands of more discerning consumers, for whom social purpose, for example, is now a key priority.”

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