Five technology-driven trends that will redefine successful small businesses
By William Atkinson
No matter their age, experience or background, more people than ever are interested in starting their own business, entrepreneurial developers and researchers say. “There has been a real shift in the attention given to entrepreneurship since the recession,” observes Charisse Bowen, director of the Institute for Entrepreneurship at Colorado State University in Ft. Collins, Colo.
Since the recession, more new college graduates have been looking to create their own companies rather than wait for some company to decide to give them a job. Perhaps more surprisingly, older Americans, those between the ages of 55 and 64, are more likely to start a new business—in fact, one-third more likely on average—than any other age group, says Diana Kander of the Kauffman Foundation, an entrepreneurial development nonprofit group in Kansas City, Mo.
“Pretty consistently, in good economies and bad, there are about 500,000 people a year starting new companies,” Kander says. “The main reason is that people are excited about the idea of achieving economic independence and determining their own future.”
But increasingly affordable, scalable and ubiquitous technology—which are just as important as the success traits of entrepreneurial drive and ideas—will shape how and whether today’s small-business startups become tomorrow’s Main Street job creators and economic engines.
Here are five trends—all driven by technology—that will shape and determine the success of small businesses in the future, regardless of the age of the entrepreneurs who will lead them.
1 Business of one. According to the U.S. Census Bureau, small businesses operated by a single person make up more than 70 percent of America’s 27 million companies, generating total annual sales of $887 billion. Technology will only accelerate the trend of single or dual workforce companies, composed of principal owners and perhaps a few key specialized employees/shareholders. This will create workforces of vast talent pools of nimble freelancers who are available to tackle projects and responsibilities as needed, from any time zone.
2 Global outreach. Tethered together through the Internet, mobile and social media networks, tomorrow’s successful small businesses will tap into markets that cross national borders and language barriers. Products, services and expertise will be built, sold and made available anytime to anyone through the Web. In other words, down the street could quickly become across the ocean. Increasingly, even Main Street small businesses equipped with the right technology will be able to sell multimillions in wares and expertise by tapping into the global marketplace. Marketing to and reaching new customers from vastly different cultures—living worlds away—will become commonplace.
While most of today’s street-corner entrepreneurs don’t look at the world “as their oyster,” that will change through technology. Entrepreneurs who can think and thrive without borders within a multicultural world will have a tremendous edge.
3 Ubiquitous, distributive computing. Cloud computing and the mobile revolution will combine to free entrepreneurs to focus on their core ideas and skills. Operational business processes will be easily available and affordable, outsourced and rented by the minute from the Web. Successful small businesses will scale themselves—and their cost infrastructures—to be remarkably unencumbered by full-time accounting, IT, human resources or marketing departments.
4 Collaborative crowdsourcing. In the past, businesses have operated mostly with one-way communication to the customer, with anonymous zero-sum purchases serving as the primary measure of a business’s success. Now with blogs, Twitter and other open communication channels, customers respond directly and in real time, often unfiltered. Moreover, through crowdsourcing, customers will collaborate with businesses to determine how products and services are created, delivered and consumed.
In this way, products and services will also be increasingly tailored to the needs of each individual customer—on demand, instantly. Small businesses that can structure themselves through technology to respond to and even run on direct feedback from customers will corner their marketplaces, from Minneapolis to Mumbai.
5 Sustainability. Sustainability is the ability of businesses to endure, the result of extending the efficiency and value of one’s products and services. Sustainability initiatives usually spur environmentally conscious green initiatives. However, it is more than just being “green.” Sustainability is about efficiency of time, labor, operations and knowledge-sharing. Technology will drive this efficiency, resiliency and universal access to information.
Small businesses that adapt to these technology-driven trends and scale themselves to embrace the new digital environment will create the new jobs on Main Street.
William Atkinson is a writer in Carterville, Ill. Tim Cook, ICBA’s vice president of publications, contributed to this article.