Technology failures are a major headache for small businesses

A new poll  from TalkTalk Business claims to identify the significant impact technology failures have on small and medium-sized enterprises (SMEs) in the UK. According to the survey, nearly one-quarter (23 percent) of these businesses have experienced system glitches within the past year. These technical issues are proving costly for many SMEs, with 17 percent reporting that such problems have cost their business between £500 and £999 over the last 12 months. More alarmingly, 12 percent of SMEs have faced losses ranging from £2,000 to £3,999, while 7 percent have incurred staggering costs between £8,000 and £9,999 due to technology-related failures.

The research highlights the broader financial strain on UK SMEs as they grapple with the expense of upgrading or replacing outdated technology. A quarter (25 percent) of SMEs are struggling with the high costs associated with technological upgrades, a challenge that is particularly pronounced in the healthcare sector. In this industry, 50 percent of businesses are facing budgetary constraints when it comes to updating their technology infrastructure. This financial pressure is compounded by the struggle to stay competitive, as 22 percent of SMEs feel they are falling behind their competitors due to outdated technology.

On average, these technical difficulties are costing the UK’s 5.5 million SMEs approximately £3,100 annually. TalkTalk Business conducted a survey of 250 SMEs across various sectors to identify the most pressing technology-related challenges they face. The findings revealed that slow internet or connectivity issues are the most common problem, affecting 33 percent of SMEs. This is followed by the high costs associated with upgrading or replacing technology (25 percent), and technical glitches or system failures that disrupt business operations.

Other significant challenges identified by SMEs include the need for employee training and education on effective technology use (19 percent), cybersecurity threats (17 percent), and the difficulty of keeping up with new technologies and industry trends (17 percent). Compatibility issues between different software or hardware systems are a concern for 15 percent of businesses, while 14 percent struggle with a lack of support or resources to manage technology effectively. Issues with cloud-based services, such as downtime or security concerns, affect 11 percent of SMEs, and inadequate backup and recovery plans for data loss or system failures are a problem for 7 percent.

The study also revealed the extent to which UK SMEs rely on technology for their daily operations. A significant 74 percent of SMEs depend on Wi-Fi to run their businesses, while other essential technologies include accounting software (63 percent), cloud-based storage (48 percent), video conferencing tools (48 percent), and card readers or payment tools (44 percent).

Despite the persistent threat of cybersecurity issues, with 17 percent of SMEs experiencing a cyber-related problem in the last year, more than half (58 percent) of these businesses are not using any form of cybersecurity software. The research underscores the financial toll that technology failures and cybersecurity threats can have on SMEs, with the average cost of these issues exceeding £3,100 per year. For a small but significant percentage of SMEs, these costs can escalate to as much as £9,999 annually.