Date: 12th July 2019
Something struck economist and researcher Muz Mumtaz three years ago when he was working across the Leeds City Region on surveys of large employers. He realised that many businesses, irrespective of size or sector, faced a common hurdle in their plans for growth.
He explains: “The thing that constantly used to come up was that businesses struggle with digital and IT. There was a lack of understanding or investment in the right types of solutions for their specific business that would help them grow. There was a huge gap there that they really needed to consider.’’
Muz and his team did some more research and found that SMEs desperately needed help both in terms of encouraging them to invest in digital, but also in supporting them and providing advice on choosing the technologies appropriate to their needs.
He says: “There’s a massive gap in the SME sector in digital marketing and social media and how to deploy digital solutions to effectively build their businesses. At the time there was no kind of business support programme delivering this kind of comprehensive support.’’
Muz put together a case which he took to the relevant local authorities and the LEP to try to access EU funding that was dedicated to helping businesses cope with digital change and transformation. A successful bid was submitted and the result was Digital Enterprise, an £8.5m programme, which Muz heads.
Since October 2016, Digital Enterprise has been helping SMEs across the Leeds City Region to improve their performance by investing in appropriate digital technologies and expertise. The aim of the programme has been to support small firms in achieving digital maturity as they grow. It has done this by providing funding – in the form of vouchers – for businesses to invest in developing their digital capabilities and also by providing access to a wide range of educational opportunities so that businesses could improve their digital knowledge and skills. It immediately became clear that Muz’s belief had been well founded – there was a real need for such a service.
“In the early days I was amazed at the level of demand that the programme achieved,’’ he says. “Within the first few months we were so successful that we had to close part of the programme down for a while because we just could not deal with the demand from businesses. We only anticipated funding to support around 100 businesses in the early stages, but we received about 560 applications and we had to close it down to new applications just to deal with that backlog. As a consequence, we introduced phases – windows of opportunity to apply for funding – and we managed the numbers much more effectively that way.
“One of the reasons for our success has been the ease of access to the programme. One of the innovations that we brought in, which was new, was an online application form. It doesn’t sound ground breaking now, but it was then, it had never been tried before. The traditional business community were sceptical saying that it might not work, but it worked fantastically well.
“We very much look at the whole thing from a business’s point of view and one of the grumbles they often make is about the bureaucracy of obtaining funding and how difficult and convoluted it is. Business people are generally very time poor and keen to get some help but have been scarred by previous programmes which had been very bureaucratic. We were keen to make it as accessible and relevant to their needs as possible. Businesses came to us tearing their hair out and Digital Enterprise was a breath of fresh air for them.’’
Similarly, the Digital Enterprise programme has sought to make contact with its target businesses in new ways. Muz explains: “We tried to be innovative and to do things differently – to break the mould and not go through the traditional intermediaries. We discovered that we were much more successful in targeting businesses directly through social media and digital marketing. Our website is designed to talk to businesses directly. As a consequence, we did not need to rely directly on traditionalnetworks. For me that’s one key factor behind our success: that we always tried to be innovative.’’
And that success has been tangible. Currently the programme is supporting about 1,500 businesses and evaluation suggests that between 1,500 and 2,000 jobs have been created. The kinds of projects which have been supported by funding through the vouchers are typically businesses investing in new – or updating their existing – hardware or software, developing their local networks and upgrading their broadband connectivity. Greater use of cloud computing is also becoming an increasingly important tool for businesses.
“There has been a big focus on getting businesses to become more flexible and agile,’’ says Muz. “We have made a really conscious effort to try to encourage industry, manufacturing and advanced manufacturing to upgrade their systems and technology. There has also been quite a lot of investment in software such as customer relationship management (CRM) systems and website development – in particular introducing e-commerce functionality. We have encouraged businesses to move away from the traditional brochure type website and to be much more interactive with their customers. This is what customers demand when they are working with corporate clients such as the Amazons of this world. SMEs need to make sure that their initial presence is just as sharp, effective and engaging, as a much larger business.’’
He argues that making digital technology more accessible to smaller businesses levels the playing field for them when it comes to competing with bigger players. “That was one of our common objectives in the early days, to make sure that smaller businesses were not left behind because they had not got the budgets to invest in IT and digital projects. The aim was to allow them to move forward and capture new customers and markets.’’
Digital technology develops at such a pace that in little more than two years since the programme was launched the priorities for businesses have changed, with greater use of mobile and tablet technology and a growing emphasis on cloud computing. “Using cloud-based solutions has been a big development and will continue to increase rapidly over the next few years. This has undoubtedly been aided by businesses accessing faster connectivity, such as by upgrading their broadband. Now things like artificial intelligence are beginning to come onto the scene and 3-D printing, especially for the manufacturing sector,’’ says Muz.
“Analytics and smart technology is becoming much more common, particularly around manufacturing types of businesses. More and more businesses are introducing CRM systems that are designed for their particular needs, allowing them to effectively track and manage interactions with their clients and their requirements. Businesses are becoming much more intelligent as a result of adopting smarter digital technology, which gives them the information that they need to be more effective and more efficient.’’
This pace of change means it’s not only important to support businesses in acquiring new hardware, software and IT systems, but also in adopting a culture of learning so that they are comfortable in a new digital environment.
Digital Enterprise’s Digital Knowledge Exchange, which provides access to a wide range of workshops on all things digital, mentoring opportunities with digital experts and digital audits, has provided an environment in which businesses can improve their knowledge and skills so that they can take advantage of the digital opportunities which are available to them.
“It’s about managing change effectively, in terms of infrastructure, technology and skills,’’ says Muz. “The Digital Knowledge Exchange focused on helping businesses to get their staff and their managers to be much more skilled and enable the use of things like social media and digital marketing.’’
From the start, Digital Enterprise recognised the importance of suppliers. Muz recalls: “When I first launched the programme, one of the key things I did was to meet as many different suppliers as possible to find how they could help small businesses and to understand how important their contribution was. Since then, a lot of suppliers are now holding their own events and are encouraging their customer-based partners to seek assistance from Digital Enterprise.’’
One early innovation was the creation of a supplier page on the Digital Enterprise website, which serves as a directory of suppliers in the area. “The reason behind that was not only to help and accommodate suppliers – and we don’t charge anything for that listing – but also to help small businesses. If you’re an SME looking for a website designer, a CRM supplier or a hardware supplier, you can go to our website and filter out which ones you are looking for based on geography and other elements. It’s there for small businesses looking for suppliers to support their projects, but equally it benefits suppliers, many of whom have gained hugely from this programme. In the future, we will probably be doing more work with them as they are integral in helping us to assist businesses with their digital requirements. We try to keep it local as much as we can as we want to support and encourage local suppliers to work with local businesses.
“One of our reasons for doing the programme was to try to improve the conversation between suppliers and their clients. A lot of SMEs were paranoid and suspicious of the technology that suppliers were recommending. There’s a bit of distrust and disconnect between the two. As such, we have encouraged a better quality of conversation between both groups.’’
Due to the size of Leeds, much of the programme’s work has been with businesses in the city, particularly in the digital, financial and professional services sectors, but also manufacturing. In more rural areas, such as Craven and Selby, interest in the programme has predominantly come from smaller scale businesses that have issues around connectivity. These have been typically more traditional types of businesses and in the hospitality sector. There are certain sectors that the programme cannot help due to the way it is funded, such as those engaged in agriculture, but help is possible for businesses seeking to diversify away from agriculture into other areas.
“We tend to get more manufacturing businesses in the South West of the Leeds City Region in places like Kirklees,’’ says Muz. “York is more service based and so is Harrogate. Leeds itself is a good representation of the whole city region.
“An interesting thing for us to observe has been the different types and range of businesses who we have been able to assist. It could be a one-man band with no other employees, all the way up to businesses that employ over 200 people and have a multi-million pound turnover. Being able to help that diversity of business can be interesting and challenging because they are looking for different solutions and are also at different stages of their digital journey. You have young businesses developing their websites and at the other end of the scale you have mature businesses that are agile and almost fully cloud operational and at the cutting edge of technology. So it’s a real challenge, but also really interesting to see how businesses develop and use technology to grow.’’
The current phase of Digital Enterprise ends in August 2019 and the team are currently supporting a wide range of businesses who have been approved for voucher funding with their digital projects. The success of Digital Enterprise has not gone unnoticed, and as a consequence the programme has successfully secured funding from the European Regional Development Fund to deliver a new £10m programme called Digital Enterprise 2.0, which will begin in September 2019 and will run until August 2022.
Muz says: “Securing further funding is a real vote of confidence in what we’ve been doing and encourages us to continue with this type of vital business support across the city region in the future. We are delighted that our programme will continue for at least the next three years and will provide even more businesses with the opportunity to embrace digital. Whilst the programme won’t re-open until September, businesses can register their interest now, so why delay.’’
Businesses interested in taking advantage of the Digital Enterprise programme when it re-opens can register their interest NOW by visiting www.digitalenterprise.co.uk/de2