Charities and SMEs across Yorkshire could be jeopardising their future growth and funding prospects as they fail to see the benefits of digital technology, according to the latest UK Business Digital Index published by Lloyds Bank.
The Index, in association with Accenture and digital skills charity Go ON UK, is the only report of its kind in the UK and tracks the level of digital adoption of SMEs and charities, for example running a website, using e-commerce, maintaining a social media presence or using online banking tools.
Digital adoption among charities has declined slightly in the past year, with 39 per cent having basic digital skills, compared to 41 percent in 2014. The report also shows that many charities do not see the benefit of going online, with 26 per cent of respondents surveyed believing that being digital isn’t relevant for their charity.
Although three quarters (74 per cent) of SMEs in Yorkshire and Humber have basic digital skills, there has been no improvement on last year’s results. Just over half (53 per cent) of businesses in the region have a website and only 26 per cent can take orders online.
Not all charities in the region understand the benefits of digital technology with 66 per cent doubting how websites can help donations, and three quarters (74 per cent) saying they do not invest any money in enabling digitisation.
Just over half (56 per cent) of the charities surveyed said they had a website, and more than one in ten (11 per cent) have no access to the internet.
Even among the charities that operate a website, just 17 per cent are able to take payments in different currencies online, limiting the ability to grow their donations.
The same issues were replicated across businesses in the region. Although over half (58 per cent) of digitally enabled SME’s say being online helps them to reach more customers, many still struggle to see how technology can help their business, with 41 per cent doubting how an online presence can improve revenue.
A new indicator for 2015 is the correlation between digital maturity and organisational success. The 2015 Index shows that overall the most digitally mature SMEs are more than a third more likely to report an increase in turnover in the past two years compared with those businesses that are the least digitally mature.
Charities in the region that have adopted digital technology citied effective marketing as a key benefit, with 62 per cent saying technology has helped them reach more people. Efficient payment was another key benefit, with half (50 per cent) saying they received payment more quickly.
Digital maturity also correlates with positive business sentiment. 69 per cent of the organisations that utilise online measures report that they feel confident about the future.
Leigh Taylor, area director for SME Banking the North East, Lloyds Bank Commercial Banking, said: “This year’s report makes it clear that real challenges remain around the perceived benefits of being digital.
“The figures show that there is a need to encourage more organisations in Yorkshire and Humber to adopt digital strategies and skills in order to bolster their growth opportunities. Charities, in particular, need additional support to ensure that valuable funding opportunities are not missed.
“Here at Lloyds Bank, we want help businesses to make the digital technology a priority, by encouraging them to recognise that an online presence can unlock growth potential, improve efficiency and build confidence in a way that traditional communication does not allow.”
Commenting on the report, Baroness Lane-Fox, Chair of GO ON UK said: “Perceptions and motivations remain key issues, with a quarter of organisations still believing that doing more online isn’t relevant to their business. And in an increasingly globalised marketplace, still only 13 per cent of organisations in the UK are using their website for e-commerce. This is an ever increasing concern that needs our imminent attention.
“Another large issue uncovered by this year’s report is the intelligence that charities are being left behind in this shift, and we must do more to ensure that this doesn’t continue.
“The UK has a proud tradition of giving and charitable work, and surely supporting charitable organisations to achieve their digital potential must be part of this.”