The Key to Digital Transformation for SMEs: Building Strong Relationships
Digital transformation is crucial for SMEs to remain competitive and thrive in a fast-evolving digital economy. However, new research reveals that success lies not only in adopting technology but also in fostering strong relationships within the organisation.
The findings, from an 18-month research collaboration between the University of Leeds and the University of the West of England, funded by the British Academy, shed light on why SMEs often lag behind larger firms in digital adoption. The research highlights that while technical skills and digital tools are essential, the relational aspects of transformation—building trust, gaining buy-in, and aligning efforts across teams—are just as critical.
The Relational Side of Digital Transformation
The study, involving 77 SME practitioners from the Northwest and Southwest of England who had participated in digital upskilling programmes, found that participants who successfully implemented digital change within their organisations excelled at managing relationships. Beyond acquiring technical skills, these individuals built trust and gained buy-in from colleagues and stakeholders, addressed resistance to change, and integrated new tools into existing organisational processes.
“Digital transformation is not just a technical challenge—it’s a relational one,” said Dr Selen Kars-Unluoglu, lead researcher on the project. “Our research demonstrates that focusing on the human and relational aspects of transformation is key to driving meaningful and sustainable change.”
Read More: Is Business Automation and Digital Transformation the Same?
Introducing the ADAPT Model
To help SMEs navigate their digital transformation journeys, the researchers (Dr Selen Kars-Unluoglu, Dr Alex Kevill and Dr Mariana Estrada-Robles) developed the ADAPT model – a practical framework that highlights five critical dimensions:
- Agency: Building confidence and taking ownership of digital initiatives.
- Destination: Establishing a clear vision and actionable goals.
- Association: Creating a network of support and collaboration within the organisation.
- Progress: Achieving and celebrating incremental wins to build momentum.
- Tapestry: Integrating new technologies with existing systems and processes.
The ADAPT model empowers SME leaders to combine technical skills with relational strategies, ensuring that digital transformation is seamlessly woven into the fabric of their organisations.
Why This Matters
Digitalised SMEs grow twice as fast, export twice as much, and create twice as many jobs as non-digitalised counterparts. However, government initiatives like Skills Bootcamps and AI Upskilling funds often focus solely on technical training. This research underscores the need for a broader approach that includes fostering collaboration and embedding digital skills into organisational culture.
For more information about how SMEs can implement the ADAPT model (including a video explainer, podcast episode and blog post), visit the project webpage.
