What can we learn from how the Mittelstand is approaching hyperautomation? As we go through a period of acute economic and societal change, the responses of small-and-medium-sized businesses in Germany, Austria, and Switzerland could provide insights for all.
These changes include effects from the fallout of the pandemic, followed by the war in Ukraine and rising interest rates — to name three. On a global scale, businesses have responded to these varied challenges by moving transactions and processes online. This is in addition to increased remote and distributed working.
This sharp pivot to digital has enabled companies around the world to cope with the unforeseen challenges. But it doing so has unlocked more challenges too — namely growing pressures on every organisation to improve digital capabilities.
In the face of this second challenge, most have responded admirably by levelling up their digital transformation efforts. This started with rapid digitization. The average European business accelerated its adoption of digital products and services by seven years in 2020 alone. This, in turn raised the bar for how efficient businesses can be through digitization and prompted a second trend — the automation of business processes at lightning speed.
“Hyperautomation”, as this is often known, is a trend coined by market analyst company Gartner. It describes hyperautomation as the “business-driven, disciplined approach that organizations use to rapidly identify, vet and automate as many business and IT processes as possible.”
Put differently, it’s ‘Business Transformation 2.0’. And it has taken hold around the world. According to Gartner, the market for hyperautomation technology will hit $596.6 billion in 2022.
Hyperautomation: a priority across EMEA
It does not require much imagination to understand the business appeal of hyperautomation. From eliminating errors and wasted time caused by human interventions to enabling better collaboration through faster data sharing, hyperautomation means businesses can do more without needing additional resources. This then clears a pathway for future growth.
With these benefits in mind, hyperautomation has become a priority for businesses in EMEA. In a 2022 Jitterbit survey of EMEA systems integrators:
- 64% agreed or strongly agreed that hyperautomation is a priority for their customers
- 79% say they are doing everything they can to automate how they deliver solutions to customers.
Hyperautomation adoption has not been automatic
Despite its popularity, it’s not been easy for every business to follow the trend. They cannot simply switch out manual processes for automated ones. The Mittelstand are a case-in-point.
Earlier this year, Jitterbit conducted a different in-depth report targeting senior professionals from DACH companies (Germany, Austria and Switzerland) to find out how they manage rapid digital change. Specifically, the study focused on so-called Mittelstand companies—enterprises of 500 people or less.
The Mittelstand has traditionally been the engine of these countries’ economies. Yet, despite its importance, what emerged is a continued widespread reliance on manual data processes. According to this second survey:
- 89% of those surveyed are running more than 20 manual processes
- 51% are running more than 50
- 24% more than 100.
Perhaps surprisingly, this is less than in some other European countries, such as the United Kingdom, where businesses have adopted automation more rapidly. This is significant because a reliance on manual processes makes Mittelstand businesses less efficient —and less capable of overcoming challenges such as lingering pandemic effects and/or the changing dynamics within the global economy.
What is holding the Mittelstand back?
Digging further into the study’s details, most respondents are aware that their inability to integrate disparate, disconnected systems prevents them from introducing deeper automation. They recognise data silos exist, and these deny leaders a complete view of a businesses.
Supporting this, the research found:
- 73% of respondents agreed or strongly agreed there are too many disparate systems in use in their organisations
- 76% confirmed struggles with data silos
- 79% overwhelmingly agreed there is an ongoing challenge to deliver a complete picture of the business from a data point of view.
The conclusion to draw is that these Mittelstand businesses are stifling themselves at the worst possible time. The health of every mid-sized business depends on its ability to make data-led decisions at any given moment. Such data is what should enable these businesses to:
- understand their customers
- continually optimise their operations
- capitalise on new opportunities with confidence.
For this to happen, business and their IT processes must first integrate and then automate. For example, over three-quarters of companies (79%) agreed they are less competitive because they are yet fully to achieve this.
Positive signs
It is not, however, all doom and gloom across DACH. The businesses surveyed are aware of the challenges—starting with integration. Most accept that automation will not happen without integration.
In this context, 47% of the Mittelstand businesses surveyed said they aimed to have integrated between half and two-thirds of their systems within the next year.
That is a pretty good start. And for those companies that are laying the building blocks for hyperautomation—the goal (automated and integration) is clearly in sight. To back this up, 38% aim to be fully automated in the next two years.
Crucial steps
So what can we learn from how the Mittelstand is approaching hyperautomation? While the Jitterbit research focused on DACH, the lessons can apply to any business confronting a transformation challenge.
First, integration is the crucial initial step, a step that can be taken with some external support. Indeed, most businesses surveyed outlined the most popular path to shifting themselves into a position to integrate and automate. This is through partnering.
Partnering with an integration platform provider ranks as the number one way for Mittelstand businesses to integrate, selected by 77% of respondents. A partnership with an integration platform-as-a-service (iPaaS) provider offers a high-speed route to building out and executing a hyperautomation strategy.
Indeed, most of the businesses surveyed seem to believe this approach would be transformative. Almost a quarter (24%) said their number one reason for embracing integration was to reduce costs. This aspiration was closely followed by the hope they could then introduce real-time data-led business decisions (chosen by 22%).
Hyperautomation: a new era to come?
Disruption is the new status quo. To survive and thrive, the Mittelstand (and beyond) must be able to innovate quickly. This may mean exiting old business models (if required), as well as being able to address new ones.
To do this competitively, in an era of hyperautomation, requires every business to adopt strategies for API integration and hyperautomation. Whether this is executed internally or via a partnership with an iPaaS provider does not matter. Catching up does.
To find out more, download the second report here:
Jitterbit, the API transformation company, makes it quicker and easier for businesses to exploit data from any source, empowering them to rapidly innovate and make faster, more effective decisions. The Jitterbit API integration and low-code application development platform enables companies to quickly create and connect SaaS, on-premise, and cloud applications and instantly infuse intelligence into any business process.
