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New Zealand mid-market businesses are banking quick gains following cloud software upgrades, with more than 80 per cent seeing a return on their investments within 12 months
Business management platform MYOB polled over 500 leaders and decision-makers from businesses with between 20 and 500 full-time staff and more than $5 million in revenue to reveal that just under one-in-five experienced a positive impact or saw a ROI immediately.
A further 28 per cent saw benefits within six months.
Returns sought from their technology investment included revenue growth (64 per cent), efficiency gains (58 per cent), cost savings (55 per cent) and improved customer satisfaction (39 per cent).
MYOB’s executive general manager of enterprise and practice, Kim Clarke, said the poll demonstrated why mid-market leaders could be confident investing in their software in 2025.
“We know that for many mid-market operators, quantifying cost-benefit scenarios and ROI around new digital solutions or software upgrades can be challenging, but it’s essential to their business case in order to get buy-in and support from senior leadership,” Clarke said.
As enterprises ride out economic headwinds and a tight spending environment, it was important leaders understood and felt confident their investment in new digital platforms would see them get a “jump-start” on competitors as conditions improved, Clarke said.
As for those economic headwinds, 79 per cent of the Kiwi mid-market leaders and decision-makers surveyed expected the economy to improve in the next 12 months, with 15 per cent predicting a significant improvement next year.
Meanwhile, 12 per cent of those polled expected the economy to remain the same, while nine per cent believed it would decline.
Tim Ryley, managing director of MYOB partner Endeavour, said the mid-market was more than ready to push past the economic challenges of the last couple of years.
“Business leaders can see that light at the end of the tunnel now, and there’s been a really clear shift in mindset, compared to this time 12 months ago,” he said.
However, while that positivity evident and commitments rolled in for the new year, it hadn’t consistently translated to putting pen to paper just yet.
“Once we get past the holiday period, I think we’ll move beyond this latency gap between optimism and action, and see businesses ready to take advantage of what a modern ERP system offers,” Ryley said.
The MYOB survey found cloud-based technology was used by the mid-market across a range of business functions, including finance and accounting operations (50 per cent), asset and inventory management (41 per cent), project management (31 per cent), and supply chain resource management (29 per cent).
Nearly half of those surveyed plan to add, improve or upgrade their finance and accounting software in the next 12 months, while 45 per cent had ERP upgrades in their sights, followed by customer relationship management with 42 per cent.
“Understandably, given local economic conditions, we’ve seen the local mid-market take a measured approach to cloud software investment over the last couple of years,” Clarke said.
Now, optimism was increasing, revenue and sales pipelines growing and more than half of those polled aimed to expand their businesses in the next five years.
“There’s a large number of medium-sized companies in New Zealand that are still on legacy ERP products, or they’re using a mixture of applications across different areas of their business, with disparate data sources,” Endeavour’s Ryley said.
Customers were also looking to consolidate their legacy applications into one cloud-delivered solution with additional functional benefits.
“Now we’re past the early adoption stage for cloud software, there is a groundswell building of mid-market businesses recognising the benefits of making a change,” Ryley said.
After project completion, customers normally saw some quick wins within a few months, but given the all-encompassing nature of ERP, the nine-month period after go-live was critical to unlocking benefits and getting processes flowing, he said.
“Once they really understand the software, we find customers then come back with a new cycle of updates and features they’d like to optimise.”
MYOB’s survey also highlighted the top factors influencing digital solution buying decisions among mid-market firms. Employee user experience took priority (44 per cent), followed by reliability (40 per cent), convenience (31 per cent), and affordability (31 per cent).
Leaders were homing in on the digital investments that would lift their performance and accelerate growth, Clarke said.
New Zealand industrial automation firm John Brooks and the University of Canterbury Students Association were both recently shortlisted as finalists in the business of the year award for their adoption of cloud ERP solution MYOB Acumatica in the inaugural MYOB Acumatica Awards for 2024.
MYOB’s research was conducted in September, 2024.