What’s the Digital Divide (And How to Stay On the Right Side)

Key Takeaways:

• There’s a business equivalent to the digital divide that separates populations and regions.
• That wide, persistent gap became exacerbated by the 2020 crisis, which suddenly made digital fluency an imperative.
• It is crucial for business leaders to accelerate technology investment — and to increase their organization’s “digital quotient” in order to do it right.

You may have noticed that businesses and organizations are not equal in the face of digitalization. There is marked disparity between digitally native and tech savvy companies that eagerly embrace emerging tech and harness it to their advantage, and more traditionally minded businesses where you might still find a fax machine in use (Yes. Really).

The divide, which has been widening with the COVID crisis, can have a huge impact on the future of your company. Especially if you’re on the wrong side of it.

The Hidden Dimension of the Digital Divide

In layman’s terms, the digital divide refers to “the gap between demographics and regions that have access to modern information and communications technology (ICT), and those that don’t or have restricted access”.

The media and ONGs often try to raise awareness to the connectivity gaps that typically exist between cities and underserved rural areas, where high-speed broadband coverage is hardly profitable, between younger digital natives and older adults, between developed countries and underprivileged parts of the world, between the educated and the uneducated…

But the media often overlooks the business version of the digital divide. However it is very real and laden with implications.

When it comes to businesses, the issue isn’t so much about access to connection and technology. If you leave out craftsmen or micro-businesses in disadvantaged regions of the world, you’d probably have a hard time finding a company without decent access to the Internet or adequate devices. Plenty of SaaS offerings come with pretty affordable price tags, with token-based pricing models to accommodate the use and budget of SMEs.

Yet some organizations and industries have been investing in digital tech heavily — and they are using their digital capabilities to transform and accelerate operations — while some of their peers haven’t.

Often because of cultural and organizational traits, organizations with comparatively lower digital maturity — typically but not solely in the spaces of catering and hospitality, construction, healthcare and education, government services, and more — are missing out on the opportunities brought forth by digital tech. And this could severely impact their performance, their competitiveness, and their ability to respond to challenges and opportunities.

The Digital Divide is Growing

The digital divide between businesses and industries is definitely not a new issue. But the gap has been exacerbated by the coronavirus pandemic. All of a sudden, lockdowns drove most economic activity online. The way we consume, work, learn, eat, and play went full digital overnight.

The ability to offer online products and services and to engage with customers 100% digitally suddenly became mission-critical. While some organizations already had the required toolset and process in place, other businesses were not prepared to face such a sudden shift and had to scramble to put together e-retail platforms.

In the same vein, businesses weren’t equally prepared to tackle the mass move toward remote working. Remote-by-design companies with state-of-the-art collaboration tools, robust cloud infrastructure, and digital-friendly workforce were able to navigate the disruption smoothly. Unfortunately, the same can’t be said of those businesses that were not equipped with systems and practices enabling anytime, anywhere access and collaboration.

The crisis that has impacted virtually every aspect of our lives has amplified both the benefits of digital “have” and the penalties of digital “have not”.

Overall, the pandemic has exponentially accelerated the need for digital transformation. Since the crisis broke, a staggering majority of businesses have stepped up their digital technology investment. But here again, there’s a marked distinction between the ROI of those digitally mature companies that were able to see around the corner and optimize their tech stack not only to weather the crisis, but also to prepare for the future, and of those business leaders who have invested in tech in “firefighting mode”, focusing on immediate priorities in hope to survive the crisis.

The technical debt of digital laggards is growing — and possibly reaching the point of no return.

How to Make Sure Not to Fall Behind

It’s now quite common to hear experts advocate for regulatory intervention to mitigate disparities and ensure equal digital opportunity across regions and demographics. However, it seems highly unlikely that such initiatives would come to the rescue of the businesses that are today at risk of falling on the wrong side of the digital divide. During lockdown periods, some governments were willing to chip in a few hundred bucks to help small shops to set up e-commerce platforms — and that’s pretty much it.

As a business leader, it’s on you to take decisive action to make sure your firm doesn’t lose the digital race.

This obviously requires accelerating your technology investment. It all starts by establishing solid IT foundations, with a robust data repository and enabling systems such as ERPs, collaboration and productivity tools.

The rest should come naturally.

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