Survey says: Midsize businesses likely to grow, invest in 2015

As 2014 draws to a close and businesses are looking toward 2015, the inaugural survey from The Hartford’s 2014 Midsize Business Monitor found that a majority of midsize business owners are optimistic about the economy and plan to make key investments to drive growth for their companies, including investments in operations, technology, and new products and services, as well as adding staff and expanding into new markets.

According to the survey, 66% of midsize business owners and C-level executives are optimistic that the national economy will strengthen in the next six months. Showing their optimism, these businesses indicated that, in 2015, they’re likely to make investments in the following areas:

• Technology (88%)
• Operations (87%)
• Additional staff (74%)

As for growth opportunities, a majority of midsize business owners and executives said they’re looking at:

• A new product service or offering—76%
• New customer segments—70%
• New geographies—61%

“Midsize businesses are vital to the U.S. economy, fueling growth as both customers of and suppliers to smaller and larger businesses,” said David Carter, senior vice president of Middle Market insurance at The Hartford, in a prepared statement. “The investment and expansion plans of businesses in this sector create a ripple effect of opportunity for companies of all sizes that provide the products and services they will need.”

Hiring challenges

In the 12 months prior to the survey, 85% of businesses hired employees, and a majority (74%) plan to add staff in 2015. The businesses found hiring a challenge, however: 40% said they hired fewer employees than they wanted, with 61% citing a lack of qualified talent to fill the positions as the reason.

At the same time, 45% of businesses responded that they were able to hire as many employees as they wanted.

Your smartphone or mine?

According to the survey, the majority, or 71%, reported that they’re using employer-owned mobile devices, 53% use cloud computing, and 53% are using Internet telephone service technology. When asked about BYOD or “bring your own device” policies, more than one-third of the businesses surveyed reported allowing employees to access company systems using their personally owned technology devices, which include smart phones, tablets, and personal computers. Nearly a quarter of the midsize businesses in the survey reported that they are currently using big data technologies, and an additional 42% are “somewhat likely” to use them in the next three years.

Drones and driverless vehicles on the horizon

Showing their embrace of technology in multiple aspects of their operations, many midsize businesses are considering adding innovative technologies in the near future.

• 36% are looking into Automatic Identification and Data Capture (AIDC) technologies, such as magnetic stripes, bar codes, biometrics, and smart cards, for example
• 35% are considering 3-D printing
• 35% are thinking about using wearable technology
• 13% are considering the business use of drones
• 12% are considering autonomous/driverless vehicles

“The adoption of these newer technologies is closer than many may realize. As midsize businesses pursue growth and integrate new technologies into their operations, the insurance industry will need to be ready to address these new types of risk,” added Carter in his statement.

How the survey was conducted

The Hartford’s 2014 Midsize Business Monitor was fielded from September 16-23, 2014. More than 500 owners (including partners, principals, and presidents) and C-level executives of midsize businesses headquartered in the U.S. with annual sales or revenues of $10 million to $1 billion participated in the online survey, which had a margin of error of +/- 4.3 percent at the 95 percent confidence level.