A new reports shows that productivity and business development is being curtailed across many small and medium sized enterprises as a result of emerging skill gaps.
The report was compiled by MentorsWork, a collaborative venture of Skillnet Ireland and the Small Firms Association.
MentorsWork is designed for business owners and managers throughout Ireland and aims to boost SME productivity by providing mentoring and business development tools.
Its report today also reveals that many SMEs are struggling to access finance and financial supports.
The report determines several predictors of financial competency, with higher employee numbers, and companies in business for more than ten years more positively correlated with stronger financial literacy skills and higher capacity to execute effective strategic planning.
It also reveals that younger SME businesses score lower in the report's metrics in measuring financial literacy, financial analysis and understanding risk.
These businesses also have more difficulty with routes to accessing financing and financial supports, as do businesses with nine employees or fewer.
ICT and services are the sectors particularly challenged when it comes to financing needs, and the services industry is associated with lower levels of financial literacy in the report.
The research found that retail and hospitality, food and drink, and manufacturing firms report above average competency around financial planning.
SMEs involved in ICT are average, while services and all others rated below average.
Manufacturing, ICT, retail, hospitality and food and drink performed best when it came to assessing finances and risk, it added.
Sven Spollen-Behrens, Director of the Small Firms Association (SFA), said that while innovation and technological advances are critical in delivering increased productivity, SMEs crucially must have robust financial planning.
"It is critical that owner-managers of small businesses have up-to-date organisational and financial skills, including financial literacy, financial analysis skills and understanding risk, in order to implement the necessary changes to adapt to an ever-evolving business landscape," he stated.
