Many owners of established SMEs feel that running a business has become more demanding, even when turnover is holding up. Decisions feel heavier. Margins feel tighter. Competition seems to arrive from unexpected directions.
The instinctive response is often to work harder, add activity or push for more output. But the real shift happening around us suggests that this approach will deliver diminishing returns.
What is changing is not just how fast organisations operate, but how they deploy people, data and capital to create impact.
The Rise of the “Superfluid” Organisation
Recent global discussions have highlighted the emergence of what some call the superfluid organisation. Stripped of jargon, the idea is simple.
In these organisations:
- Data flows easily to inform decisions
- Talent is deployed flexibly rather than locked into rigid roles
- Capital is allocated quickly to where it creates the most value
- Technology handles routine disruption
- People focus on judgement, creativity and decision-making
Productivity is no longer measured by output per hour, but by the quality and impact of output relative to the level of supervision required.
This is already how many global organisations operate.
Why UK SMEs Will Feel This First, Not Last
It is tempting to dismiss this as something that only affects large corporations. That would be a mistake.
As global organisations become both scalable and nimble, they are increasingly able to move into small, specialist or local markets that were once the natural territory of SMEs. When scale and flexibility combine, traditional advantages such as proximity, heritage or niche focus can erode quickly.
This is not about good or bad behaviour. It is about capability.
For UK SMEs, the pressure often shows up indirectly:
- Margins tighten without an obvious cause
- Competitors appear with sharper pricing or faster delivery
- Customers become less loyal and more value-driven
The market becomes less forgiving of inefficiency, delay or internal friction.
Why Productivity Feels Different at This Stage
In the early years of a business, productivity is intuitive. The owner is close to customers, decisions are fast and problems are visible.
As the business grows, productivity becomes harder to define:
- Teams are busy, but progress feels slower
- More decisions land back with the owner
- Systems creak under increased complexity
- Supervision increases rather than decreases
At this point, productivity is no longer about effort. It is about how work flows through the organisation.
Rethinking Productivity for the Next Phase
For established SMEs at a point of transition, improving productivity does not mean copying global giants. It means asking sharper questions about where friction exists.
Common sources of drag include:
- Unclear priorities that dilute focus
- Processes that rely on individual knowledge rather than shared systems
- Poor or delayed data that slows decision-making
- Skills gaps that require constant oversight
- Over-dependence on the owner to resolve issues
None of these are signs of failure. They are normal consequences of growth.
The risk comes from leaving them unaddressed.
A Practical Starting Point
Rather than searching for a perfect future model, the most effective SMEs take a pragmatic approach.
Start by asking:
- Where does work slow down unnecessarily?
- Which decisions require more supervision than they should?
- What information do we lack when we need it most?
- Where are capable people constrained by process or structure?
Small, deliberate changes in these areas can significantly increase impact without adding cost or headcount.
What This Means for SME Leaders
The competitive environment facing UK SMEs is not getting simpler. But it is becoming clearer.
The businesses that thrive will not be those that work the longest hours or chase every new idea. They will be the ones that:
- Reduce friction
- Improve decision quality
- Use technology to support, not complicate
- Allow people to operate with greater autonomy and accountability
In other words, they will become more fluid in how they operate, even without the scale of global organisations.
A Final Thought
There is a familiar leadership lesson that remains as true as ever: what got the business here will not automatically take it forward.
For many established SMEs, now is the moment to step back and assess whether the way the business operates is fit for the next phase. Not in search of perfection, but in pursuit of clarity, focus and resilience.
If the business feels busy but progress feels harder won, that is often the signal to rethink productivity before the market forces the issue. At UK Business Advisors we can help you!