CEO of Acumatica, a fast-growing cloud ERP company, John Case has nearly 30 years of industry leadership in cloud services.getty​I remember sitting in one of my first customer meetings as a CEO. A manufacturer told me he loved our product, but until it could handle one specific piece of scheduling functionality, he couldn't run his whole operation on it. This was a revelation, as the information I received from my own team had been filtered so many times I didn't know what the reality was. That gap between what leaders think is happening and what's actually happening on the ground is often where modernization stalls.​Experiences like mine matter far beyond a single storefront. Small and mid-sized businesses make up 99% of all U.S. companies and employ more than 60 million people, representing nearly half of the workforce. The stakes of helping these businesses succeed in the digital, AI-empowered age are high, not only for the employees who work there but also for the communities they serve.​Fortunately, the modern and advanced technologies that once felt out of reach for small to medium-sized enterprises (SMBs) are now more accessible than ever before, giving these organizations a clear path to modernizing and embracing the change that will come with that process.​Innovate Or Fall BehindWhat do struggling businesses have in common? They offer quality products and services, have loyal customers and play important roles in their communities. But many fail to modernize, and it costs them.​Meanwhile, their competitors reap the benefits of modern technology, including expanding online sales, automating inventory management and personalizing marketing efforts. By today’s standards, standing still is the same as moving backward.​​One of the most common traits of any successful business is adaptability.​SMBs generate 35% of U.S. business revenue, serving as the catalyst to local, community-based economic mobility. These days, it doesn’t matter what industry you’re in. To succeed, SMBs across diverse sectors, including retail, manufacturing and professional services, among many others, must adopt technologies like AI, machine learning and automation to transform their operations and keep pace with or stay ahead of competitors.​Businesses that delay evolution often face challenges, including:• Operational Inefficiencies: Duplicated efforts, lack of visibility and insights and reporting errors are all symptoms of inefficient operations. These errors cost you, but if you address them head-on, you can protect your bottom line.• Customer Churn: As quickly as technology advances, so do your customers. If you’re not keeping up with them, they’ll take their business elsewhere.• Talent Attraction And Retention: Good talent is hard to retain. If you’re not delivering the tools that employees want to use, you risk attrition with talented workers leaving for greener pastures. • Market Irrelevance: Falling behind competitors can be one of the hardest holes to climb out of. Modernization is one tool at your disposal to avoid falling behind in the first place.• Poor Strategic Decision Making: Without accurate, up-to-date data, you’re left blind to your business. In my experience, the decisions that are most detrimental are the ones made without the full picture.​Cloud-based business management platforms give SMBs the ability to automate repetitive tasks, improve forecasting, streamline operations and make faster and more informed decisions, without the complexity or cost barriers that once stood in the way.Overcoming The Fear Of Change​I’ve seen business leaders mistake caution for strategy. I get it—shifting long-standing operations and training employees on new processes takes real time and resources. But waiting doesn’t reduce risk.​I saw this play out firsthand during my years helping scale cloud adoption at Microsoft. We were often ahead of what customers thought they needed. And we weren’t afraid to tell customers that we were ahead of where they were and showing them the benefit of closing the gap. I got to know CIOs and IT executives all over the world during that time, and most of them weren't asking for the cloud. They had systems that worked, more or less, and change felt unnecessary.​But I remember one CIO who was willing to start early. He looked at the full landscape, saw that the economics made sense and realized the cloud was going to solve real problems for his business. His attitude became: why wouldn't I bet on this? He later told me, “I’m a complete convert.”​That same logic applies to modernization more broadly. The businesses that move early understand that change is hard, but when they look at where technology and business operations are headed, staying put is not a viable option.​5 Essential Steps To Modernization​The best way to move forward is by taking consistent steps toward where you're headed, at whatever pace makes sense for your business.​1. Assess Your Current OperationsTake a step back. Is what you’re doing now producing the results you want and need to remain profitable?2. Set Clear Modernization GoalsIdentify areas of improvement and set goals. Work backward and evaluate the steps needed to get there.3. Start With Manageable ChangesLong-lasting change doesn’t happen in a day. Don’t overwhelm yourself with a comprehensive overhaul on a tight deadline. Prioritize goals by level of investment and impact and start small before going big.4. Upskill Your WorkforceSet your employees up to be successful by training them on new software and AI capabilities. Clearly articulate the impact of the changes to their day-to-day processes and how the new approach will ultimately benefit them.5. Seek Trusted Guidance And ExpertiseMany businesses are going through similar modernization efforts. Don’t forget to learn from those around you and seek advice from seasoned implementation partners.​The number one job of a leader, in my opinion, is to build and cultivate the right team, and then give them the culture and the tools to thrive and succeed. Modernization is part of that. Small, intentional changes build momentum over time, helping you improve operations, attract and retain good people and position your business for long-term growth while holding true to what made it successful in the first place.​It’s not too late to start. Modernization begins with a willingness to adapt. For many SMBs, future growth and long-term success will depend on it.​Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives. Do I qualify?