Scaling Digital Transformation for Small & Medium Enterprises

Small and Medium Enterprises serve as the backbone of the global economy due to their major contribution in the areas of productivity, commerce, and employment. Thus, SMEs are a crucial contributor to the Indian economy. The fourth industrial revolution mainly focused on manufacturing process enhancement through the internet of things (IoT), cybersecurity systems, artificial intelligence (AI), and cloud computing.

For digital transformation programs, SMEs are migrating from start-up to scale-up mode. Flat hierarchies, increased leadership visibility, and quick decision-making provide these organizations a competitive advantage.

Digital Transformation And SME’s

Digital Transformation leverages and gains from technology in  the following manner:

• Optimizing corporate processes and functions
•  Bringing value
•  Increasing productivity.

Ultimately, SMEs will need to consider all parts of their operations to achieve digital transformation. A thorough examination of their business may necessitate creating or enhancing existing business processes, practices, workflows, and procedures.

Firms use digital transformation to position themselves for better long-term growthThere are reasons for this, such as desire to stay competitive by lowering overheads, raising revenue, or enhancing productivity.

A Chance for SMEs To Grow

SMEs can automate redundant, repetitive, and error-prone activities and tasks by modifying and enhancing their processes with digital technology. Overall, this will allow for more significant decision-making and efficiency.

SMEs Face Difficulties

In a developing country like India, SMEs are critical in providing jobs to millions of people. However, factors such as adequate credit availability, storage issues, procurement, designing and packaging, global market access, skilled labor, low technology exposure, tax-compliant processes, and proper infrastructure planning impact its ability to perform dynamically in international markets.

SMEs can overcome talent shortages by implementing the following strategies:

•       Existing workforce reskilling and upskilling
•       Model of co-creation and development (developing the product “with the client” rather than “for the client”)

·        Digital initiatives might be outsourced.

Successful Transformation

Here are some of the fundamental components involved in a successful transformation:

Mobile presence: SMBs used to be good with a conventional website, but now consumers expect a fast, fluid mobile experience. This is especially critical for small enterprises.

Enterprise apps: These rework daily operations such as ordering, reporting, marketing, and planning into efficient processes that can be managed through user-friendly apps. They reduce internal misunderstandings by ensuring that everyone has the most up-to-date information in their hands. Enterprise apps used at the strategic level remove unnecessary operations, increase efficiency, and boost staff morale.

Automation: While the digital revolution generates a lot of work, much of it can be automated. Creating a set of operations that activate additional actions or processes without checking with a human beforehand is known as automation. Creating order confirmation emails when a customer completes an online transaction is one example. After an error has been reported, automation can also lead a consumer through basic troubleshooting.

Creating a Level Playing Field

SMBs are, in many ways, better positioned than large corporations to profit from digital transformation. Approximately 46 percent of SMBs believe that their size gives them an advantage in overcoming institutional resistance to new technology adoption. They have less red tape surrounding their decision to go digital, and they stand to gain more by doing so. When companies do commit to digitalization, their efforts are often fruitful. 

Despite the hurdles, SMBs should prioritize digital strategy. It’s a game-changer. According to half of industry professionals, technology levels the playing field between small enterprises and major corporations. Thus, the most sure-fire approach to optimizing an SMB’s resources and gaining an advantage over larger competitors is digital transformation.

The Bottom Line

Small and medium-sized businesses (SMEs) account for around half of global GDP and employ two-thirds of the workforce. Thus, their transition is a high-stakes bet for the global economy and the ecology that surrounds it.

Scaling their digital activities is not an option but a survival need to assure business continuity and growth, especially in light of the pandemic and the ever-evolving tech scenario. Therefore, it is the ideal time for business executives to widen their transformation efforts across the board.