The good news is that we already know quite a bit about the challenges facing SMBs in the Asia-Pacific region. In an IDC survey on Asia-Pacific SMBs commissioned by Cisco2, we found that SMBs are focused on being as competitive as possible.
Figure 1
Their top business priorities are around reducing costs, followed by improving operational efficiency and productivity, and then differentiating themselves through improving their product and service portfolio. Managing cash flow and investing in customer acquisition rounded out the top five priorities.
Figure 2
At the same time, they face challenges such as the escalating cost of operations, struggle with new business models such as rentals and monthly subscriptions instead of outright purchases, and customers who want to browse, consume and pay in new ways.
We can see that technology is part of the SMB Growth Formula. Today’s digital technologies help businesses do more with less and come up with innovations that could disrupt industries.
SMBs should keep up with technology news and consider investing in the latest technology. SMBs in Singapore which apply digital technologies will stay competitive, according to the eighth annual Asia-Pacific Small Business Survey by CPA Australia3. Artificial intelligence (AI), cloud, and advanced collaboration are some of the innovations that could change the way businesses work and facilitate the introduction of disruptive new business models.
Such technologies enable new customer experiences and offer insights that help SMBs improve their product and service offerings, predict future purchases and fine tune the customer experience4. Customers are more demanding than ever before. Providing them with an excellent experience both online and offline will be key to customer acquisition, customer retention, and brand differentiation.
According to the IDC research5, Asia-Pacific SMBs are aware that technology is useful. Nearly three quarters of respondents (74 percent) said they wanted better tools to improve business decisions, while seven in 10 (71 percent) aimed to align or adapt IT to changing business needs. They prioritized cybersecurity (84 percent) and improving the productivity and skillsets of their IT teams over innovating with technology, however.
Figure 3
Figure 4
In the IDC survey5, all SMBs had switches and routers, and seven in 10 had Wi-Fi connections. The smaller SMBs6 fell behind their larger counterparts when it came to additional technology investments, which range from cybersecurity to servers and storage as well as network management software and cloud.
A key ingredient of the SMB Growth Formula is going beyond basic connectivity – the switches, routers, and Wi-Fi. Cloud is an important step to consider, as it facilitates disruptive business models. Grab, AirBnB and Hulu are all enabled by cloud computing.
As more and more devices get connected, SMBs could potentially receive valuable data from right across their supply chain. Analyzing such data could point the way towards new ways of doing business and suggest how customers can be better served4.
Figure 5
SMBs invest in new technology for many reasons, from replacing obsolete and faulty solutions to moving offices. The top reason – and part of the SMB Growth Formula – is that the new technology supports workforce mobility. Nearly half (47 percent) of SMBs said they adopted new technology to help their employees work outside of the office.
SMBs need to attract and retain good people, and that means empowering employees so that they feel engaged, productive, and valued with the right technology solutions4. With secure solutions that allow employees to be more connected, engaged and mobile SMBs win8— employee loyalty rises, the millennial workforce gets the flexible working styles they prefer, while older workers can contribute longer from home.
The IDC research has shown that larger SMBs are using unified communications and collaboration (UC&C) to complement their customer relationship management (CRM), accounting, enterprise resource planning (ERP) and other business applications, as well as cloud-based solutions so that they can do more with less5.
Secure cloud-based applications and UC&C solutions also enable SMBs to be more versatile9. More than a quarter of the world’s freelancers (28 percent) are based in Asia10, after all. SMBs can draw on freelancers’ niche skillsets and third-party capabilities on an as-needed basis, expanding the breadth of their portfolios.
Cybersecurity matters more than ever when the workforce is mobile, increasing the number of potential entry points for hackers. The best technology to invest in must be both powerful and easy to use when SMB budgets are finite, teams are lean and not necessarily tech-savvy. This recommendation is distilled for the SMB Growth Formula as focusing on simple, smart and secure technology solutions.
Look for solutions that offer ease of use and manageability, and which also feature rich built-in capabilities like self-reporting, monitoring and automation.
Last but not least, security must be built into everything to keep business assets and communications safe. For peace of mind, there should be three-way 24x7 policy-based cyber threat protection across mobile devices, the company network, and the cloud4.
Gone are the days where SMBs bought equipment and were left on their own. Today, the best technology partners are those which are committed to helping their customers grow for the long term.
The SMB Growth Formula includes taking the time to choose the perfect partner. SMBs should look for someone who:
Has a proven track record with technology
Provides superior technology, be it better technology, or more innovative technology, as can be seen through the existence of patents by that company
Understands SMBs, so that they offer useful advice and insights on how to succeed. This understanding also influences how effectively they can tailor their technology for SMB needs
Supports customers the way they want to consume products and services, through pay-as-you-go models or leasing for instance
Offers affordable hardware, software and service bundles that work seamlessly together
Being there for the long term is critical. Financial stability is a must.
In summary, the SMB Growth Formula is about how SMBs can refine their strategy to stay agile, so that they keep up – or surpass – the competition. With all the ingredients of the SMB Growth Formula on hand, an SMB can blend its own version of it for success. Good luck!
1 Asia-Pacific Economic Cooperation Small and Medium Enterprises Working Group home page 2 SMBs Shift Into High Gear for 2018: Staying Secure and Current, October 2017, 3 The Business Times. Singapore small businesses more upbeat about prospects this year: CPA Australia. March 15, 2018 4 Digital Transformation at Cisco 5 SMBs Shift Into High Gear for 2018: Staying Secure and Current, October 2017 6 Smaller SMBs are defined as those with 100-249 employees. Larger SMBs have 250-499 employees. 7 Digital Transformation at Cisco 8 SMBs must understand digital is the expectation, not aspiration 9 SMBs Shift Into High Gear for 2018: Staying Secure and Current, October 2017, 10 Inc., This Survey of 21,000 Freelancers From 170 Countries Shows What Having No Boss Is Like, October 27, 2017
