Think Big: Empowering Businesses to #RiseTogether
With the pandemic disrupting several industries and age-old business models, a large number of small and medium enterprises have embraced the ‘digital first’ mindset to convert challenges into opportunities.
PremiumToday, over 6.3 crore MSMEs employ approximately 11 crore Indians across domains, and contribute to around 29% of the nation’s GDP. Digital transformation has been a game changer for several industries and while bigger firms have been quick to invest in technology, smaller firms have been comparatively slower.
However, between the large and small, a McKinsey study identifies ‘The Missing Middle’. The gap between large and small enterprises is huge which can only be bridged by creating a sizable middle.
India’s economic success will largely depend on these mid-size firms who have the potential to grow large but are often held back by certain constraints and limitations.
Recent events have shown that technology, if leveraged well, can address these constraints and limitations. For India to achieve its productivity and job creation goals, 10,000 or more small companies will have to scale up to become mid-size by 2030. And if these enterprises are provided access to the right technologies, rapid scaling can be achieved as well as sustained.
With the pandemic disrupting several industries and age-old business models, a large number of small and medium enterprises embraced the ‘digital first’ mindset to convert challenges into opportunities. This acceleration towards digital could become the lever for the future success of the MSME sector.
In fact, It’s not just the pandemic that has expedited technology adoption among SMEs, but there are other critical factors too:
- The openness of SMEs towards understanding state-of-the-art technology solutions.
- Emphasis of small and midsize businesses on operational agility and process automation.
- The valuable contribution of R&D institutions in providing the essential technical support.
- SME-friendly government initiatives under the umbrella of Digital India.
- Fiscal incentives and design assistance programs customized for SMEs.
According to a study, digital technology adoption among MSMEs will grow at around 25 per cent CAGR to around $85 billion in 2024.
The Direct and Indirect Benefits of Digital Transformation
The aforementioned factors have enabled SMEs to digitize various functions within their organization including customer relationship management, supply chain operations, HR, marketing and finance. A quick move towards adoption of new-age deeptech including AI and IoT solutions is also quite visible. Global market for AI in big data and IoT as a whole will reach $27.3B by 2026. Implementation of cloud services and SaaS based products has also increased by double digits across all categories including web conferencing and security. But why this change?
Cutting-edge technologies across domains have helped SMEs in various areas of business growth, employee development and customer centricity. By embracing tech solutions, several SMEs have experienced:
- Integrated, more transparent processes
- Significant operational cost reduction
- Better talent management capabilities
- Enhanced competitiveness
- Improved Agility and responsiveness
- Data-driven decision making
Executives across domains suggest digital transformation’s top benefits include improvement of operational efficiency (40%), faster time to market (36%), and meeting customer expectations (35%). These benefits have implications that can change the course of the entire business launching them towards newer opportunities that they would not have explored otherwise.
How government programs and tech enablers are catalyzing SME Growth?
Under the ambit of Digital India, the government is empowering small and medium size enterprises with platforms like MSME Sampark, where jobseekers (students/trainees of 18 MSME Technology Centers) and recruiters can register themselves for getting employment and acquiring talent respectively. Another significant step has been the launch of
CHAMPIONS - a digital portal for redressing and managing SMEs grievances related to finance, raw materials, labour, regulatory permissions, and more.
Tech giants like SAP are also playing a major role in this growth, as they understand the challenges and most critical priorities of SMEs. Future-ready programs such as Global Bharat, Rise with SAP, and Growth Matters Forum are enabling small and medium size businesses to sail through supply chain disruptions, evolving customer expectations, and market uncertainties.
-Under Global Bharat, SMEs are leveraging the largest digital B2B marketplace with a vast network of 4 million suppliers across 10 countries. The program also covers the skilling, re-skilling, and upskilling of the SME workforce, with more than 240 curated courses (available on Code Unnati app) on digital financial management, digital marketing, entrepreneurship, and much more. The recently launched initiatives like Mentors of Global Bharat Series and Dare2Dream Awards 2021 will connect aspiring entrepreneurs with industry leaders and recognize visionary SMEs that have the will to handle digital disruption and reimagine business models.
-RISE with SAP is helping SMEs with guided digital journeys to transform their business. They can avail customized, bundled solutions like business process intelligence and business technology platform to SMEs, to achieve their most critical goals. They can analyse and benchmark their existing processes against industry standards to get tailor-made recommendations.
-Growth Matters Forum is an online community of 35k+ business owners to build relationships with like-minded individuals, and share peer to peer learning.
Members can access all the SME-centric news and updates, along with resources on financial education, digital marketing, e-commerce, talent acquisition, digitization, and much more.
We all have grappled with the pandemic, and now we all are rising together with our extraordinary efforts and inclusive approaches. Parallel initiatives and investments from the government and big corporations to catalyze SMEs' rise, perfectly captures this togetherness.
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