The Philippines is gaining stronger technology capabilities. Source: Shutterstock

The Philippines is gaining stronger technology capabilities. Source: Shutterstock

Amid digital disruption, SMEs in the Philippines being driven to transform

SMALL and medium enterprises (SMEs) serve as the driving force of a country’s economic growth. This is mainly because they make up a large part of the business landscape in certain countries, especially in Asia.

In the Philippines, there are 4,769 large enterprises, 106,175 small enterprises, 4,895 medium enterprises and a whopping 887,272 units of micro business establishments.

SMEs alone have managed to create over 2.5 million jobs in the country, further signifying the vitality of these establishments to the country’s development.

Due to the fact that they greatly influence the country’s income rate and development, they must be able to constantly meet the global industrial demands, evolve alongside the new globalization standards and catch up with the digital world.

The wave of digital disruption has hit the Philippines’ SMEs, so business leaders must respond proactively by embracing technology solutions and be more digitally-enabled.

“To be able to tap business opportunities in the evolving digital economy, digital transformation is key. This must be done, or else, a company will be left behind,” said Institute of Corporate Directors President Alfredo Pascual during a recent conference.

As the country gains new digital capabilities and advances its technology development, it is imperative that SMEs go digital.

New and emerging technologies can be a threat to businesses that fail to innovate and keep up with the latest advancements.

Capabilities like digital payment systems are core to SMEs as they are increasingly sought after and help stay relevant in an ever-evolving marketplace.

Pascual also said that as digital disruptions intensify, it is highly critical for SMEs that wish to succeed, to push forward with innovative efforts and reinvent their identity and culture.

The transformation is necessary not only to secure greater revenues, but also to increase operational efficiency, boost data-reliance, improve marketing, and enhance research and development.

An economy expert at the conference further supported this notion by stating, “[…] the ability to innovate will become — more than ever — an important element of economic development.”

Thankfully, SME leaders that are more aware, dynamic, digitally-literate, and generally younger, are progressively going digital.

On that note, Pascual urged those in the country to embrace the change by enhancing digital skills to empower greater engagement.

At the same time, he also acknowledged the struggle and new challenges that SMEs have to face amid the digital disruption, citing limited resources and business services, lack of data as well as “constrained access to markets beyond their immediate neighborhood”.

To counter this, Pascual called for a thorough improvement of internet bandwidth and prices to allow SMEs to access digital marketplaces and online services.

Of course, the government bodies are responsible to solve this issue which is why he insisted that they lead by example, digitizing efficiently and working towards bettering the means to transform.

All in all, the government must heed the call to go digital by providing SMEs with the necessary aid and incentives.

Meanwhile, SMEs must charter plans to innovate within their means and seek viable solutions that can help their businesses flourish.