Small business owners need to invest in the right digital technologies. Source: Shutterstock

Small business owners need to invest in the right digital technologies. Source: Shutterstock

IDC: 84pc of SMEs in APAC understand the value of digital technologies

JUST A COUPLE of years ago, investing in technology was a luxury for small- and mid-sized enterprises (SMEs). Today, it is a necessity.

To stay relevant in the market, SMEs need to go digital, investing in technologies that automate processes and augment experiences, to delight customers and deliver on changing and evolving expectations.

Digital makes new products and business models possible, and that’s critical to creating growth and boosting profits.

According to the new IDC 2019 Future SMB Pulse survey, 84 percent of SMEs in the APAC recognize the need to use digital technologies to make significant changes in their company’s processes and operations, and to become more competitive.

Of those, 39 percent have already started their journey and are at different stages of digital maturity, and another 42 percent are planning to start.

In the next three to five years, IDC’s analysts believe that up to 60 percent of the SMEs in the APAC will have achieved some degree of digitization — which is a promising statistic at the regional level.

What’s driving the push for digital among SMEs?

IDC’s study found that investment in technology over the next 18 months will be driven by priorities such as improving revenue growth, increasing efficiency/productivity, and reducing costs/expenses.

More specifically, it seems as though SMEs in the APAC will be motivated to explore digital technologies in a bid to fill in gaps and take up opportunities created by the digital economy.

“The rise of the new digital economies, such as the last mile economy, the gig economy, and the marketplace economy, will force SMEs willing to benefit from the opportunities presented by these new economies to make investments in digital technologies, and become them more competitive,” said IDC APAC Senior Program Manager Celeste Narvaez.

In light of the study, Narvaez’s colleague and IDC Digital Transformation, Future Enterprise, and SME AVP Daniel-Zoe Jimenez explained that although SMEs are extremely competitive and hungry for growth, their journey to technology adoption has been slow, primarily because they lacked the skills and resources to take the plunge.

“Widely available and easier to consume digital technologies are leveling the playing field between MNCs and SMEs. The market has reached an inflection point in 2019, forcing SMEs to act.

“Driven by the evolved state of digitalization of the SME ecosystem and the opportunity presented by digital technologies to amplify capabilities and competitiveness, SMBs must progress and evolve towards becoming Future SMBs,” Jimenez explained.

One piece of advice to SMEs going digital

Eighty-four percent of SMEs are keen on going digital in the APAC. To realize their digital ambitions, it is expected that they will make investments in things like big data, analytics, artificial intelligence, and other cutting-edge technologies.

However, the one thing that these business leaders must not ignore is cybersecurity.

The biggest advantage for SME business owners that have avoided ‘going digital’ is that they can now ensure that security measures are baked into everything they do in the digital world, right from the start.

From setting up social media accounts and securing them with two-factor authentication, to investing in a solid identity and access management solution to ensure only the right people gain access to critical business and customer data at the right time, putting good cybersecurity policies is key to suffering in the future.

In the coming months, neglecting to go digital will not be an option — but companies must take adequate precautions to protect the systems they invest in and the customer and stakeholder data they collect if they want to leverage technology instead of putting their future at risk.

At the end of the day, Jimenez emphasized that SMEs are ultimately responsible for their own growth and make their decisions consciously.

“They must recognize that their competition and ecosystem are transforming, and they must keep pace in order to survive,” concluded Jimenez.