The Daily Prosper
The future of SMEs: The digital transformation

The future of SMEs: The digital transformation

Spain is a country of SMEs. Most of the firms that make up the Spanish business network are small and medium-sized companies and, nevertheless, digitalisation is still a pending issue, but not only for them.


According to the European Commission, only 2% of the organisations that operate in the European Union (EU) are taking advantage of all the advantages offered by the new technological solutions.

These are figures that show all the work that remains to be done in this regard and a
challenge for SMEs to face if they want to get the most out of their business; for it is no secret that digitalised companies are more efficient and productive.

The target is now mostly online and uses the Internet to compare prices, organise travel or as a discriminatory factor to choose one cafeteria or another.

According to the ‘Analysis of the digitalisation of freelancers and SMEs’ study, 4 out of every 5 customers search online before buying, coffee shops with Wi-Fi sell up to 3 times more coffees, businesses with online advertising receive up to three times more calls and work in the cloud saves up to 20% of the time spent on meetings.

These are more than enough reasons to contemplate digitalisation as an investment and not as an expense or a practically unattainable challenge, but they are not the only ones.

Alejandro Javier Tosina, Economy director of Red.es, reminds us that this transformation "affects all users and all sales channels, the ways in which the companies are organised and the way of relating with the customers and suppliers. Those companies that do not adapt to the new digital economy risk being left out of the global market."

Companies now live in the extension of digitalisation and although they contemplate their transformation processes from a fairly optimistic perspective, they still have work ahead in this regard.

To successfully undertake this process, companies must, according to the director of Digital Economy of Red.es, overcome some barriers: "Conviction of their management structure and management levels. The resistance to change to a new way of doing things is one of the main limitations.

Believing in the new paradigm is key to dealing with a substantial digital transformation; knowledge, because it is essential to have specialised talent with the appropriate skills to implement the tools and new ways of acting in the digital environment; and the cost, because we must realise that the investment in both human and technological resources is, particularly in the case of SMEs, an important brake on starting up significant changes in the business model".

 

Being on the internet should be a priority for small businesses

Although we live in a digital world, most companies do not consider digitalisation as something urgent. This is a mistake, because only those that are at the forefront of the trends will be able to compete with the same weapons as the new digital native companies.

However, according to the ‘Study on the state of digitalisation of Spanish companies and public administration’, prepared by Vodafone, "digitalisation is only a spontaneous concern for 2% of most Spanish companies.

This percentage rises to 12% in companies with more than 100 employees and increases in those over 500". Some figures that show that SMEs do not have digitalisation in the top 3 of their list of urgent obligations 

Because before getting down to work on this transformation, they must devote most of their resources to more urgent issues such as taxation or the profitability of their businesses. In short, they are very much guided by the short term and do not understand that sometimes what is urgent is not always important.

 

Prepared for a digital transformation

It is true that digitalisation is not limited to designing a website. It is a whole revolution, a complete transformation that has generated a new commercial paradigm. The investment required therefore, in addition to the technologies, implies procedures and the organisation of companies that must incorporate a series of solutions, applications, uses into their business processes, as well as qualified profiles well-versed in the digital environment.

This process is therefore usually slow and expensive, especially for those medium and small companies with limited resources. But it is also essential for the survival of these companies. 

And, before all the obstacles that an SME can find in its transformation process, there are twice as many advantages in undertaking it. We thus find many reasons for carrying out the digitalisation of an SME, but we will summarise them in these five:

 

  1. It automates the processes, products and services generated by the company. A strong reason to wager on this transformation, since it makes the company’s work and organisation much easier.
     
  2. It increases the speed of the response to problems. Being automated, it is easier to find the source of the error and find the best solution. That is to say, to offer a satisfactory and rapid response to the problem.
     
  3. It improves interaction with customers. It is increasingly common for the public to use networks such as Twitter to send queries to a company, to criticise some of its processes or simply to ask for or give advice.

    Digital assets have become the way most used by customers, and having a website and networks where users can comment and ask is essential for any business that wants to survive the 2.0 era.

     
  4. It opens new market possibilities. In the digital world distances do not exist, and businesses that are in the digital world can reach more customers, enhance digital communication and reach potential market niches.
     
  5. Improves brand positioning. It is no secret that the brands we know the most are not necessarily the ones that advertise the most, but rather those we find the most on the Internet. Now, when we want to look for something we go to Google and only the digitalised companies with a clear online marketing strategy reach the first page of the well-known search engine.