The article is published in The Business Times on 27 October 2015.
Adoption of social media and cloud computing are among ways that can help SMEs become a disruptive force.
FROM our travel and commute options to our vacations to the way we seek new relationships, technology has given us a breadth of choices and made access to them easier. All around us, we can see industries which have been or are in the process of being disrupted.
Perhaps what is less obvious is not how being "online" has changed retail, but rather the conceptual change behind retail which technology has made possible. Digital technology is therefore the great competitive leveller. Just as the rise of social media has changed how we interact with people, rapid advances in digital technologies are also bringing upon us changes in how we work, and gradually change our global business environment.
Access to technology, great ideas and an increasing spirit of entrepreneurship have allowed smaller and more nimble startups to help solve business problems. Therefore, as we increasingly operate in a digital economy, how companies operate in the future and the business models they deploy will also need to be more innovative and adaptive to change.
Too small for digital economy?
Small and medium enterprises (SMEs) have the huge potential to shape local economies around the globe as we see their ideas come to life today. Lifestyle choices are being radically altered with a multiplicity of new products that add convenience and fix problems in all areas of business.
SMEs grapple with a similar suite of issues that multinationals also manage. These include overpowering globalisation and newly empowered customers in emerging markets and fast-changing technologies.
Addressing these complexities requires a shift in the power dynamics of an organisation. It also requires companies to be aware of challenges with technology including enhanced product and service development, supply chain optimisation and delivering better customer service.
Although this evolution cannot happen overnight, here are some steps that can help your company achieve this state to become a disruptive force.
Apart from issues with financing, SMEs often have to battle insufficient skills and technology, high transaction costs, unclear property rights and inadequate market access. You may also find it difficult to understand what support the Singapore government can offer your business.
Innovate to pause disruption
SMEs by and large need to master mobile, analytics and cloud computing to gain a competitive edge in an overcrowded industry and successfully deliver what customers are seeking.
Through adopting technology and making it fit for purpose, SMEs can boost innovation, strengthen customer interactions, improve your business' agility and competitiveness, and develop a reliable and unique relationship with your markets.
Being able to leverage technology and build innovation successfully will also help SMEs bridge the gap between venture creation and knowledge creation. This will also help you accelerate the conversion of ideas to market-ready enterprises.
Greenpac is a homegrown green packaging company that has carved a niche for itself in offering customised eco-friendly packaging. The Enterprise 50 Award winner keeps up with the growing demands of its customers through a fully integrated accounting and management system.
According to Spring Singapore, more than 600 food and beverage outlets have implemented some form of digital service solution to boost service excellence and better serve their customers.
Clearly, technology adoption has gained significant traction in Singapore. Combining the merits of both innovation and technology will allow SMEs to sharpen growth, stimulate profits, execute consistent and smart ideas and build capable and mobilised firms.
The article is contributed by Mr Chiu Wu Hong, Head of Enterprise at KPMG in Singapore. The views expressed are his own.