South Africa’s small and medium enterprises (SMEs) are squaring up to some of the most difficult economic conditions in recent history. Even as they try to rebuild after the pandemic, they must contend with daily load shedding, high interest rates, low consumer confidence and a volatile exchange rate.
Yet these challenging times also offer an opportunity for the most agile and innovative to grow their businesses. We’re seeing many SME owners double down on investing in technology, after ICT solutions helped them to survive the COVID-19 lockdowns of 2020 and 2021.
The South African SME Tech Index 2023 research, conducted by World Wide Worx on behalf of Nashua, confirms that 45% of SMEs surveyed increased tech spending in the last 12 months and 38% plan to increase spending in the next 12 months.
Today’s digital and cloud-based technologies are levelling the playing fields for SMEs, making IT more affordable and enabling them to compete more effectively with larger companies. If anything, SMEs’ small size can be an advantage, enabling them to quickly deploy and operationalise new technologies.
Global research from Microsoft paints a picture of how SMEs worldwide are benefitting from their investment into technology. The survey shows that early adopters of technology are twice as likely to achieve high revenue growth than the rest, and four times more likely to be highly confident in their business.
Benefits of technology for SMEs include increasing operational efficiency, improving sales, marketing, and customer retention. South African SMEs in the survey were the most likely (48% of them) to believe that technology can help improve their competitive positioning.
Here are some ways that SMEs can strengthen their business through prudent use of technology:
Go paperless: Going paperless can help you save a lot of time and money. Digitising paper documents means that you no longer need to physically store them. You can instead store digitised documents on cloud platforms for easy access, collaboration and data backup.
Become more efficient: Technology can enable your business to automate business processes from capturing customer information and managing inventory to processing your payroll and submitting tax returns. Automated processes are faster, more accurate and more cost-efficient than doing the work manually. This lets you and your team focus on strategy, sales, customer service and other areas of competitive advantage, rather than on routine tasks and chores.
Sharpen the customer experience: Whether you operate in a business to business or business to consumer environment, your customer has higher expectations. They expect personalised care, seamless communication, and fast service. Customer relationship management (CRM) software enables you to personalise communications and offerings.
Go digital: Digital marketing strategies such as social media advertising, search engine optimisation (SEO), and content marketing let you engage with customers in new ways. Ecommerce, meanwhile, offers digital customers a convenient 24/7 way to buy from and interact with you. Online payments solutions can enhance the customer journey. And you can use AI-driven chatbots for round-the-clock customer support.
Embrace new ways of working: Following the pandemic, many SMEs adopted remote and hybrid working models. We’re seeing this trend continue as companies seek to offer more flexibility to their people, save money on office space, and digitalise their business processes beyond the office. This enables businesses of all sizes to do more with less resources and do it faster, all while delivering a better customer service and becoming more flexible.
Make better decisions: Digitalising your business processes gives you access to a wealth of data in systems such as your accounting, CRM, ecommerce, and inventory management systems. Advanced analytics and reporting tools enable you to tap into this data to get valuable insights into customer behaviour, market trends, and business performance, empowering you to make informed decisions and drive strategic initiatives.
Improve resilience: SMEs face a range of risks today, from frequent power outages to crime and data breaches. Cloud-based solutions, mobile connectivity and backup power solutions are all key to ensuring business continuity. This is a major area of investment for South African SMEs.
By Barry Venter, CEO of Total Workspace Solutions provider, Nashua