3 TIPS TO HELP SMES GEAR UP FOR RECOVERY POST COVID-19
Small and medium-sized enterprises (SMEs) play a significant role within Singapore’s economy and society. Making up 99% of the overall number of enterprises within the island state, SMEs account for nearly three-fourths of employment and these small business owners are what keep the Singaporean economy going.
The COVID-19 pandemic and global economic downturn have significantly altered the situation for them. With people staying home and limiting their time outside, business owners that depended on foot traffic saw a dramatic drop in customers. Recognizing the dire situation facing SMEs, the Singapore government has announced various support measures across four different Budgets alongside other support programs.
For SMEs, the pandemic brought into key focus a pain point that had been previously identified, albeit with limited progress – the need to digitalize and future-proof their businesses.
THE NEED TO CHANGE IN THE ‘NEW NORMAL’
In our current ‘New Normal’, a company’s digital presence has changed from a good-to-have to a must have. Many consumers, if not all, are going online for their shopping, food and deliveries. SMEs must realign their business model to accommodate new habits in a digital-first world. Adopting e-commerce models, for example, will be key to engaging consumers, whose first point of sales is now online. Going online also offers traditional brick-and-mortar businesses an opportunity to reach new consumers and expand their customer pool, such as markets selling fresh produce online.
In addition, SMEs looking to succeed in today’s age of Industry 4.0 need to look at deploying digital technologies like data analytics and the Internet of Things (IoT).
WHAT TO KEEP IN MIND ON THE JOURNEY TO DIGITALIZATION
SMEs must consider a few key issues when choosing a digital transformation partner.
1. Financial Commitment
Keep an eye on your financial commitment.
SMEs may not have ready access to deep financial resources and extensive partners compared with MNCs. They’re also not borrowing much from banks to bolster their balance sheets, as seen in a decline in bank lending to SMEs in the Monetary Authority of Singapore’s “Financial Stability Review 2019”.
Business owners should thus try to avoid being locked-in to long-term contracts with service partners, as this reduces the flexibility needed to swiftly adapt to changing market conditions.
Consider partners with shorter, flexible contract lengths, or those with as-a-service business models where you pay for only the services used. Avoid putting up too much capital upfront; on-demand services enable you to convert fixed capital expenses into variable operating expenses that more accurately reflect your needs – and save you money in the longer run.
In addition, make use of the support afforded by the government, such as the Enterprise Grow Package, which is precisely designed to help businesses adopt pre-approved digital technologies.
Don’t plan for a solution that simply fits you now. Look for a longer-term, sustainable solution that can grow with you.
To ensure every part of your business stays connected, your network must be able to handle fluctuations in demands for bandwidth, speed, and connectivity. Poor performance can result in the loss of business and customer trust.
Your network must be agile and flexible enough to scale up during peak traffic periods and ensure a smooth digital experience for your customers, and scale down during lulls to minimize total costs of operations while still ensuring optimum performance.
Inevitably, the more you digitalize, the more entry points exist for attacks.
Every new connection to the internet and your hardware provides malicious actors with an avenue for attack. COVID-19 has further exacerbated the situation with cyber attackers exploiting the fears and confusion sown by the pandemic.
One common way of attack is to use Distributed Denial-of-Service (DDoS), which can quickly overwhelm a server with a multitude of requests. DDoS can cripple businesses, especially as they become dependent on online services.
SMEs often lack the infrastructure to adequately respond to these attacks, falsely believing that they would never be targeted. However, a company’s size is no longer an indicator of risk. Therefore, SME owners should consider including an automatic DDoS detection service from their internet provider.
By keeping these three issues in mind, SME owners can look towards successful digital transformation to help them through the pandemic, and future-proofing their business for the new digital future.
This article is contributed by Susan Loh, VP of Marketing and Business Development at SPTel. SPTel is a business class digital services provider in Singapore and a JV of ST Engineering and SP Group. They are the nation’s alternate fibre network with an end-to-end software defined network for flexible, scalable and secure connectivity solutions.
Find out more about SPTel here.
To see how they can support SME digitalisation plans, click here.