Full Potential of Digital Transformation for Small and Midsize Firms Worldwide Still Untapped
SAP NEWSBYTE
— Feb. 16, 2017
– Four out of five small and midsize businesses (SMBs) worldwide see tangible benefits as they embark
on a digital transformation, according to a
global study developed by IDC and commissioned by
SAP SE (NYSE: SAP). These benefits include increased sales,
decreased costs, ease of information access and improved customer
service and worker productivity. However, many have yet to unlock the
full potential of digital transformation: less than 7 percent
of SMBs have gone beyond integration to derive real-time insights that
drive optimization in processes and workflows to yield business results.
— Feb. 16, 2017
– Four out of five small and midsize businesses (SMBs) worldwide see tangible benefits as they embark
on a digital transformation, according to a
global study developed by IDC and commissioned by
SAP SE (NYSE: SAP). These benefits include increased sales,
decreased costs, ease of information access and improved customer
service and worker productivity. However, many have yet to unlock the
full potential of digital transformation: less than 7 percent
of SMBs have gone beyond integration to derive real-time insights that
drive optimization in processes and workflows to yield business results.
“Digital
transformation could quickly become a cost of doing business for small
and midsize businesses that want to maximize growth and profitability,”
said Barry Padgett, president of the SMB team, SAP. “This study shows
that smaller companies are being proactive and strategic in how they
invest in digital technologies. These investments, many of which have
minimal requirements in terms of capital investments
and IT staff, enable unprecedented opportunities for scale and
efficiency by providing access to capabilities that were once out of
reach for smaller companies.”
transformation could quickly become a cost of doing business for small
and midsize businesses that want to maximize growth and profitability,”
said Barry Padgett, president of the SMB team, SAP. “This study shows
that smaller companies are being proactive and strategic in how they
invest in digital technologies. These investments, many of which have
minimal requirements in terms of capital investments
and IT staff, enable unprecedented opportunities for scale and
efficiency by providing access to capabilities that were once out of
reach for smaller companies.”
The survey, which focused on the progress of digital transformation for SMBs across 13 countries around the world, found:
·
SMBs
are taking a “practical and tactical” approach to digital
transformation. Almost 44 percent are investing in technology to make an
immediate difference
in supporting current processes.
SMBs
are taking a “practical and tactical” approach to digital
transformation. Almost 44 percent are investing in technology to make an
immediate difference
in supporting current processes.
·
Midsize
firms with 500–999 employees are more prone to take a long-term view.
Close to half (46.5 percent) said their active participation in the
digital
economy will be essential to their company’s survival in the next three
to five years. Just over a third (38.2 percent) of small businesses
with fewer than 100 employees felt the same way.
Midsize
firms with 500–999 employees are more prone to take a long-term view.
Close to half (46.5 percent) said their active participation in the
digital
economy will be essential to their company’s survival in the next three
to five years. Just over a third (38.2 percent) of small businesses
with fewer than 100 employees felt the same way.
·
The
use of the cloud for implementation has made digital transformation
simpler for smaller companies, with two in five stating that the rollout
of their
first solution was either easier than expected, or took no extra
effort.
The
use of the cloud for implementation has made digital transformation
simpler for smaller companies, with two in five stating that the rollout
of their
first solution was either easier than expected, or took no extra
effort.
·
Use
of collaborative software, customer relationship management (CRM) and
e-commerce applications is widespread among SMBs. These application
often serve
as the first points of entry to digital transformation. One in three
smaller firms polled said that they preferred that these applications be
delivered through the cloud.
Use
of collaborative software, customer relationship management (CRM) and
e-commerce applications is widespread among SMBs. These application
often serve
as the first points of entry to digital transformation. One in three
smaller firms polled said that they preferred that these applications be
delivered through the cloud.
·
Almost
three-quarters (73 percent) of companies that have adopted digital
applications report that their expectations regarding technology
investments were
met or exceeded.
Almost
three-quarters (73 percent) of companies that have adopted digital
applications report that their expectations regarding technology
investments were
met or exceeded.
“SMBs
globally are increasingly recognizing the benefits of digital
transformation and continue to add advanced technology resources,”
said Ray Boggs, vice president, small and medium business research,
IDC. “But the challenge is in connecting different technology areas for
maximum impact. Firms that do that tend to grow faster and be more
successful in an increasingly competitive environment.”
globally are increasingly recognizing the benefits of digital
transformation and continue to add advanced technology resources,”
said Ray Boggs, vice president, small and medium business research,
IDC. “But the challenge is in connecting different technology areas for
maximum impact. Firms that do that tend to grow faster and be more
successful in an increasingly competitive environment.”
Though
hesitancies remain, more than one-third (34 percent) of respondents
have dedicated additional budget, staff and resources to digital
transformation, ensuring that SMBs will be able to flourish as the
digital economy grows.
hesitancies remain, more than one-third (34 percent) of respondents
have dedicated additional budget, staff and resources to digital
transformation, ensuring that SMBs will be able to flourish as the
digital economy grows.
“SMBs
in Asia Pacific and Japan are at an inflection point with the need to
digitally transform their businesses in order to stay competitive
and maintain, if not increase market share in the digital economy.
Going digital and implementing new enterprise-grade solutions can help
SMBs build and reinvent themselves for improved efficiency and long term
growth in today’s fact paced and changing business
landscape,” added Boggs.
in Asia Pacific and Japan are at an inflection point with the need to
digitally transform their businesses in order to stay competitive
and maintain, if not increase market share in the digital economy.
Going digital and implementing new enterprise-grade solutions can help
SMBs build and reinvent themselves for improved efficiency and long term
growth in today’s fact paced and changing business
landscape,” added Boggs.
An infographic of the survey can be downloaded
here.
here.
Methodology
The
IDC SMB Digital Transformation survey was conducted by IDC on behalf of
SAP, and consisted of feedback from 3,900 SMB* decision makers
across 13 countries spanning a variety of industries, including
manufacturing, retail, utilities, health, finance and public sector
(government). The survey is the second chapter of IDC research to be
released regarding digital transformation among small and
midsize businesses, and provides a closer look at cloud adoption,
priorities and tool selection. The IDC custom study, commissioned by
SAP, is titled “SMB Digital Transformation” (IDC document IB_2090_SAP).
IDC SMB Digital Transformation survey was conducted by IDC on behalf of
SAP, and consisted of feedback from 3,900 SMB* decision makers
across 13 countries spanning a variety of industries, including
manufacturing, retail, utilities, health, finance and public sector
(government). The survey is the second chapter of IDC research to be
released regarding digital transformation among small and
midsize businesses, and provides a closer look at cloud adoption,
priorities and tool selection. The IDC custom study, commissioned by
SAP, is titled “SMB Digital Transformation” (IDC document IB_2090_SAP).
*An SMB is defined as a company with up to 999 employees.
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