With covid-induced impositions, small businesses were grappling with business continuity that forced them to quickly seek refuge in technology to keep up with the remote working culture. The covid induced situation has accelerated the technology adoption in businesses across sectors like communication, marketing, team collaboration, payments, hiring, procurement of goods and services and storage, registration of new business verticals by 7 years. This quick pivot to technology is aiding small businesses to reap the benefits of cost reduction and increased productivity levels.
The premise stated above is strengthened by a survey on small businesses conducted by Dun & Bradstreet, where 54 percent have reported that technology adoption has helped them in reducing costs and 51 percent said that it has helped in enhancing competitiveness. When it comes to technology adoption, small businesses are showcasing agility and taking faster decisions for adoption, unlike larger corporations, where they have to wait for the top brass’ decision.
According to a study from KPMG and Google, digitally-enabled small businesses can grow profits up to two times faster than offline businesses. Digitally-backed small businesses can employ more people, create a seamless supply chain, expand their customer base, foray into international markets and reduce redundancies in workflows.
According to a study from KPMG and Google, digitally-enabled small businesses can grow profits up to two times faster than offline businesses.
Sectors where technology adoption has benefitted small businesses
Technology taking offline market online
With e-commerce behaviour becoming the new norm of shopping, several small businesses are embracing e-commerce channels for creating their D2C stores to increase market reach and tapping the unexplored markets. Small businesses are adopting digital marketing tools such as search engine optimisation (SEO), search engine marketing (SEM), content marketing, e-mail marketing, Pay-Per-Click, and Google Analytics to increase visibility, acquire more customers and generate revenues.
Technology for creating seamless workflows
Adoption of technology has been beneficial to small and medium scale manufacturing companies in supply management, logistics, and procurement or manufacturing operations and human resources by eliminating redundancies and creating seamless workflows.
For bringing easing operations MSMEs are adopting customer relationship management (CRM) software to help them maintain a comprehensive digital record of customer engagement, design and customise offerings and manage orders, and parallelly enable to keep track of sales. Similarly, the human resource management (HRM) systems are simplifying the hiring process involving recruitment, staffing, training, compensation, performance appraisal, retention strategies, etc.
Adoption of cloud technologies
MSMEs with tight budgets are adopting cloud tools rather than going for the conventional IT infrastructure as it eliminates the need for a business to spend on hardware, slash maintenance costs and also free from the hassle of software patch-ups and updating.
Since it is a cloud, an on-demand service, it allows flexibility in operations enabling quick scaling up or modification ensuring data backup without hampering the business continuity while operating remotely.
Fintech technologies to avail financial assistance
With increased stress on liquidity and working capital, small businesses are seeking fintech services to secure microloans by deriving credit scores from borrower’s digital footprints by leveraging big data analytics, artificial intelligence (AI), and machine learning (ML) algorithms. Such technologies by collecting and analysing data will help small businesses avail more loans, improve underwriting processes, and prevent MSME loan proposal rejections to a great extent.
What lies ahead of small businesses in technology adoption?
Technology adoption that earlier seemed a privilege for small businesses has now emerged to be a necessity in times of pandemic. Small businesses are gradually coming out of the perception that technology adoption is limited to larger corporations or organisations.
With improvements in customer assistance and enterprise tech companies offering affordable tech solutions, small businesses are now letting go of the fear of implementing technologies to achieve self-reliance with minimal intervention. Enterprise tech giant IBM Public Cloud has been providing tech offerings to MSMEs, that include cloud-enabled AI, data, security, integration, video, etc. which help businesses to keep their operations running in the remote environment.
To aid MSMEs to adopt technology, the government has introduced special schemes where a small business can avail collateral-free automatic loans worth Rs 3 lakh crore.