Small and medium-sized enterprises (SMEs) are the beating heart of Europe’s economy, employing around 90 million people, creating 85% of new jobs every year and adding value of more than €4 trillion. However, in a rapidly evolving business environment where the competition for customers is more intense than ever before, digital innovation is vital for these businesses to grow.
I am proud to have started my career at start-ups and so I know first-hand that when digitalization is done right, SMEs can reap enormous rewards – increasing their speed to market, making them more efficient, providing the tools required to protect their businesses from threats.
This requires access to the right technologies and support, which for many small businesses are often out of reach. Indeed, our research on SMEs has found that more than 1.2 million European businesses with less than 250 employees are yet to digitize fully, highlighting the scale of the challenge that this sector faces.
CEO of Vodafone Business.
Underserved SMEs
The reality is that for years SMEs have been underserved by the technology and telecoms industries. Instead of the right solutions that match the needs of their businesses, SMEs have been offered ‘off-the-shelf’ solutions that are more suited to consumers rather than small businesses. Research by Analysys Mason from last year found that 69% of SMEs in the US switched service provider because they felt product and service options were not tailored to their needs. This is symptomatic of a landscape where larger corporates are prioritized over smaller companies - and it is not contained to North America.
Combined with additional barriers such as funding shortages, and limited time and resources that were highlighted by our survey of 3,000 businesses across 11 European countries, SMEs are left facing a series of obstacles that prevent them from unlocking the benefits that effective technological transformation of their business will bring.
That is why as an industry, we need to step up to better support SMEs in their digitalization journeys.
We need to create solutions that don’t just work for SMEs, but which are made for SMEs – for example tailored security services that match the needs of their organization, or AI tools that empower SMEs to boost their productivity and efficiency in ways that are bespoke to their business.
And we need to consider how connectivity providers can use their bigger enterprise level relationships, for example with Big Tech, to provide SMEs with the right support, giving them access to upskilling and knowledge sharing services that will guide them on their journey.
Strengthening product capabilities
We are strengthening our established product capabilities at our business and paying particular attention to making these affordable and easily accessible to SMEs, enabling them to can compete with larger enterprises and access new markets. We will do this through continued investment in new technology, deepening bespoke partnerships with the best tech companies, growing the number of digital specialists in our company, and providing managed services that are fit for SME customers.
Cyber security is an area where industry needs to level the playing field. As threats multiply and become ever more sophisticated, the onus is on connectivity providers to ensure security platforms work for businesses of all sizes.
If we can tackle the barriers that SMEs face head-on, we will empower new and emerging businesses to effectively use digital tools, fueling growth and contributions to Europe’s economy for years to come. It matters from a supply chain perspective too. The success of companies is built on their relationship with a myriad of suppliers, and it is important that they are technologically coordinated and able to learn from each other.
The potential is immense, but so too are the stakes. We must act now to ensure no small business is left behind in the digital age.
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