Empowering SME's

Importance of the SME Sector

With close to 50 million units, the Small Medium Businesses sector (defined as companies in the 1 to 999 employee size) in India is one of the largest in the world in terms of number of units. More than 90 percent of these SMEs are very small enterprises with less than 10 employees.

The SMB sector plays a very crucial role in the economy in terms of contribution to the GDP as well and generating employment opportunities.

It is therefore important to improve the overall health of this sector and ensure sustainable growth.

Problems it Faces

SME’s today have to contend with the forces of globalization, rapid technological changes, ever increasing competition, and rapid changes in consumer need and behavior. These challenges have only got compounded by the overall slowdown in the economy and subdued consumer sentiments. SME’s today not only compete with similar sized organizations, but also larger corporates who in current difficult economic scenarios are expanding their product footprint to compete with SMEs.

Being informed is one of the methods to be competitive. And when it comes to being informed, continuous flow of information is required.

DATA EXPLOSION – Advantages

Data explosion among SMEs has been caused by IT applications and email. The deployment of IT applications such as ERP and CRM has ensured that organizations generate excessive digital information. This information can be used to draw deep and impactful insights.

Along with the internal data there is a lot of information available through external sources like the social media. The main advantage this type of data offers is real time information, which can greatly reduce the time lag between the accumulation and analysis of data, and subsequent responses. Real-time customer expressions of brand experiences online have the power to influence business performance more than before. Social media interventions effectively manage escalations and customer dissatisfaction thus bringing you closer to your customer’s opinion.

Given that context, SMEs need to enhance their competitiveness through use of technology and data driven decision making process, while keeping the nimbleness in business intact.

Business Intelligence enabling right decision making becomes highly important, ensuring

ü  Better ROI

ü  Faster Break Even Points

ü  Channelizing Expansion

ü  Risk Mitigation

ü  Sustainable Growth through Meaningful and actionable insights

ü  Enhancing Marketing and Branding Efforts

DATA EXPLOSION - Pitfalls

Investment Needed - Even when they adopt IT, the focus for SMEs is initially on basic computing hardware, networking and core business applications. Business intelligence adoption is limited to those SMEs who are at the top end of IT maturity and adoption. Most of these are the larger SMEs (500 to 999 employee size). SMEs should not get drawn into doing things the “Big Bang” approach with respect to implementing BI and Data Analytics, as it will delay the impact of these initiatives for business results. Incremental and steady approach will always have better ROI and faster break even points for the SMEs as it will demonstrate the benefits quite quickly and give flexibility to make adjustments if needed.

Requirements vary from business to business – SME’s have varied requirements ranging from managing customers  to Operations, HR, Finance and other business areas. Their requirements also vary because with respect to domain needs. Today SME’s have a wide range of options when the start thinking of business intelligence solutions. There is an ever growing network of channel partners, that cater to SME’s, who are able to bring in a range of solution and are able to customize them for SMEs.

Acceptance and applicability - For years, before these sophisticated techniques of analytics were developed, executives have relied on expertise of their experience and on ‘gut’ feeling to make decisions. Hence the acceptance of Analytics and Big Data Analytics among the business users is key issue which need to be tackled before investing in Big Data.

Bypassing Basics - SMEs should watch out for is not to get carried away with things like “Big Data” at this stage (things which are getting lot of “attention”) till they become mature with respect to BI and Data Analytics. However as part of all initiatives related to BI and Data Analytics, they should keep future applications like ‘Big Data” in perspective while designing the BI and Data Analytics infrastructure.

Channelizing for profit maximization

Analytics as an area of expertise has evolved beyond creating sophisticated tools to sift data. It is more about how to deliver value by increasing revenue, profitability or the customer base

Detailed Analysis+Targeted Marketing = Higher Profits

SME's should focus around 

• Value creation and insights from diverse data sets; 
• Specialized intelligent solutions keeping in pace with latest socio-economic trends; 
• Optimize business processes through smart evaluation of programs