Partner Article

SMEs are adopting a global mindset

There are a number of misconceptions about SMEs; they are unable to compete with the ‘big boys’, they’re technophobic and they can’t punch above their weight in overseas trade. However, according to recent research by Oxford Economics in conjunction with SAP, these are simply myths. Thesurvey of 2,100 executives from SMEs in 21 countries, found that SMEs around the world, and across all industries, are making major changes to their business models and go-to-market strategies, as well as investing in technology to improve operations and become more efficient.

The fact that more and more SMEs are venturing outside of their home market to accelerate growth is great news, and reflective of the increased investment into technology and innovation to enable them to effectively compete.

John Bryceland, Head of SME Sales at SAP UKI, believes there are a few key points which highlight this changing mindset and the need to increase competitiveness globally.

SMEs are looking overseas for growth

Only one in five SMEs surveyed in EMEA said that they do no business outside of their home country, and this is expected to drop to just 15% in three years’ time. It’s promising to see that already, a significant number of SMEs are thinking beyond their domestic markets in order to grow. Key to this trend is the fact that both the percentage of revenue generated outside their home country and the number of countries in which SMEs do business is expected to significantly increase over the next three years. In addition, 60% of SMEs in EMEA are increasingly focused on penetrating new geographic markets.

SMEs are building networks across the globe

Over half of respondents said they are forming partnerships with suppliers and other vendors in countries outside their domestic markets, and a similar number are doing so via online business networks. Whilst this is also viewed as a key challenge for nearly 40% of SMEs, as they reshape their companies for the global marketplace, cloud computing and social media are providing platforms to facilitate this growth.

Investment in technology is a top priority for SMEs

Investment into new technologies such as business management software, data analytics, mobile, social media and cloud computing is a top strategic priority for SMEs broadening their reach into foreign markets. In fact, almost two thirds strongly believe that technology helps them achieve sustainable growth, with a further third of EMEA firms claiming to be early adopters. This is because SMEs are increasingly recognising that they can gain a big advantage by adapting their operations and their strategy to compete in a global marketplace.

These findings are very encouraging for the road ahead, and point towards the fact that investment into expansion overseas, through both trade and partnerships, as well as adoption of new technologies, will be the hallmarks of successful growth for SMEs.

This was posted in Bdaily's Members' News section by SAP .