The COVID-19 crisis also stressed the need to accelerate SME digitalization, to weather the storm in the short term, as well as for increasing resilience in the longer term and “build back better”. Social distancing imposed during confinement, workers kept home as schools closed doors, and the closure of many businesses requiring physical contact, often in sectors where SMEs are the majority (e.g. retail trade, recreation, hotels and food services etc.), have all highlighted the limits of non-digital business models. This also underlined the widening gaps in opportunities between those businesses that have a digital profile, or could rapidly shift to digital modes, and the digital laggards.
To help small and medium-sized enterprises [SMEs] integrate into global markets, through reductions in costs associated with transport and border operations and significantly enhances the scope to trade services, The number one telecommunications network in Ghana, MTN Ghana, that prides in numerous awards is seeking to hold a business empowerment and sensitization program on Thursday July 8 that aims at addressing Challenges faced by the [SME’s], who are biggest contributors of Economy in the country.
In marking its 25th birthday, The giant telecommunication network has invited keynote speakers from business and corporate world such as Eric Osiakwan the managing partner Chanzo Capital, Mariam Kaleem A-Buahen, the Group head, Digital Marketing Letshego Holdings Limited and Dr. Daniel Mckorley CEO and Chairman Mcdan Group who among other things will share their experiences, right information, platforms, solutions and activities to support accelerate SME’S growth.
in the occasion of the Covid-19 pandemic, Safety measures and protocols have been adhered to and there will be restricted in-person attendance to the event, however customers and stakeholders will be able to follow this prime discussion on the MTN Ghana Facebook page, as well as LinkedIn @mtnghana
Digitization facilitates access to resources, including finance which involves {peer-to-peer lending} training, and recruitment channels, including government services, which are increasingly being made available on-line. It also supports innovation, and greater access to innovation, assets, as well as the potential for firms to generate data and analyze their own operations in new ways, to drive improved performance.
Despite the digitization uptake and adoption poor, t there are so much benefits and opportunities in technology.
many SMEs continue to lag in adoption, and for smaller SMEs, with 10- 49 employees, digital adoption gaps, compared to larger firms, have grown over the last decade. Indeed in many countries not just in Africa but whole world.
ENTRY POINT FOR SMALL FIRMS
The biggest challenge is the first step for many firms. Once an initial transition is made to digital technologies, there are strong complementarities in technologies that can drive further adoption. To make this step, and as they identify and adopt additional digital technologies, SMEs tend to leverage on external systems, support and advice. This is partly to compensate for weak internal capacities but it is also on cost-grounds.
The gap between SMEs and larger firms is therefore more pronounced in the adoption of more sophisticated technologies {data analytics} or where mass matters for implementation.
The entry point for the digital transition for most SMEs is in general administration or marketing functions, where the digital gaps between SMEs and larger firms in online interactions with the government, electronic invoicing, use of social media, and e-commerce, are smaller.
NEED AND OPPORTUNITIES IN DIGITALISATION OF SMEs
COVID-19 THE GAME CHANGER
The Covid-19 outbreak and the rapid evolution in markets and business conditions provide both opportunities and incentives for SMEs to go digital. The rapid shift to digital tools across entire supply chains or ecosystems, the move to data-driven decision making models, the change in customer behavior towards an “online first” search for goods and services might all have lasting effects on SMEs across sectors and geographies.
However, most small businesses are ill prepared for a radical transformation on such a short notice. Gaps in digital capacity and infrastructure that existed prior to the outbreak remain, with rising threats on SME cybersecurity and data integrity. The increasing indebtedness of SMEs may pose challenges to the longer-term investments required to innovate, upgrade digital capacity, acquire new skills or reach out to new markets. Moreover, many entrepreneurs and SME employees are facing an extremely trying period, with serious consequences for their mental health and psychological well-being.
Early evidence from business surveys worldwide point to up to 70% of SMEs having intensified their use of digital technologies due to COVID-19 with many of these changes poised to last given the investments made and business benefits of the new models.
For example, in the United Kingdom 75% of the firms surveyed have moved to remote working over the period and around a third have invested in new digital capabilities and 72% of online small business owners interviewed in Canada believe ecommerce is now necessary in order to have a successful business.
However, many businesses have not had the time or the advice needed to plan this transition well to select the right digital systems, to upgrade digital skills, develop the right protections and security, and fully customize and understand the potential of these new tools.
In addition to the need to access the right advice and inspiration, The MTN Ghana, SME’s empowerment program session among other things is expected to bring all this matters in a more understandable business language in assessing other structural barriers that digital adoption remains:
- An internal skills gap that prevents managers and workers to identify the digital solutions they need, and to adapt business models and processes.
- A financing gap, as SMEs face difficulties in accessing finance for intangible digital investments that cannot be easily used as collateral to secure a loan.
- An infrastructure gap. Access to high-speed broadband is a prerequisite for the digital transformation of SMEs. Penetration rates of high-speed broadband have been increasing in all OECD countries since 2011, but the leading countries and firms have been pulling away from the rest (and gaps between firms in lagging countries have widened significantly.
These gaps have left some firms and places with limited scope to adapt their business models and maintain operations during extended periods of social distancing, exacerbating existing inequalities.
HOW CAN GOVERNMENT BOOST SME’s TRANSFORMATION?
- Providing SMEs with technology support and assistance, through targeted financial support (consultancy vouchers, grants), technology extension programmes (diagnosis, self-assessment tools, e-business solutions, guidance and package of learning material) or a mix of both;
- Encouraging SME training and upskilling, by reducing training costs (e.g. tax incentives, subsidies) and promoting workplace training (e.g. via employers networks and associations, or intermediary “brokers”, apprenticeships programmes) or by pooling training investments, and strengthening management skills in SMEs
- Building a data culture in SMEs, by increasing awareness and capacity to manage and protect their data (e.g. though information dissemination, financial support or technical assistance).
- Raising the digital security profile of SMEs, through awareness campaigns, or providing them with guidance on useful digital security measures, toolkit, auditing, assurance framework, protocols and certification schemes, and training opportunities.
- Leveraging fintech and alternative sources of finance for SMEs, by promoting the use of new technologies (such as blockchain and AI) to lower transaction costs on finance markets, encouraging the deployment of financing and matching marketplaces, as well as the use of mobile banking, or alternative data for credit risk assessment.
- Encouraging business innovation and the supply of new digital solutions, through a range of research and innovation policies
- Focus on experiences and views of SMEs accessing government support at national or local level identifying the challenges, pre-conditions and effects of such programmes
CREATING THE RIGHT BUSINESS ENVIRONMENT FOR SME TRANSFORMATION
- Setting a supportive regulatory framework, by: reinforcing efforts to harmonize legislations on trade secrecy and intellectual property rights protection across jurisdictions, enforcing data protection regulations, developing digital security legislations and setting standards for the industry, addressing regulatory uncertainties around distributed ledger technologies, and by ensuring the well-functioning of knowledge markets where SMEs can access digital solutions.
- Promoting e-government and e-services for SMEs, through one-stop shops and digital portals (e.g. for information provision, or assistance, certification or simulation online, adoption of new digital technologies in public services and through open government data.
3. Deploying high-quality digital infrastructure, through infrastructural development plans and roadmap( high-speed broadband and connectivity in remote areas), or other platforms (computer emergency responses teams) or public-sector-backed blockchain service infrastructure with interoperability with private sector platforms.
PROMOTING A WHOLE-OF-GOVERNMENT APPROACH
- Developing long-term strategic frameworks, by setting high-level objectives and principles, designing national strategies and action plans, and coordinating investments and action across the board.
In a dynamic and integrated world, the availability of up-to-date information on SME competitiveness and its drivers is crucial for sector associations and government agencies to foster SME integration in global
markets and inclusive growth.
