Covid-19 had turned the world economy upside down, and startups & SMEs are the most affected of the lot.
Mid-sized companies are diverse in terms of size, products and services offered, turnover and technology adoption. The spectrum is broad. On one end are high-growth enterprises in developed sectors, such as textiles and garments, auto components, health care, education and telecom equipment, while at the other end we find sub-contractors and other slow-growing, informal players in the retail and un-organised sector such as local vendors and cottage industrial units.
In the advent of the ‘Fourth Industrial Revolution’, i.e. Technological Revolution, the latter have moved up the value chain from manufacturing of simple goods to sophisticated products, and also entering the service sector. However, all is not rosy, as they are now faced with global competition in a rapidly growing market, and in order to remain profitable in this competitive environment, it is imperative for them to be quick to adopt newer technology and always keep and eye on the future.
It has been observed that mid-sized organisations often lack the abilities of larger enterprises to deal with economic and functional issues. The challenges are diverse in nature and hence a substantial amount of time and energy of the founder/promoter tends to be spent on overcoming them. This trend needs to be controlled and reversed early on as it limits business growth and renders the business unsustainable in the long run.
Some of the major challenges faced by SMEs in India include:
1. Absence of adequate, timely finance and high cost of borrowing
2. Inadequate marketing and branding strategy;
3. Delayed payments;
4. Non-availability of appropriate technology and awareness;
5. Non-availability of skilled manpower; and
Whilst there are solutions available for addressing the above hurdles, what is relevant today is that technology plays a very important role in resolving most of them. We are living and are moving towards a highly advanced and high paced economy that will obliviate all those who are unable to keep pace.
Technology driven solutions such as business analytics tools can play a pivotal role in assisting small business with better financial management and maintaining customer relationships. Detailed and precise demography analytics can also solve the problem of lack of market awareness and delayed information collection & processing due to limited regional target markets.
On the payments front, financial analytics helps to monitor the collections process and identify customer behaviour in terms of what they buy and how they pay thereby enabling SMEs to identify overdue balances and other receivables bottlenecks. It also enables these companies to improve their recovery rate
Further, deciphering business analytics tools like Excel, Solver can be extremely helpful for business owners and leadership teams, as it helps them build dashboards, review mechanisms and build forecasting models which in-turn predict outcomes. These existing tools are cost-effective solutions for SMEs to adapt to technology and analytics frameworks.
A sustainable ecosystem is the need of the hour and the starting point for this ecosystem, lies in adopting data-driven business models to help them effectively tackle problems arising at multiple levels.
About Author:
Venkatesh is a subject matter expert in data analytics, strategic marketing, pricing, revenue planning, data management & process management.
He is also an enterprising leader offering 20 years of experience in business & strategic marketing. Read more