Growth & Jobs | How to shape the future for SME
Published:Tuesday | August 6, 2024 | 12:05 AMKeisha Hill/Senior Gleaner Writer
SMALL AND medium-sized enterprises (SMEs) play significant roles in enabling, constraining and shaping the nature of growth, innovation and sustainability of our global, regional and local economies. They also tend to be very agile and able to reconfigure their business models and redeploy their resources very quickly.
According to Michael Lee-Chin, chairman of the NCB Financial Group, from an impact perspective and in a context of economic recovery and constant change, it is key to focus on this sector of the economy.
Although it is a commonly held belief that innovations from large corporates trickle down to SMEs, in some cases small and medium-sized companies are leading the way.
“Staying strategically small, investing in and trusting a core group of people, and keeping the organisation agile can enable SMEs to identify and quickly act on opportunities and remain competitive not just with their peers, but also with large corporates,” Lee-Chin said.
Lee-Chin, who was the keynote speaker at the second staging of the Re-Align Business and Investment Conference held at the AC Hotel on July 23, said a deeper understanding of organisational capabilities and orientations is needed for SMEs to successfully generate lasting financial growth, affect society and the environment positively, and develop high levels of resilience and agility.
Talent acquisition
The top challenges cited by SMEs include talent acquisition and retention, survival and expansion, funding and access to capital, non-supportive policy environment, the difficulty of maintaining a strong culture, and clear company purpose and value.
SMEs, he said, are also lagging in terms of societal impact. “Although there is a clear need to operate in line with sustainability goals, many SMEs have yet to include explicit strategies and performance measurements in this area,” Lee-Chin stated.
Some of these challenges, he outlined, can be overcome with the right innovation strategies and business models, and by appealing to a higher vision that comprises culture, core values, and purposeful work.
“With a rapidly changing geopolitical environment and a host of external factors at play, it is essential for SMEs to adopt resilient and innovative strategies to successfully navigate through this period of uncertainty,” Lee-Chin said.
For SMEs, he said this can be the year of transformation and evolution, using change as a lever for continued progress and development.
“It becomes critical to establish strategic goals and plans that serve as a guide to provide a clear sense of direction through the challenges and opportunities for SMEs. Such transformation will almost always depend on the strength of a company’s day-to-day business processes, internal and external connections, and how leaders use business data to drive decisions. When these factors are in place, it is easier to achieve the operational efficiency and agility needed to pivot into entirely new product lines and business models,” Lee-Chin explained.
It is time he said, to take inspiration from the companies that have used all the disruption and downtime to their advantage. Regardless of industry, size, or business model, resilient SMEs, he added, follow many of the same strategies.
The right tools
Lee-Chin also said SMEs need to be equipped with the right tools. Today, that means an assortment of digital and mobile equipment and software apps, either hosted in-house or in the cloud.
“Many of these solutions are also powered by AI to enhance speed and decision-making. Of course, the world of business has been moving to digital for a while. Cloud-based solutions, mobile communications, and online sales have become the norm. Everything, from how small businesses interact with customers, take and deliver orders, process payments, interact with their teams and organise their business, has been forced to go digital wherever possible. But keep in mind that digitisation is not a holy grail, and it is most valuable only when integrated with the right people and processes,” he said.
His advice for SMEs who want to be future-ready? “Don’t be afraid to take risks or to fail. If you do not fail, you do not succeed. It is amazing the enormous power your employees have; they can be instrumental to growing the business and develop new ideas if they are motivated to make the organisation grow. This will only work if they can be actively part of promoting change. They need to feel empowered. What we have built is based on a foundation of mutual trust and sharing risk, sharing knowledge, sharing successes and sharing failures,” Lee-Chin said.
What is crucial, he said, “is to create a culture that enables all of it.”