Study shows Apac SMES adapt to remote work setup amid Covid
SMALL and medium enterprises (SMES) in Asia-pacific (Apac) are adaptive of a remote working environment by taking immediate actions to implement the “work from home” arrangements for employees amid the Covid-19 pandemic, revealed a study.
Based on SAP’S study dubbed “Digital Resilient, and Experiencedriven: How Small and Midsize Organizations Can Prepare for the New Economy,” 77 percent of the respondents had adjusted to remote work arrangements for employees in response to the crisis, as compared to respondents in Europe and the Americas at 75 percent and 71 percent, respectively.
Sixty-one percent of Apac SMES said they created remote work setups for employees during this period, while 69 percent invested in information technology and collaboration solutions to support remote access and/or online learning.
Interestingly, 10 percent of them reported that the pandemic has no effect on their ability to accommodate remote work and maintain employee productivity.
Apart from ensuring their continuous operations during this period, many small and midsize businesses in the region are also actively exploring new channels to get their products and services to customers (66 percent, vs. 64 percent in the Americas and 59 percent in Europe) and developing new products and service offerings (46 percent, vs. 40 percent in the Americas and 49 percent in Europe).
“SMES across the region—like their counterparts around the world—have certain advantages over larger competitors in terms of agility and closeness to the customer,” said Edward Cone, editorial director of thought leadership and technology practice lead at Oxford Economics. “Yet even before the pandemic, SMES in Apac also faced meaningful challenges in keeping up the pace of digital transformation.”
The survey also revealed that Covid-19 has significantly impacted Apac SMES’ ability to compete with bigger firms in the same industry, with 45 percent of them reporting that the pandemic has had a significant effect on their operations and strategies in this area.
The crisis has also affected the ability to operate at full capacity (45 percent), the ability of the supply chains to keep up with demands (40 percent), and the ability to keep existing customers (40 percent).
Some participants said that they had to fully restructure business strategy and operations in these areas to reduce the impact of the pandemic. Before the outbreak, SMES in the region were positive about their long-term prospects. Many expect that in the next three years, their market share (62 percent), budget/ revenue (76 percent), number of full-time employees (59 percent), and profitability (78 percent) will increase somewhat or substantially.
Looking forward to that, they are prioritizing improving the customer experience (40 percent), growth (38 percent) and attracting new customers (28 percent).
They believe that the key to providing high-quality customer experience lies in high-quality products and/or services (70 percent), fast and convenient delivery (64 percent) and competitive pricing (62 percent), with the customer-service business function bearing the most responsibility for delivering those experiences (cited by 70 percent of respondents). Upgrading analytics on customer data is viewed as a go-to strategy to improve customer experience: 28 percent already have done this across the organization, and 52 percent have started to.
Many SMES in the region have made moderate progress toward digital transformation (39 percent), and 21 percent have made substantial progress or completely transformed; within three years, 19 percent expect to have completely transformed.
Technology-wise, they tap HR/ talent management software (66 percent), governance and cybersecurity software (63 percent) and finance and risk management software (59 percent) in some applications/projects or already used them at scale.
Mobile devices and mobile business process enablement, and business management solutions (ERP software) top the pilot implementation, and Apac SMES consider emerging technologies, AI/ML and Internet of Things as their main investment priority.
At present, they view the upskilling/reskilling of the current workforce (30 percent), lack of coordination between different departments (29 percent), and inability to gain insights from data (28 percent) as key internal challenges.
External challenges for them, such as changing customer wants and needs (40 percent), competition from larger organizations (39 percent), and adapting to a rapidly changing marketplace (27 percent) emerge as hindrances to their business success.
“Today’s new normal requires businesses to pivot and adapt with speed. SMES in the region seem to understand that the sense of urgency to digitally transform their businesses will give them an advantage through the pandemic and beyond,” said Claus Andresen, senior vice president and head of general business (SME) and emerging markets growth, Asia Pacific & Japan.
“With the adoption of an intelligent enterprise strategy, SMES can establish a digital core that will power the entire organization, embedding data-driven insights and decision-making processes across the business. This is crucial in enabling business agility, further strengthening the ability of SMES to adapt to dynamic market conditions.
“I am confident SMES in the region will be able to emerge stronger, having forged closer bonds with customers and employees, while developing innovative services and products that will put them on a strong growth trajectory as the world economy recovers,” he stressed.
Conducted in collaboration with Oxford Economics from February 27 to April 30, the study engaged 2,000 respondents, 832 of them were from the following Apac markets: Australia, China, India, Japan, New Zealand, the Philippines, Singapore, and South Korea.
A section detailing answers from 240 respondents on the impact of the Covid-19 pandemic was also added to the survey mid-fieldwork.