Small and medium enterprises (SMEs) form the backbone of economies around the world, and are especially important in driving growth and providing employment. Globally, there are approximately 400 million SMEs, forming 95% of firms and providing employment to 60-70% of the world’s labour force. This is no different in Singapore, where they make up 99% of all domestic companies and contribute to 50% of Singapore’s national GDP.
However, by nature, SMEs lack the resources and corporate infrastructure a large enterprise might have. Indeed, many struggle simply to make ends meet, let alone expand and grow.
How can SMEs achieve and sustain growth against this backdrop?
Pioneer Consulting APAC has formulated four key areas SMEs can take note of when developing plans for growth and expansion:
1. Win through Specialisation
Many SMEs are faced with the temptation to expand laterally – seeing what sticks to the wall. Given their often-scarce resources, resource optimization is key to a successful business strategy. Therefore, SMEs should channel resources to providing a niche service of top quality and seeking to be the best-in-class of that niche. Being a master of one beats being a jack of all trades in this case.
Key Questions: What does our organisation do well? What do we want to be known for? Is there room for us to do even better in this area?
Potential projects to undertake: Business strategy development, strategy validation, innovation / ideation, internal benchmarking, process optimization, cost optimization
2. Differentiate from the Competition
Know thy foe. While it is important for SMEs to ensure that the business is running smoothly internally, don’t ignore what the competition is doing. SMEs stand to gain in two ways:
a. Inspiration; learn best practices from others in the market
b. Find gaps; identify the underserved needs in the market that could be captured
Key Questions: What areas do our competitors do well in? What other areas do they struggle in?
Potential projects to undertake: Landscape analysis, competitor analysis / benchmarking, market potential analysis, market research
3. Strive to Digitalise
IT is often seen as a cost centre, but this perception is changing quickly. While it can be daunting to implement new tech that seems difficult and costly to operate, these systems have the potential to generate significant cost savings and productivity improvements. Some common areas that have employed digital solutions include: HR, CRM, Accounting, etc. – and this has been recognised by the Government in the form of grant support.
Digitalisation also creates opportunities amidst crisis: during the pandemic, support for the shift towards eCommerce allowed many businesses to survive despite physical constraints.
Key Questions: Which processes can we make more efficient with the help of technology? What emerging technologies can we capitalise on?
Potential projects to undertake: Digital transformation, capability development, internal analysis, brand audit
4. Focus on CX – the Customer eXperience
An endorsement from a customer will prove to be more effective than any other marketing campaign. Focus on building good customer experience and brand loyalty, and word-of-mouth will reap dividends
Some guiding principles for good CX:
a. Be proactive when responding to reviews
b. Provide effective & responsive customer support
c. Create an efficient and easy purchasing process for customers
d. Build a personal relationship with your customer; make them feel valued!
e. Listen to your customers – take criticism with grace
Key Questions: How can we improve our current CX and build brand loyalty?
Potential projects to undertake: Strategy planning, ideation, competitor benchmarking, brand audit, marketing & branding strategy development
Pioneer Consulting Asia-Pacific (PCA) is an international management consultancy specializing in telecoms, media, gaming, ePayments, digital banking, emerging digital ecosystems and other digital developments, working with both enterprises and SMEs. PCA also undertakes proprietary primary market research, and provides executive training and coaching to its clients.
PCA has consultants with certifications formally recognised by Enterprise SG, which allows us to support SMEs by subsidising up to 70% of consultancy project costs for SMEs through the Enterprise Development Grant.
For more information or to start a discussion with us, please feel free to contact us.