The Impact of Digital Transformation on Small to Medium-sized Enterprises
Digital transformation (DT) is the process of redefining the entire business strategy by adopting the latest and emerging digital technology in driving the business through strategic plans and organizational change to augment the revenue and provide substantial value.
Digital transformation has a growing impact on Small to Medium-sized Enterprises (SME) business and IT ecosystems and offers new and prolific opportunities to participate in the global economy. Enterprise Applications Providers, Technology and Infrastructure vendors have realized and capitalized on the power of innovative technologies like Cloud, Big Data, Mobile, Social, Sensors, etc., considering next-gen solutions are being developed with the nexus of these forces.
Expanding internet access and growing smartphone users are bound to change the future of the world economy. Yes, Digital transformation has brought a paramount shift to the traditional ways of manufacturing, handling, storing and transporting things.
Digital transformation lies in leveraging new technologies to ensure scalability and elasticity demanded by customers.
The below stats shows the estimated IT expenditure of small-to-medium-sized enterprises (SMEs) worldwide in 2017, 2018 and 2021. In 2021, SMEs are expected to spend 684 billion US dollars on IT hardware, software, and services, including business services, worldwide.
IT expenditure from small-to-medium-sized businesses (SMB) worldwide in 2017, 2018 and 2021 (in billion U.S. dollars)
In this modern era of all things digital, it is interesting to note how traditional small businesses have adopted digitization. Chitale Dairies from India is a live example. They took their “cows to the cloud”, yes! Dairy farming with cloud computing is exactly what they have implemented. RFID (Radio Frequency Identification) tags on the cows collect vital information on the animals’ health, nutrition, etc., the data is then virtualized, interpreted and insights are sent to the farmers via SMS. They can then look after their animals better to yield the best quality milk.
Digitized SMEs are capable of diversifying consumer segments in a short period compared to offline businesses by
Let's dive into these metrics: