What Swiss SMEs understand by digitalization
Digitization is changing all SMEs - but not equally and not simultaneously. This is the quintessence of the new SME mirror of the University of Applied Sciences St. Gallen. A total of seven industries were examined and the central results were recorded in six findings.
The SME Mirror 2017 is dedicated to the question of what opportunities and challenges Swiss SMEs see in the context of digitization. In its fourth SME Mirror, the Institute for Corporate Management IFU-FHS at the University of Applied Sciences St.Gallen finds that there is a great deal of uncertainty, particularly among small and medium-sized enterprises (SMEs), as to what they should focus on when it comes to digitization, because although digitization is leading to changes in all industries, it is doing so to varying degrees and at very different speeds. The study delves deeper into the insights gained from the perspective of Swiss SMEs and takes a detailed look at industry-specific peculiarities.
Digitization is not the same everywhere
Although everyone is talking about digitization, it is probably also being discussed under different headings, so that there is still no clear understanding of the term, explains Prof. Dr. Rigo Tietz from IFU-FHS, one of the authors of the study. Although most companies are already pursuing digital projects, very different "digital" topics are important for the various industries.
The responses of the study participants indicate that digitization will lead to changes in all industries. "However, the extent and speed of the changes vary greatly from industry to industry," says Tietz. For example, in manufacturing and construction, he said, efficiency improvements are a top priority. For service companies, it is automation, while for the ICT sector, new business concepts are the main focus. In the retail and hospitality sectors, market-related aspects such as new customers and digital sales channels are very important. In the healthcare and social services sectors, the main focus is on the use of patient data, according to the study authors.
SMEs see both opportunities and challenges
The biggest challenges of digitization do not lie solely on the technical side, the authors of the study note, writing: "SMEs often lack the necessary financial resources to cope with the high investment requirements." They identify a lack of skills among employees, increased market transparency, and changes in the industry and competitive situation as further challenges. After examining the industries studied, the authors conclude that the challenges differ from industry to industry and are therefore diverse overall. ICT companies, for example, fear the entry of new competitors, while data security is at the top of the agenda in the service industry and for companies in the healthcare and social services sectors.
In fact, however, the SMEs surveyed tended to perceive digitization as an opportunity, says Rigo Tietz. As a trend across all industries, the participants described efficiency increases through the automation of processes as the greatest opportunity. However, digitization encompasses not only the process of service provision, but also the marketing strategy and the revenue model, which in turn can significantly change the value proposition of SMEs. "Companies from the ICT sector see the greatest opportunities, while trading companies see an almost balanced picture between opportunities and challenges," Tietz illustrates with two examples.
The complete study can be downloaded at the link www.fhsg.ch/kmu-spiegel can be downloaded.
SME Mirror - Background
The results presented in the SME Mirror 2017 are based on a nationwide online survey conducted between January and April 2017. The results were supplemented by expert interviews with representatives from professional and industry associations and various companies. The research also incorporated the findings and results of further studies and analyses by industry associations, institutions or companies. The result is a comprehensive, industry-specific picture of business management aspects in general and success strategies in particular for Swiss SMEs.
The KMU-Spiegel 2017 was made possible thanks to the financial support of Helvetia Switzerland, BDO and Raiffeisen Switzerland and is also supported by the Swiss SME Association.
