In a time of economic uncertainties and where more organisations have to adapt to a new normal, including remote working practices, a study conducted by SAP and Oxford Economics revealed that small and medium-sized enterprises (SMEs) in the Asia Pacific (APAC) region are uniquely positioned to adapt and thrive in the post-Covid-19 business environment.
The study, which surveyed 2,000 senior executives from SMEs across 19 countries and industries, also delved into the priorities, challenges, and digital maturity of SMEs in the Americas, Europe, and APAC.
Of the total respondents, 832 of them were from Australia, China, India, Japan, New Zealand, 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.
According to the 240 who responded to the series of Covid-19-related questions, SMEs in the APAC region are well-positioned to adapt to a remote working environment by implementing and adjusting remote arrangements quickly for employees in response to the onset of the pandemic.
In APAC, some 77% of the respondents said they made adjustments for employees to work remote compared to their counterparts in Europe (75%) and the Americas (71%).
Additionally, 61% of APAC SMEs surveyed created remote work set-ups for employees during this period, while 69% invested in IT and collaboration solutions to support remote access, as well as online learning. Notably, 10% of APAC SMEs reported that the pandemic has no impact on their ability to accommodate remote work and maintain employee productivity.
When it comes to supporting business continuity, a higher number of SMEs in APAC compared to their counterparts are actively exploring new channels to get their products and services (66% compared to 64% and 59% in the Americas and Europe respectively) to their customers. On developing new products and offerings, SMEs in Europe led the way at 49%, followed by SMEs in APAC at 46%, and 40% in the Americas.
“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,” says 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," Cone adds.
The onset of the Covid-19 pandemic meant that some businesses were unable to operate at full capacity, and thus being unable to cope with ongoing demands. As such, some respondents reported that they had to completely restructure their business strategy and operations to mitigate the impact of the pandemic.
Prior to the Covid-19 outbreak, SMEs in the region reported being optimistic about their long-term prospects. Majority of SMEs in APAC were positive on their outlook, and expect that over the next three years, their market share (62%), budget or revenue (76%), number of full-time employees (59%), and profitability (78%) will increase – either somewhat or substantially.
Looking ahead, 40% of APAC SMEs are prioritising improving the customer experience, 38% are focused on growing their companies, and 28% are focused on attracting new customers.
“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,” says 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 organisation, 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 adds.