These are harsh words: According to the „Digital Switzerland“ study conducted by the “Institute for Digital Business” at the University of Applied Sciences in Business Administration in Zurich, 85 percent of SMBs in Switzerland are still classified as “digital dinosaurs”. They have digitised neither the customer experience nor their operational processes. Only a quarter of the SMBs surveyed for the study have a digital strategy for the entire company.

Multiple causes for digital backlog

The situation in other European countries is not better. Here, too, medium-sized companies are the backbone of the economy and represent 99 percent of all companies, which account for two thirds of all jobs in the private sector. But in virtually every area of digitisation, SMBs score worse than large companies: While 94 percent of them, for example, have their own websites, this applies only to 77 percent of smaller businesses. Around 90 percent of large companies have access to IT specialists, while this figure for SMBs is only 65 percent. And only eight percent of European SMBs make use of the opportunities offered by e-commerce.

There are many reasons for this backlog. Often the necessary capital for investments in digital technologies is lacking. And if the current business is going well and there is no free capacity, often there is not the necessary incentive and corresponding projects are postponed. The lack of digital competence in the own workforce and the slow Internet in the countryside is also a frequently mentioned obstacle. The issue of IT security, which plays a recurring role as one of the biggest challenges in digitisation, is also one of the hurdles.

Change must come from the top

However, the willingness to change on the executive level is also decisive. And this above all has to do with corporate culture and leadership. In order to take away fears and achieve identification, managers have to exemplify digital thinking and show again and again which positive changes can result from it. Proven traditions must not stand in the way of changing working conditions and redesigning internal processes. All areas of the company must be put to the test.

Especially for many medium-sized businesses, which are often strongly positioned regionally, digitisation opens up the possibility of reaching an international market or different and larger customer groups. Among the areas that generally benefit most from digital transformation, even in SMBs, are:

  • The production through the analysis and linking of manufacturing data for the optimisation of the processes up to the faster new development of products,
  • the logistics, so that storage and transport, as well as procurement, can run more efficiently,
  • the entire human resource management including the easier recruitment of qualified employees and
  • above all, simplified and faster communication with customers and suppliers.

Widespread silo thinking leads to a patchwork

Whether online marketing, the use of digital sales channels or the improvement of production processes – the opportunities for digitisation are manifold. This is also demonstrated by a number of successful digitisation projects in SMBs. However, the overall picture is usually more like a patchwork. “A large number of pilot projects clouds the view of the whole,” criticises the strategy consultancy Accenture. Four out of five pilot projects are abandoned or are unsuccessful, according to a study carried out by the consultants.

A widespread silo thinking is to blame for this. Even today, the perfect demarcation still prevails in many companies, from the boardroom to the doorman. Their advice therefore: “Those who want to convert the digitisation successfully, must consider it from the customer end-to-end. From the first contact to the individual production of products through the associated services.”

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