Should SMEs prepare for the future – Change!

Melissa Coggan - Thursday, February 02, 2017

Guest blogger, Deepika Ramesh, SME Management Consultant

Louis Pasteur, in the mid-19th century, stated that ‘fortune favours the prepared mind’. We can extend on this reflection to a business context to state, ‘fortune favours the prepared SME’.

I often ask my clients and webinar participants to think of answers for the following questions 

  • Why should an SME care about change and transformation?
  • Is it mandatory to make a convincing business case for change?
  • How can SMEs make change profitable?
  • How does change help SMEs to prepare for the future?

Majority of the answers were in the lines of - business owners:
  • Fear the word ‘Change’ itself.
  • Scared of the unknown, costs and failure.
  • Driven by well-honed habits.
  • Convinced that the past will appear and save them.
  • And that, change and transformation is not for them, its for someone else!

Change is not about changing the ‘look and feel’ of the business. It is also not about introducing new products or services, processes or culture or completely remodelling business strategies. But it is to keep up with the new normal, SMEs must revitalise and reinvent themselves regularly. This will help them stay tuned with the new market challenges and demands.

The reason is that businesses today are operating in a modern, complex, challenging and unpredictable market environment. Consumer expectations and preferences are changing. Communication is expected to be immediate and businesses are now becoming an open book! The traditional ways of marketing, e-commerce, operational process, use of technology are no longer the same. In addition, external triggers such as government laws and regulations, globalisation of markets, border-free trade, advances in technology, supplier requirements, increasing competition, organisational growth and fluctuations in business cycles are creating enormous pressure on SMEs to either quickly adapt to change or perish!

Therefore, in the current business environment, competitiveness and survival is directly linked to SMEs ability to prepare for the future – ‘change and transform’. Change brings value to the entire value chain of the business. It benefits to stay in or ahead of the competition making you emerge stronger and more dominant.

SMEs are actually better placed to change and transform than large organisations. This is because of the close association with their customers, knowledge of their requirements and personalised service delivered to their customers. Their ability to respond quickly to market environments and internal flexiblity in providing tailor-made solutions gives SMEs a greater control for change.

Most importantly, a high level of commitment and a strong leadership by the business owner is essential for implementation of effective change. Updating themselves regularly with their industry information will allow them to get early warning signals on market changes. Without strong leadership, there can be very little change. Leaders must recognise and overcome any stumbling blocks and identify new opportunities to create sustainable growth for their future.

Finally, change must be beneficial to your business and generate revenue or reduce cost. It must be evidenced by the increments in business growth and revenue streams.

It is not the most intellectual or the strongest of the species that survives, but the one that is best able to adapt and adjust to the changing environment…
------Charles Darwin-----