It is estimated that there are more than 200,000 SMEs in Singapore. The majority of these businesses have, in the recent years, transitioned from the traditional brick and mortar model to the e-commerce model, it is understandable that, for some SMEs, taking the first steps towards digitalisation can be a daunting task.

What would be our advice to SMEs who want to embark on this journey but are not sure where and how to start?

Digitalisation should not be viewed as new technology implementation solely to drive productivity and efficiency. SMEs can embark on digitalisation as the initial steps in a strategic transformation for the business. As a starting point, they need to have a clear vision of the objectives they hope to achieve by going digital. Some questions they could consider include:

• “What competitive advantages do they hope to gain over their competitors from digitalisation?”
• “Can they leverage digitalisation to change their business model for growth?”
• “Will digitalisation fundamentally change how they deliver their products and services, to the benefit of their customers?”
• “Can digitalisation fundamentally change how they manage their resources?”
  
  

SMEs should view digitalisation as an enabler for value creation, in order to sustain growth. They can assess which areas to prioritise their digitalisation efforts, by utilising a value chain analysis approach. This can be done by analysing all their primary and support activities, and identifying in which activities the business can deliver greater value to its customers and stakeholders by leveraging digital technology. To plan for this effectively, SMEs should acquaint themselves with the relevant technology solutions available in the market, as well as what their competitors may have already adopted.

The common adage “automating a bad process is still a bad process” continues to ring true. In this aspect, it is important for SMEs to conduct business process reengineering in conjunction with digitalisation. This will help ensure that existing pain points in their key processes can be adequately addressed with digital solutions, and for these solutions to be well integrated within the company’s business processes. This will minimise the risk of the new technology solutions becoming under utilised soon after implementation.

The Singapore Government has been supportive of SMEs embracing digitalisation and has introduced various grant and support schemes to help SMEs defray some of the costs involved in the adoption of digitalisation. The Infocomm Media Development Authority has also developed Industry Digital Plans for ten selected sectors. These plans provide guidance to SMEs on the digital solutions to adopt at each stage of growth and the training programmes to enhance their employees’ digital skills. SMEs planning to go digital should refer to these guides and assess whether any of the support schemes are applicable to them.

For SMEs who are still pondering over the need to go digital, the train of digitalisation has already left the station. We believe that there is a good chance of catching up with it if you embark upon the journey now by adopting the right approach. We hope that this will be one of your top priorities in 2020.

Sectors covered by Industry Digital Plans:

• Accountancy
• Environmental Services
• Food Services
• Hotel
• Logistics
• Media
• Retail
• Sea Transport
• Security
• Wholesale Trade