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Fostering digital transformation for SA’s SMEs: building for the future

Article by Shelley Wanless (Small Business Lead South Africa & Egypt: Cisco)

It is indisputable that the COVID-19 pandemic and ensuing local lockdown have put major pressure on our local small and medium-sized enterprises (SMEs), a sector upon which the South African economy relies heavily as it employs a large percentage of the workforce.

According to McKinsey & Company, SMEs across South Africa represent more than 98 percent of businesses, employ between 50 and 60 percent of the country’s workforce across all sectors, and are responsible for a quarter of job growth in the private sector. “…there is no doubt that this sector is a critical engine of the economy,” the global management consulting firm said.

It’s an unfortunate truth though that, during times of crisis, SME businesses are often less resilient. “This is because typically they have limited cash reserves, smaller client bases, and less capacity to manage commercial pressures than do larger companies,” the McKinsey & Company article continued.

Nevertheless, it is not all doom and gloom for the South African SME. Small businesses can be more agile than their enterprise-level counterparts, meaning that they can recover faster and bounce back by adapting, adopting, and persevering. The silver lining shining through is that it is possible for SMEs to weather the COVID storm, and the way forward is digital transformation.

This fact has been underscored in the 2020 Small Business Digital Maturity Study, commissioned by Cisco and conducted by IDC, which revealed that those SMEs fully embracing digitisation actually saw revenue grow eight times faster than those that didn’t.

Through digitisation, SMEs can become more adaptable to the changing work environment. An example is to be able to shift seamlessly between remote working to office operations and back, as needed, for office workers. New technologies can improve competitiveness, closing the scale gap between SMEs and larger enterprises, as well as build greater future resilience.

McKinsey & Company highlighted the fact that, in South Africa, “because of their critical role in job creation and growth, protecting and enabling SMEs during this period of economic turbulence is important, not least because their survival and recovery is likely to be a bellwether for the economy as a whole.”

Cisco could not agree more. So much so that we’ve intensified our focus on helping SMEs to accelerate their digitisation agendas and future proof their business offerings, empowering them to better adapt to the current climate by staying connected, protecting vital resources, maintaining productivity and closely managing expenses and cash flow.

Enter Cisco Designed…

While many small businesses might look at the Cisco portfolio and assume that our solutions offering would be too big, too expensive and too complex for the smaller organisation, this is simply not the case.

Cisco has curated its portfolio to extract those solutions that work well for the smaller business, providing a simple-to-deploy, proven offering that is also affordable. Called Cisco Designed, this subset allows the small business to communicate and collaborate, while focused strongly on simplicity and security.

Cisco Designed addresses a number of common technology-related challenges faced by the smaller company, which have been brought into stark relief over the past year. These include the new hybrid workplace, where staff will likely continue to split their time between the office and home for the foreseeable future, as well as protection against cybercrime. This is of particular importance, with spiralling incident numbers over the past year a direct result of more remote working environments and unprotected end user devices.

It also encompasses safe web browsing, collaboration tools for virtual meetings and conferencing, a next-generation firewall, and in particular network authentication.

More than 80 percent of breaches are linked to poor passwords. To put this into perspective, over half the small businesses surveyed by Cisco stated that they do not have a password protection policy in place. Many networks allow for one method of authentication, which grants access to the whole internal internet of the company, but this is clearly not safe or secure enough.

Think of network access in terms of drawing cash at an ATM; you must have two authentication methods to access your account, using both a physical card and a PIN number to take out money. By using multi-level authentication on their networks, small businesses will always know that the people accessing their network are who they say they are.

Cisco Designed provides a smaller, simpler version of the wireless access points, switches and routers that comprise any network, offered in either the cloud or on-premises versions as preferred.

Furthermore, the cloud iteration of this offering comes complete with smart cameras, which can help companies manage physical security, as well as adding business value too. This could pertain to monitoring social distancing requirements, for example measuring that people within a retail environment adhere to two metre distancing and identifying foot traffic within a business.

Cisco has not only addressed the technologies needed to help small businesses. It has also put the right resources in place, building a community of small business partner specialists globally, including for the Middle East and African region.

We’ve seen on a global level – even prior to the pandemic but even more so since – that small businesses have been amongst the first to digitise, to actually convert their business design and processes to online, an app or a website.

And, in an increasingly connected world, this type of digital transformation will help ensure the local SME’s survival in this new environment and into the future.

Cisco is a proud Partner of the NSBC