The Age of Disruption
This is from a copyright-free email sent to Tekedia. It was written by Gilbert Saggia of SAP Africa. I have noted some interesting things that would explain why innovation is key.
Disruption is Alive
African small and medium enterprises (SMEs) are facing unprecedented disruption. While large global disruptors have claimed most of the news headlines, SMEs face the same threat from disruption as their larger, more established peers. Of the companies featured on the Fortune 500 list in 1955, only 12% were still on the list in 2015. The rest were acquired by a larger competitor, filed for bankruptcy, or simply faded away into relative obscurity.
Technology is driving sweeping changes across entire industries, unseating market leaders in a matter of months. As the likes of Kodak, Blockbuster, and RIM can attest, the cost of not adapting to disruption is often outright business failure. Digital transformation is therefore imperative for modern SMEs, as it enables them to streamline back-office operations and free up time and resources to focus on their core business.
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SME is Key to Growth
According to the World Economic Forum, SMEs contribute to around 80% of the African continent's employment, driving the creation of a new middle class and fuelling demand for new goods and services. Of late, SMEs have also seen a levelling of the playing field with their larger competitors: in a recent IDC study, more than 70% of SMEs that have adopted cloud services said their highest expectations in terms of benefits were met or exceeded. In a separate study, two out of five SMEs saw their smaller size as an advantage over bigger companies as it allows them to move faster and take advantage of emerging opportunities.