WEF says 67% of SMEs worldwide fighting for survival
By Joy Obakeye
The World Economic Forum (WEF), and the National University of Singapore Business School, in it’s latest report has indicated that 67% of executives from small and medium enterprises (SMEs) cite survival and expansion as their main challenge.
The report found that amid recession fears, business leaders cite survival and expansion as their top challenge in a global survey of 800 executives of SMEs and mid-sized companies.
SMEs are the backbone of the global economy, creating close to 70% of jobs and gross domestic product (GDP) worldwide, even as the report highlights opportunities for boosting their future readiness.
Enterprise managers cite low margins, the challenge of scaling the business and expanding to new markets, and clients/consumers as the main pressure points.
The report, “Future Readiness of SMEs and Mid-Sized Companies: A Year On,” looks at companies emerging from the pandemic.
It builds on analysis of over 200 peer-reviewed articles and the quantitative and qualitative surveying of about 800 leaders and executives from SMEs and mid-sized companies.
Business leaders also cite talent acquisition and retention (48%), culture and values (34%), funding and access to capital (24%), as well as non-favourable business policy environments (22%) as their biggest challenge.
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The report also identifies pragmatic ways for smaller companies to embed future readiness into corporate strategies and highlights sustainability and digital transformation as two overlooked challenges.
It focuses on how smaller companies can boost their resilience through stronger business frameworks. It also highlights how their high level of agility can benefit the development and implementation of: Enterprise managers cite low margins, the challenge of scaling the business and expanding to new markets, and clients/consumers as the main pressure points.
The report noted that while smaller companies can increase their future readiness, the wider policy environment – such as the infrastructure for digital trade and finance – has a direct and important impact on their ability to thrive.
It is, therefore, key for policy-makers, investors and other stakeholders to do what is in their capabilities to contribute to building the future readiness of this segment of the economy.
“The business community is stepping up to tackle the biggest issues facing the world. SMEs and mid-sized companies are key enablers in this pursuit. This report sheds light on some key opportunity spaces for SMEs and mid-sized companies to do exactly that,” said Børge Brende, President, World Economic Forum.
Rashimah Rajah, Professor at the National University of Singapore and co-lead author of the report, added: “SMEs and mid-sized companies have unique strengths in their ability to pivot their business models to be more future ready and, by hiring and developing the right talent, they can mobilize positive internal and external change faster than larger companies.
“However, to fully realize their potential, they also need the support of policy-makers in recognizing their credentials as well as in rewarding sustainability initiatives.”
