A Digital Transformation Framework for SMEs to Go Digital

SMEs go digital with a digital transformation framework as it focuses on employing digital technology to improve a business model or process and/ or generate new revenue sources.

Essentially digitalisation, also known as “digital transformation”, is about transforming legacy business models to digitally-enabled ones, to achieve better business outcomes.

SMEs that go digital have grown faster and more efficiently. This is evident in the increase in their productivity and efficiency. A recent study shows that business has experienced an average revenue gain of 26%.

In Singapore, the government has stepped up calls for local businesses to digitally transform and support efforts through various funding options such as the Go Digital grant, Enterprise Development Grant (EDG), and Productivity Solutions Grant (PSG).

Digital Transformation Framework by J C Sum | Evolve & Adapt

Why Should AN SME Go Digital

The need for digitalisation became apparent at the onset of the pandemic lockdown and has continued to be a vital pivot in the evolution of every business, regardless of the industry or sector. In a previous article, we explored different ways businesses can grow in the post-pandemic market. Not surprisingly, the number one strategy discussed was digitalisation.

The need for SMEs to go digital is to be competitive in the digital economy. Some benefits of digitalisation include:

Improving Business Processes Operational Efficiencies

Businesses in industries like manufacturing and logistics can take advantage of digitalisation to manage their business processes and workflows.

Businesses that implemented digital solutions have been able to produce more with less. Automating business functions can improve efficiency, increase productivity, and reduce time & costs while limiting human error.

In addition, digitalisation can help businesses better manage their data. For example, a cloud-based business management software centralises the storage of information allowing the data to be assessed via the Internet at any time, from anywhere.

Capturing New Online Customers

The digital era has changed consumer behaviour forever as more customers (B2B & B2C) have moved online to conduct research and make purchases. Almost all businesses have seen a 15% – 30% growth in online purchases in recent years.

Digitalisation can help with customer outreach and engagement. Digital marketing uses digital platforms and automation tools to act as a business’ sales team 24/7.

SMEs that go digital also allows them for the collection of data and the ability to analyse data to identify customer satisfaction issues. A customer relationship management (CRM) software is one example of a digital solution that can help track customer preferences, the sales cycle, and their purchasing behaviour.

Improving Customer Experience

Besides reducing costs by automating processes or reducing human intervention, digital solutions and platforms can help improve customer experience and satisfaction by catering to their needs 24/7.

eCommerce platforms, online booking forms, digital services and streaming entertainment are just some examples of on-demand digitalisation that we now take for granted.

The 3 Pillars of Digitalisation Framework

While most businesses know that they need digitalisation, many are unclear how it applies to their business and how they should digitally transform.

Here is an original digital transformation framework developed by Evolve & Adapt that will provide a roadmap to guide businesses on their digital transformation journey.

Digitalisation can be divided into three pillars:

  • Digital Business Management
  • Digital Marketing
  • Digital Solutions
SME Go Digital with Digital Transformation Framework | Evolve & Adapt

Digital Business Management

Digital business management refers to undertaking all aspects of managing a business in the digital era. It covers understanding all stages in the business management process from strategic planning, organisational behaviour, workflow, operations, training, data-sharing, to finance.

Business owners and management must also have a keen understanding of the digital tools and resources available that can improve the productivity and efficiency of their business while reducing costs and human error.

Digital business management is the crucial first step in digitalisation or digital transformation. There is no point in engaging in digital marketing or investing in digital solutions when the digital strategy and business processes are not in place.

Digital strategy guides business management. Strategy is the application of digital technologies to your business model to form new differentiating business capabilities. In the future, all business strategy will be digital strategy.

When it comes to digital business management, the management team of a company must be equipped with the knowledge, tools, and skills to digitally transform. If not, external professional assistance should be sought. Astreem Consulting is an example of a consultant that helps enterprises identify bottlenecks in business processes and implements digital solutions that will reduce time and costs.

Change Management in Digital Business Management

An essential aspect of digital business management is addressing and adapting to change due to digital transformation.

This is known as change management and requires a company to prepare employees for the change through clear communication of the benefits and process of digitalisation. Employees must be adequately trained to take on new roles or learn a new way of operating. The goal is to get the buy-in of the entire organisation as the company moves forward with digital transformation.

For example, if an SME is implementing a new human resource management (HRM) software to help manage their staffing issues, the company’s management should pre-empt the staff about the new software, explain the benefits of digitising the HR process and provide functional training on the usage of the software. HR managers and executives should spearhead the digital implementation process to establish ownership and assist the rest of the staff during the transition.

Digital Marketing

The primary purpose of any business is to generate revenue and be profitable. This can only be achieved by generating sales from customers.

As the world goes digital, customers’ buying behaviour changes as more people move online to find products, services, and solution providers. This is where digital marketing is essential for brands and businesses.

Digital marketing can be defined as communication that uses digital channels and different digital marketing tactics to engage users with a brand’s digital assets (website, social channels and content). Brands must market online to connect, communicate and sell to customers who are now online.

Digital marketing in today’s market involves a combination of both inbound and outbound marketing.

Inbound marketing is a strategy where you create an online presence to market to customers already searching for the product or service they are looking for. These customers have what is called “search intent”. Search engine optimisation (SEO), content marketing and organic social media marketing are examples of inbound marketing as they cater to customers with search intent.

Outbound marketing is an interruptive marketing strategy where you look for customers and put your brand in front of them, even though they are not looking for a product or service that you offer. Outbound marketing includes paid online advertising (Pay-per-click (PPC), search engine marketing (SEM) and display advertising), email marketing, and influencer marketing.

As SMEs go digital with digital transformation framework, they must have a digital marketing strategy and marketing plan to map out which inbound and outbound marketing tactics are relevant. To ensure digital marketing efforts can be optimised, performance and data must be tracked and analysed.

Engaging a proven digital marketing consultant can prove to be vital to digitalising your marketing efforts, especially if you are moving from a legacy process of customer acquisition. Evolve & Adapt is an award-winning strategic marketing management consultant that has the technical expertise and skills of a digital agency. The firm works with businesses to develop and implement inbound and outbound marketing digital strategies to increase customer engagement and acquisition.

Digital Solutions

Only after planning your digital business management and subsequently crafting your digital marketing strategy can you determine what digital solutions you should adopt and invest in.

Digital solutions refer to IT solutions, software, apps, or online platforms that transform legacy business processes. They are designed to tackle problems in simple, efficient, innovative, and scalable ways.

Digital solutions that address the needs of your business can be very beneficial. Over time, a solution can save time and money through increased productivity and efficiency. Staff can spend their time on more critical tasks that can contribute to profitability. A centralised platform that allows data-sharing and communication can reduce human error and streamline work processes. Cloud-based solutions mean employees can work remotely, or international teams can work more effectively.

Some examples of digital solutions include enterprise resource planning (ERP) systems, business management software, cloud computing and storage, robotics & automation, mobile technology, design software and data analytics, to name a few.

These digital solutions and technologies can work together or apart, giving you the freedom to pick and mix the right solutions to suit your needs.

It is important to note that you should find solutions that fit your business needs. Many times, organisations get sold on an expensive solution and then adapt their business around the solution’s functionality and capability.

The digital solution must serve the business, not the other way around.

Examples of digital solutions include:

    • Video conferencing and communication – Zoom, Skype, Webex
    • CRM solutions for sales and marketing – Salesforce, SugarCRM, Agile CRM
    • Accounting/ Payroll software – Xero, Quickbooks, Financio
    • Security system – CloudStrike, Kaspersky, Mcafee
    • ERP for manufacturing – Scumatica, SYSPRO ERP, SAP® Business
    • eCommerce solution – Shopify, WooCommerce, BigCommerce
    • Content Management System – WordPress, Sitefinity, Joomla
    • Online storage – DropBox, Google Drive, OneDrive
    • Online design tool – Canva
    • Email marketing – ActiveCampaign, MailChimp, Constant Contact
    • Project management solution – Jira, Monday.com, Wrike
    • Marketing automation solutions- HubSpot, Freshworks, Zoho
    • Customer support software – Zendesk, Freshdesk, LiveAgent
    • Data Analytics – Data Studio, Tableau, Qlik Sense

Note that some software can be part of a bigger package or cross-functional software capability.

For example, Freshworks include other software like customer support and CRM. Quickbook is also packaged as a CRM software, and Shopify is also a CMS software on its own.

That means when you are looking for a digital solution, your solution can be a stand-alone or a packaged solution, and it can also be a purchase of different digital solutions.

The Urgent Need for Businesses to Digitalise

As Covid-19 continues and the world tries to adjust to endemic living, digitalisation is becoming increasingly important. Even when the pandemic is entirely over, the world will not go back to “normal”.

Workforces will continue to adopt remote or hybrid working arrangements. Buyer behaviour and first interactions with brands will take place almost entirely online.

Organisations will need to increase competitiveness by improving efficiency, productivity, and quality through digitalising their business processes. They will need effective ways to market their products and services online to acquire new customers.

There are many successful case studies of businesses that went through digital transformation. CosyCool Aircon adopted a digital field service management system to plan and manage jobs. The net result is better management of their staff assigned to their on-field jobs. I Can Read (ICR) digitalised their content and implemented virtual classes during the pandemic lockdown period to ensure continuity of their classes and business.

In a way, the pandemic has helped many businesses accelerate their digitalisation efforts. If you are still on the fence to digitally transform your business or are taking your time with the process, consider this quote from Theodore Roosevelt:

“In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing.”

If you need to speak to a digital consultant, contact our team below:

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J C Sum

J C Sum is a certified management consultant (TR 43:2015), an American Marketing Association Professional Certified Marketer (PCM®) in marketing management as well as a certified digital marketing strategist (SSG-WSQ accredited) with 12 years of experience specializing in search engine optimization, content marketing, and analytics. J C holds a Bachelor of Arts from National University of Singapore and is the author of "Evolve, Adapt or Collapse". He has been featured on The Straits Times, Business Times, Channel News Asia, The Edge Singapore, CNA938, and Money FM 89.3.

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