Panelists from Wong Fong Industries, Estil Furnishing and Ngee Ann Polytechnic share their insights at The FinLab

The advent of the new digital age has been coined by some as the 4th Industrial Revolution. Digitalisation is reshaping consumer behaviour, and in turn businesses, with new tech solutions being developed at an unprecedented pace. For the Small and Medium Enterprises (SMEs) today – who account for majority of businesses in Singapore – the rate of change means that there is much ground to catch up on, especially for SMEs operating on a traditional business model.

This speed of change was recently discussed at our Smart Business Transformation event for SMEs held at ACE International Centre on 8 February 2018. The FinLab’s MD Felix Tan moderated a panel comprising Patrice Choong, Director of the Sandbox at Ngee Ann Polytechnic (NP); Eric Lew, Executive Director of Wong Fong Industries; and Darren Lim, Marketing Manager of Estil Furnishing.

While the need for transformation was evident because of the rapidly evolving landscape, the panel shared insights on challenges faced by SMEs embarking on this journey. These include finding the right talent, managing change within the company, and having the right skillsets and knowledge to strategise and innovate.

“SMEs find it difficult to scale overseas”, said Patrice, “mainly because it is challenging to find the right talent willing and able to relocate to other countries”. Patrice subsequently shared that educational institutions like NP are looking to help the SMEs bridge this skills gap. “By allowing students to run their own start-ups in exchange for academic credits, we are empowering them with the practical, real-world skills that the businesses of the future so greatly desire”, he said.

Additionally, Darren mentioned that it was “difficult to convince [his] parents to digitalise because they were initially quite resistant to change,”. He continued that business transformation typically “happens from the top down, and it is hard for someone in the middle to work against that flow of authority to bring about change,”. This underlines the major issue facing all new technologies today – that no matter how useful or relevant the technology is, its application in the real world will face the natural change resistance of the people who will be using it or the people that will be displaced.

Change management is hence a core skill that SME leadership teams will need to have, as well as the ability to lead the company amidst the rapid winds of change.

Despite the challenges raised, the panel maintained an optimistic outlook. Technology is now more accessible than before, with cloud-based solutions that can enable SMEs to adopt proportionately with its growth. If used appropriately and combined with the right strategy, technology offers SMEs a chance to level the playing field and reach new customers. .

Eric noted that SMEs could also have the agility of a start-up, if armed with the right mindsets and skillsets for innovation and progressive change. This is something that can be first imbued in the classroom, and then inculcated through frequent practice.

The panel agreed that SMEs enjoy the great breadth that the ‘Singapore’ brand carries. “As a centre of political stability and economic prosperity, Singapore serves as a gateway to ASEAN and the world,” Patrice said.

So despite the shifting headwinds of change, the SMEs in Singapore have a chance to innovate and digitalise, forging the way as the next generation of SME champion for Singapore. The need is clear, and probably easily summarised in the common saying “Innovate or die.”