Decoding Digitalization: Why we must break down barriers for SMEs

SMEs have been underserved by the technology and telecoms industries

News By Marika Auramo published 6 November 2024

Small and medium-sized enterprises (SMEs) are the beating heart of Europe’s economy, employing around 90 million people, creating 85% of new jobs every year and adding value of more than €4 trillion. However, in a rapidly evolving business environment where the competition for customers is more intense than ever before, digital innovation is vital for these businesses to grow.

I am proud to have started my career at start-ups and so I know first-hand that when digitalization is done right, SMEs can reap enormous rewards – increasing their speed to market, making them more efficient, providing the tools required to protect their businesses from threats.

This requires access to the right technologies and support, which for many small businesses are often out of reach. Indeed, our research on SMEs has found that more than 1.2 million European businesses with less than 250 employees are yet to digitize fully, highlighting the scale of the challenge that this sector faces.

Marika Auramo

CEO of Vodafone Business.

Underserved SMEs

The reality is that for years SMEs have been underserved by the technology and telecoms industries. Instead of the right solutions that match the needs of their businesses, SMEs have been offered ‘off-the-shelf’ solutions that are more suited to consumers rather than small businesses. Research by Analysys Mason from last year found that 69% of SMEs in the US switched service provider because they felt product and service options were not tailored to their needs. This is symptomatic of a landscape where larger corporates are prioritized over smaller companies - and it is not contained to North America.

Combined with additional barriers such as funding shortages, and limited time and resources that were highlighted by our survey of 3,000 businesses across 11 European countries, SMEs are left facing a series of obstacles that prevent them from unlocking the benefits that effective technological transformation of their business will bring.

That is why as an industry, we need to step up to better support SMEs in their digitalization journeys.

We need to create solutions that don’t just work for SMEs, but which are made for SMEs – for example tailored security services that match the needs of their organization, or AI tools that empower SMEs to boost their productivity and efficiency in ways that are bespoke to their business.

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