MSME Technology Trends for 2021
The pandemic year has been a tipping point for over 7 crores micro, small, and medium enterprises (MSMEs) which account for 40% of total exports, 45% of total industrial production, and 30.5% of services to India’s GDP.
Covid-19 has helped digitally aware businesses (food & beverage outlets, auto-ancillary, retailers, training institutes, etc.) to mirror their physical presence to the internet and mobile ecosystem. However, a significant number of MSME’s, who had a poor digital understanding, found it extremely difficult to carry on their daily operations. Now in 2021, they have come to realize the need to prioritize digital tools in improving human efficiency and productivity, enhancing data security, and upgrading customer service.
In 2021, MSMEs are now moving their business-critical applications to Cloud and taking benefits of free credits, SMB discounts, and GTM programs due to stiff competition between AWS, Microsoft Azure, Ali Baba Cloud, and Google Cloud. Unlike large enterprises who can utilize their IT resources for tech-development and roll-out, MSMEs are relying on simplistic and self-service tools (DIY, do-it-yourself) that make a quick and direct impact on their business. SaaS, another type of offering is ideal because it is very cost-effective and helps gain access to the same enterprise-grade, secure, modern technologies that are available to large enterprises. Who would have ever thought that one day we can have a CRM/email/invoicing system at around Rs 100/month and not worry about reliability, management, hosting, etc.?
Additionally, MSMEs want to improve their competitiveness by mass personalization and outreach to the market at scale. Effective collaboration and remote work management within its workforce are another key focus area for MSMEs, as they look for reliable, cost-effective HR-Tech solutions for messaging, team conferencing, virtual desktops, and product learning and training.
MSMEs are becoming more cautious about privacy and are starting to use licensed and paid software instead of the free consumer ones (that give access to sensitive company data to 3rd party companies for marketing). So, MSME’s benefit by becoming more private and safer not only for themselves but also for their customers, directly increasing their business footprint. In fact, according to a recent survey conducted by an SME agency, 34% of MSME’s, not just in metros but even in Tier-II and III cities have already adopted digital tools for interactions with employees, customers, and suppliers. More importantly, 50% of the MSME respondents have claimed benefits in terms of profitability by going digital.
State of MSME Digitization (IT Software)
1. Basic (56%): Productivity & Email software (Emails, Website & Social Media)
2. Intermediate (34%): Cloud Storage, CRM, ERP, CMS & Workforce Collaboration tools
3. Advanced (10%): AI-powered – Analytics, Big-Data, Automation
The need of the hour is for MSMEs to make technology and digital solutions at the center of all business strategies to get to the next level of business growth.
The pandemic year has been a tipping point for over 7 crores micro, small, and medium enterprises (MSMEs) which account for 40% of total exports, 45% of total industrial production, and 30.5% of services to India’s GDP.
Covid-19 has helped digitally aware businesses (food & beverage outlets, auto-ancillary, retailers, training institutes, etc.) to mirror their physical presence to the internet and mobile ecosystem. However, a significant number of MSME’s, who had a poor digital understanding, found it extremely difficult to carry on their daily operations. Now in 2021, they have come to realize the need to prioritize digital tools in improving human efficiency and productivity, enhancing data security, and upgrading customer service.
In 2021, MSMEs are now moving their business-critical applications to Cloud and taking benefits of free credits, SMB discounts, and GTM programs due to stiff competition between AWS, Microsoft Azure, Ali Baba Cloud, and Google Cloud. Unlike large enterprises who can utilize their IT resources for tech-development and roll-out, MSMEs are relying on simplistic and self-service tools (DIY, do-it-yourself) that make a quick and direct impact on their business. SaaS, another type of offering is ideal because it is very cost-effective and helps gain access to the same enterprise-grade, secure, modern technologies that are available to large enterprises. Who would have ever thought that one day we can have a CRM/email/invoicing system at around Rs 100/month and not worry about reliability, management, hosting, etc.?
Additionally, MSMEs want to improve their competitiveness by mass personalization and outreach to the market at scale. Effective collaboration and remote work management within its workforce are another key focus area for MSMEs, as they look for reliable, cost-effective HR-Tech solutions for messaging, team conferencing, virtual desktops, and product learning and training.
MSMEs are becoming more cautious about privacy and are starting to use licensed and paid software instead of the free consumer ones (that give access to sensitive company data to 3rd party companies for marketing). So, MSME’s benefit by becoming more private and safer not only for themselves but also for their customers, directly increasing their business footprint. In fact, according to a recent survey conducted by an SME agency, 34% of MSME’s, not just in metros but even in Tier-II and III cities have already adopted digital tools for interactions with employees, customers, and suppliers. More importantly, 50% of the MSME respondents have claimed benefits in terms of profitability by going digital.
State of MSME Digitization (IT Software)
1. Basic (56%): Productivity & Email software (Emails, Website & Social Media)
2. Intermediate (34%): Cloud Storage, CRM, ERP, CMS & Workforce Collaboration tools
3. Advanced (10%): AI-powered – Analytics, Big-Data, Automation
The need of the hour is for MSMEs to make technology and digital solutions at the center of all business strategies to get to the next level of business growth.