25 July 2017

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MS Opens 'Windows' of Opportunities for the SME Segment

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With over 4 Million SMEs functional in India, Microsoft is one such technology company that looks at this segment extremely closely and reaches them at their doorstep. Sharing his company’s strategy, focus and observations towards this market, Rajesh Kumar, Senior Director Strategic Business, Microsft India interacted with Faiz Askari from Small Enterprise India.com.

According to Microsoft, what is the definition of a typical Indian SME?

Our SME definition is slightly different. We rate SMEs from the perspective of their IT infrastructure. There are over 4 Million SME set ups existing in India. But our estimate says that out of these many SMEs 34 % SMEs have computing penetration. We see huge scope of technology for such businesses. However, the remaining SMEs are also getting into IT adoption at initial levels. Microsoft focuses on this segment very aggressively and dynamically.

We look at these SMEs according to their exclusivity, out of the entire SME landscape, 40 to 50 thousand SMEs are existing in India with somewhat structured IT infrastructure.

What are the salient features of a typical Indian small business entrepreneur?

Small & Medium Business organisations are spearheading India’s growth, but always facing challenges to sustain and build on their entrepreneurial success. The SME sector has contributed to cost-effective growth, social cohesion, employment and wider avenues for enterprising leaders in the economy. The key to enhance business process efficiency that allows simplified view of operation is achieved with well thought business strategies and implementation of the world class technologies & practices.

Running a small business can also require your input on everything from finances and marketing to human resources and customer service. You might even act as head of sales, operations manager and IT specialist — all on the same day.

What does technology can bring to the table for an SME organisation?

Adopting the most recent IT technology will result in immediate and long term benefits to the SME segment by optimising business processes, reducing operational costs, enhancing customer acquisitions & retention. There are considerable challenges that SME’s must accept and be thoroughly equipped to deal with and a client-base that is demanding global standards in quality, prices and timelines.

Can you share the market strategy of Microsoft for this segment?

Microsoft’s plethora of product offering caters to entire landscape of SMEs ranging from one license to Windows Small Business Server to MS Office and Windows OS. We also look at informing the SMEs with correct set of technologies that may fit in their business environments and which can help them in doing business, smoothly.

Having said this, we have categorised the SMEs into three stages of their technology adoption. A SME considered to be in the first stage of technology adoption when they are looking at basic productivity. Similarly, the second category talks about such companies which are looking connectivity within the organisation. This stage includes companies which have implemented some email messaging solution, some networking solution so on and so fore. The third category of SMEs are those organisations which are looking at next level of IT implementations for example, they could be having computing network for their customers, distributors etc.

In a step towards creating awareness of the challenges faced by SMEs in India and to give a way forward for them, Microsoft commissioned AMI partners – a well respected name in ICT research & consultancy to conduct a study across SMEs in India.

Can you highlight some of the key findings of this study?

Some of the key findings of this study help us understand the SME universe better. The number one challenge for SMEs is rise in competition followed by pricing-pressure in the market and managing customer expectations. There is also a realisation amongst SMEs about the need for technology to grow their business, and while more than half (58%) of Medium Enterprises are in the second stage of IT adoption wave, majority of Small Enterprises are still at the first stage! Meanwhile internet penetration is also growing – 60% in Small Enterprises and 96% in Medium Enterprises owning PCs. AMI Partners estimate that there are 3.98 Million SMEs in India, and No. 1 focus area for them is topline revenue growth. A vertical industry-wise break-up of these businesses reveal that retail (41%) and manufacturing (17%) are the top two verticals constituting 58% of SMEs, and from a regional analysis of SMEs – the west and south comprise 66% of the SMEs.

What is your unique observations regarding the SMEs in India?

The Indian SME segment is vast and fragmented, the biggest opportunity is to go beyond the four national metros. A typical SME business owner understands the opportunities around his business. The SME entrepreneur understands that globalisation of business is taking shape. But he doesn’t know about what can his business avail from technology or what does technology can bring to his business. Sometimes sourcing of right mix of technology also becomes an issue.

Microsoft has also launched an online resource portal for SMEs, please explain the initiative how you are reaching out to SME thorough this initiative?

Microsoft SME portal is the most favored forum for small & medium sized organisations to augment business process efficiency. It is a definitive online repository that provides information on hardware products, software, useful business tips, software support and more to help resolve any IT-related operational concerns. The available range of products from an operating system to a complete ERP ensures your business is ready with the required resources to achieve new levels of productivity.

The all-new SMB portal has been receiving good acceptance. This online repository has all the underpinning information required to help SMBs run their businesses smartly and forge ahead in the right direction. With features like Product Comparisons, Open Value Licensing Program, Updated directory of Microsoft Partners and Solutions, Useful Business Tips, SME IT Tutorial Guides and many more business articles, the portal is surely a one-stop for all your IT solutions.

What are the challenges of an SME entrepreneur?

A typical SME entrepreneur understands the need of IT. But the main issues comes when they did not get sufficient professional experts joining them. Apart from this problem, another factor that effects negatively on the adoption of technology among SMEs is the fact that they are usually extremely price sensitive. Apart from these,piracy  is among top problems that the small business is suffering. The only solution for this evil is right awareness and understanding of having authentic software infrastructure.

 

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