According to a recent Digitalisation survey from SME Corp Malaysia, Malaysian SME's have adopted computerisation (the use of devices and applications for individual use) but have not made the leap to true Digitalisation (where business processes are automated).
The study explored the adoption of different types of digital technologies, and categorised these into three groupings based on level of adoption, as shown in the below diagram.
Based on these findings, one can assume that SME’s primarily use ICT for communications and information. Applications that could have a significant impact on business productivity have very low adoption amongst Malaysia’s SME sector.
SME Corp Malaysia defined the large gap between adoption of Computing Devices+Connectivity versus adoption of Back-end Processes as the “digitalisation chasm”.
The below infographic illustrates some of the challenges that are preventing SME’s from making the leap over the digitalisation chasm between being computerised SME’s and becoming digital SME’s.
According to the SME Corp Malaysia Digitalisation survey, almost 50% of SME’s stated that business planning and strategy was a key challenge to becoming more digital. This is strongly linked to another key finding, that 48% of SME’s need to develop business and digital skill sets. Out of these 48%, 40% indicated that they needed training across Business Management, Sales and Marketing and IT related technical skills.
Today the lack of IT skills amongst SME’s means they are dependent on 3rd party IT service providers to create, manage and continually update their digital assets. This is a problem for two reasons. Firstly, as more of an SME’s business goes online, they become even more dependent on 3rd parties for their success, and secondly it is very difficult to be agile without ramping up costs.
Which brings us to the single biggest barrier to SME digitalisation - cost. Many SME’s think that ICT is expensive, and a significant share believe that cloud computing is expensive. Surprising, given that the major justification for cloud computing is that it is very cost effective.
Despite this perception, 44% of SME’s stated they were using cloud services, with the overwhelming majority using cloud for data storage (the simplest and easiest to understand Infrastructure as a Service offering). A third of SME cloud users, used cloud based applications (Software as a Service).
So, SME’s are using simple IaaS and SaaS offerings today. What they have not yet embraced is PaaS – Platform as a Service.
But it is PaaS which is likely to have the greatest impact on accelerating SME digitalisation in Malaysia and globally.
To be more precise, it is no-code platforms that have the potential to enable SME’s to make the leap over the digitalisation chasm.
Why? Because most of the back-end business process digital technologies are designed for larger companies following standards designed for large complex organisations. While SME’s are quite often niche and have their own custom processes.
Using off-the shelf back-end process digital technologies is probably going to cause more havoc to operations than good – which an SME cannot afford.
What is required is a simple, fast and cost-effective approach to digitise and automate SME back-end processes, which conform to the SME’s own custom processes.
This is exactly what no-code application development platforms can do.
At Apti Services, we use WEM, the leading no code development platform, to enable SME’s to digitise processes that they previously could not.
Listen to the CEO of Zoombim, creators of WEM, talk about how no-code software development will cause a paradigm shift in the world of ICT.
WEM can reduce time to develop a new piece of software by up-to 80%. Put another way, it can reduce the cost of software development by up-to 80%.
We have actually witnessed WEM save over 90% cost for a specific software development project.
It is these types of savings in both time and cost that are going to enable SME’s make the leap into true digitalisation.