Understanding The Game-Changing Digital First Approach for Indian SMEs
In an insightful conversation with Sanket Atal, SVP & MD, Sites, Salesforce India, Faiz Askari of SMEStreet found some key points that are worth reading for every MSME.
In an insightful conversation with Sanket Atal, SVP & MD, Sites, Salesforce India, Faiz Askari of SMEStreet found some key points that are worth reading for every MSME. Here is an edited excerpt of the interview in which Sanket explained contemporary trends and why digital transformation is gaining importance among Indian MSMEs.
Faiz Askari: Can you please share your views on the current scenario of the MSME sector?
Sanket Atal: According to the latest Economic survey, India is the third largest startup ecosystem in the world. The Indian startup ecosystem also has the potential to be the engine of growth in the medium to long run, as per the survey. A record 44 Indian startups achieved unicorn status in 2021, taking the overall tally of startup unicorns in India to 83, with most in the services sector, the economic survey showed.
The past year has shown us that it has given small businesses owners and the startup ecosystem a chance to re-evaluate their business strategies. At this moment, SMB’s are uniquely positioned to reap benefits of the digital first consumers. With small businesses poised to digitally transform themselves, technology will remain at the core of every business operation and customer-centricity. Insights from the SMB trends report suggests that 71% of SMBs say they survived the pandemic through digitization.
Faiz Askari: Why do you think digital transformation is essential in today’s world? How are SMB leaders preparing for post-COVID-19 recovery and growth?
Sanket Atal: As advancements in digital technologies continue to become a part of our daily lives, business leaders across industries are finding unique ways to keep up with changing times and consumer demands. According to the Salesforce State of Connected Customer Report, consumers in India estimate 60% of their interactions with businesses to take place online. Additionally, 71% of Indians expect companies to accelerate digital initiatives.
Today, building a digital first business is a game-changer for SMB leaders. SMB leaders are not only leveraging digital transformation to streamline processes, increase production and expand distribution; they’re also leveraging technology to provide flexibility to their employees and improve the overall customer experience.
As the shift in strategies helped in increasing efficiency and catapulting their business revenues, SMBs now plan to implement these changes permanently and long term. According to the SMB Trends report, 55% of growing SMBs in India have accelerated the pace of technology investments over the previous year.
Faiz Askari: Can you highlight how Salesforce is helping MSME/ SMB in their digital transformation journey?
Sanket Atal: We’ve seen that the pandemic has furthered the rapid adoption of online technology in India. The growing demand for digital services by consumers in the post-COVID-19 era, has also resulted in the rise of a slew of startups in FinTech, EdTech, artificial intelligence, the Internet of Things, and cyber security.
In a digital-first world, companies must be equipped to cater to customer demands and enable their employees to be successful from anywhere. At Salesforce, we believe small businesses can leverage technology as a force multiplier to reach their full potential.
We recently debuted the Salesforce Startup Program in India, aiming to work with disruptive startups to ensure their venture is on the path to success and prosperity. The program is uniquely designed to provide startups with access to our world-leading technology, experts, ecosystems, investment opportunities as well as business mentorship to create real impact. With shared aspirations, common objectives, clearly defined expectations, complementary capabilities, and mutually aligned incentives, all parties can unlock significant value.
Faiz Askari: How is the SaaS model evolving among SMEs?
Sanket Atal: As efficiency and customer-centricity become priorities, businesses are rapidly digitising to stay ahead of the curve. This is driving up spending on cloud technologies, expected to reach $482 billion in 2022, with software as a service (SaaS) being the largest market segment.
SaaS solutions are most preferred by companies due to their reliability, accessibility and cost effectiveness of a subscription model. The centralized platform connects users across a company to a suite of services and companies can get applications up and running with minimal time wasted on cumbersome startup and maintenance processes.
In India, the growth of cloud software is also driving economic benefits. According to IDC, the demand for cloud services is set to grow 22%, from $2.6 billion in 2020 to $8.5 billion in 2026. Traditionally, SMEs operated with largely manual processes, outdated accounting software, and disconnected systems. However, the pandemic accelerated cloud adoption, as businesses work towards meeting the demand for additional capacities. The adoption of SaaS is no longer restricted to just large enterprises. We’ve seen an uptick in SMEs adopting digital practices to grow and expand their businesses.
Faiz Askari: What level of RoI can be expected for an SME on Tech based investments such as Salesforce?
Sanket Atal: Salesforce helps small and growing businesses keep up with their customer’s changing needs. On average, Salesforce Helps customers boost their sales by 34% and marketing effectiveness by 37%. The benefits of Salesforce for small businesses are beyond just making a sale. Intelligent marketing automation helps allocate resources to important tasks that add value, while a common platform for all the data helps to build strong relationships across all your channels, including social, Web, email, and customer call centers.
SMEs are considered as the important building blocks in the economic development of any nation. In India, SMEs contribute 29% to the overall GDP of the country and employ 40% of the workforce as well. The sector has also contributed immensely with respect to entrepreneurship development especially in semi-urban and rural areas of India. However, SMEs still struggle to compete with large and established corporations. The only way SME’s can differentiate themselves is by offering sustained and consistent customer service.