Best Practices for SMEs in a Digital Economy

I was honoured to be a guest on a Tweetchat in which I was asked to speak on the topic, “Best practices for SMEs in a Digital Economy”. Find below my full notes from the questions asked and answers I gave during the chat.

1. In simple terms, what is a digital economy?

A digital economy is a theoretical situation in which all business transactions of a nation are done digitally. It is an economy which functions primarily by means of digital technology, especially electronic transactions made using the Internet. It is mostly also referred to as the web economy or the internet economy.

2. What really is the importance of a Digital Economy?

The quality and standard of our lives have been ever changing from the stone age till this very moment. And every change has been a step towards making life easier for the average man. Digital is the next stage of that progress. Take a closer look. Many of the conveniences we enjoy today are as a result of digital technology. ATMs, Cable TV, Mobile phones, GPS, fast charging etc. The benefits are endless. So really, the importance of a digitalized economy  cannot be overemphasized because it is the basis for every advancement in today’s world and in the future.

digital economy best practices

3. Can you talk on best practices for SMEs in a digital Economy?

I will be very specific to Nigeria. A lot of digitally driven businesses use buzz words that bamboozle the average business owner. They hype these things beyond recognition and make it seem like a major feat to achieve. Buzz words like My advice to SMEs will start from asking them to look beyond hype and start seeking to create value. So here are what I think are best practices for SMEs in Nigeria to operate digitally.

i. A website: This is overrated right? Until you discover that most businesses would rather have a hippy and ‘flying cars” website than one with simple features and loads fast with the crappy state of our internet facilities. Again, remove the hype and need to impress and make it user friendly. Enough for your target audience to use without getting lost or getting infuriated. Also remember to make it mobile friendly for obvious reason.

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ii. Use Content. A lot of it: Because no one ever hates great content, use content as a currency to get loyal customers in return. LIB fans will swear by her everyday, because she feeds them with the content they want to consume. The trick to using content to retain and find new customers is first knowing what your typical wants or like.

iii. Making Data Driven Decisions: There is no point winking in the dark or plunging into activities that you do not have sufficient data on. You want to introduce a new product? Try dogfooding the idea, you want to start a new service, if it has been done, research on your predecessors, if not dogfooding it is.

iv. Don’t ignore your competitors: Don’t ignore social selling either.

V. Make it easy for people to find you: Use online listings, add your brand to Google MyBusiness, setup a Facebook business page, map your business, put up directions to get to your physical store if you have one. Put up simple guides for people looking to order your product or service. Because at the end of the day, convenience and ease of use always wins.

4. What relationships exist between digital economy, SMEs and jobs?

Again, I will be Nigeria specific, there is an ongoing paradigm shift in what the typical business should be or what the typical job should be. The number of startup and business ideas that came to life in the last 5 years with the use of Digital technologies has seen both geometrical and socio-cultural progression. More jobs have been created, more skills are being impacted or learned, the perspective is changing.

Some companies are embracing remote working, some are embracing co working spaces, some are utilizing ride sharing services to cut costs. In all, we are seeing that more SMEs are springing up, creating job opportunities and innovating ways to stay afloat with the use of digital technologies or services. The more of these digital tools we use, the more the possible solutions we can create. This will in turn create more jobs. And the cycle continues.

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5. How can SMEs in Nigeria fully harness the benefits of being in a Digital Economy?

A “people first” approach to business is the key to success in today’s digital economy. SMEs should not just brush over the use of Digital and relegate it to social media alone. When companies equip their employees, partners and consumers with new skills, they can capitalize on the disruptive effects of technological advancement. 

Companies that embrace digital can empower their workforce to continuously learn new skills to do more with technology and generate bigger and better business results. Here are a few things I think SMEs can do to fully harness the benefits of being in a digital economy:     .

i. Intelligent automation: Intelligently automating some tasks like form responses, re-targeting your existing customers, welcome email to new signups, collating new leads from social or from your website, running ads to reach new customers, using a mobile responsive site, implementing simple e-payment tools, can help an SME gain new grounds doing business digitally. Bear in mind that your needs for intelligent automation may differ based on the industry of business. If churches can use POS to collect offering, what is your excuse?

ii. Liquid workforce: Technology can enable workforce transformation, leading companies to create adaptable and change-ready environments able to meet dynamic digital demands. Times are changing.. If 80% of your staff can work remotely, by all means let them work remotely.  This keeps your running cost low and help you negotiate a fair wage that keeps you and the staff contented.

iii. Platform economy: Platform-based business models can capture new growth opportunities. Uber recorded success in other part of the world, broke into our market and disrupted the taxi service in Nigeria and even forced the regular drivers to learn how to use apps and GPS systems. IMO, if we have more platform based businesses, the more job opportunities it will create for small business owners to key into.

iv. Digital Trust: To gain the trust of individuals, ecosystems and regulators in this new landscape, businesses whether small or large must focus on digital ethics as a core strategy. Not as an add-on. i.e Businesses must kick off operations with plans to perform tasks digitally.

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For instance, I work with Mobility Arena. It was designed from the start to run primarily digital. We only offered brick and mortar services as a means capturing other segments of our target customers.

6. What does it cost to help newbie SMEs operate maximally in a Digital Economy?

Costs will vary from one SME to another depending on a number of variables. Those variables include: size of operations, specific industry, scope of products and services. But whatever the level, it is a proven fact that SMEs that embrace and execute digital properly are able to lower operating costs, increase their reach and deliver services more efficiently.

7. Would traditional media still play any serious role in a digital economy?

Of course, traditional media will. Again, this will be to varying levels. Even in the most advanced economies of the world, traditional media is still present and active. The question is that of scope. The more digital an economy is, the smaller the role that traditional media will play. Eventually, the day may come when we see 100% digital economies.

8. What role can Digital Skills play to deepen and create a more inclusive economy?

According to the UN, many groups are still excluded from development because of their gender, ethnicity, age, sexual orientation, disability or poverty. The lower costs associated with digital, and the ubiquity of mobile phones in particular, makes digital perhaps the most effective tool for building an inclusive economy.

Digital media bridges lots of gaps in society. It makes access to information easier. It wipes out geographical barriers. For the first time, poor and rich people are able to interact freely (social media) and discuss issues from their various points of view. No other media has shown this much potential for inclusive development.

That pretty sums up my two cents. Feel free to drop your comments and questions in the comment section. Cheers.

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