“My business is small – so why should I worry about simplifying my business?” I hear this often from executives at small and even midsize companies. Most are focused on growth, growth, growth – as they should be, especially as competition intensifies. But many growing businesses eventually hit a wall of operational constraints that limit their ability to deliver goods and services, or branch out into new markets. They simply can’t grow anymore because their business is running on a patchwork of cobbled-together processes, organizational structures, and IT systems that can’t scale and adapt.
We spoke to the CEO of a SME organisation today in London, who highlighted that: A key weakness of official SME definitions is that they typically encompass the vast majority of businesses in each jurisdiction, which can make targeting and assessing SME policies difficult. Government policies and regulations are not always built with the small business in mind and the competitive advantages of larger rivals can be formidable. But often it is not just the external environment that is ill-suited to small business success; the business’s internal resources can be misaligned as well. Of these, perhaps the most important is the owner-managers themselves. Entrepreneurs are not necessarily more skilled than the rest of the population. Although more educated people are more likely to want to become entrepreneurs, they are actually less likely to act on this partiality between SME and their large rivals. In summary: it is a combination of competition, process complexity, lack of information flow, lack of govt support etc, which increases cost, reduces revenue, hence reduces profit.
Sound familiar?
It’s easy to think that business simplification is something for us to worry about after our business gets big enough to be complicated. Big companies are notoriously bogged down with overly cumbersome processes and locked into fragmented legacy systems and inflexible network architectures.
But there’s never been a better time for leaders of SMEs to think about business simplification. Let’s run simple, and we can avoid this costly, frustrating scenario entirely – and keep the doors of innovation and growth open now and in the future.
Let’s chart a Better Path to Sustainable Growth by Running Simple 
From an IT perspective, this means saying goodbye to deploying stand-alone apps and patching our infrastructure here and there to meet immediate needs. Because over time, it will become overly complex, rigid, and less effective. And it means building a flexible, scalable operational platform that can deliver on our corporate growth strategy.
With the right platform, we can pursue growth while remaining resilient, adapting to market changes swiftly. So as our business grows – and we need to outsource non-core operations, support new business models, sell across multiple channels, and go global (with all of the regulatory, linguistic, currency and other complications that brings) – we can do so with ease. That’s the power of running simple.
And according to a Knowledge@Wharton paper, the benefits of business simplification are huge: better customer experiences and retention, higher profits, lower costs, greater employee engagement and retention, increased operational efficiency…the list goes on. They can also react faster to market changes and customer needs, lighten employee workloads, and accelerate time-to-innovation and time-to-market.
SAP solutions for SMEs make it easy for you to run simple. Easy to install and use, they are tailored to our specific business needs so they’ll work for us now – and as we grow.
Check out our solutions at sap.com/sme. And to learn more about simplification as a business enabler, check out the complete Knowledge@Wharton paper here.
