Written by K. Raman, Managing Director Microsoft Malaysia

SMBs are the growth engine of Asia, making up the majority¹ of the region’s enterprises and employing over half of the workforce. In Malaysia, SMEs and SMBs comprise nearly 99% of the economy. They are responsible for 38.3% of the country’s GDP, 66% of employment and about 17.3% of exports. As companies strive to attract the brightest talent in an increasingly competitive business environment, SMBs must become ever-more innovative and agile.

There is much talk about big data, cloud and AI propelling industries forward, yet a vital and oft-neglected conversation revolves around the tools employees use to achieve their best work performance.

New generation, new tech demands

This year, an estimated 35%² of the global workforce will consist of millennials, a statistic that is expected to only increase. This new generation of workers³ value the opportunity of flexibility and their affinity for technology is driving them to demand greater mobility and technology in their work.

A recent study by IDC⁴ describes the “Future SMB” as an ecosystem and technology-first organization that can amplify its presence and capabilities for sustainable business growth, productivity, and competitiveness. Due to their small size, SMBs tend of face challenges such as skills shortage, low technology adoption and process automation. However, the study found that thanks to the proliferation of accessible digital technology, SMBs are closing the gap with MNCs⁵.

Closer to home, a Microsoft and IDC study in Malaysia which surveyed 100 business leaders and 100 workers found that Artificial Intelligence (AI) will double the rate of innovation and increase employee productivity by 60% in 2021. These benefits can be reaped by all organizations, including SMBs.

Hence, SMBs in Malaysia must be ambitious and adopt a digital-first mindset and business plan. With Digital Transformation set to contribute US$10 Billion to Malaysia’s GDP by 2021, the government’s move to enhance the nation’s digital infrastructure is undoubtedly a step forward towards a stronger, more resilient economy. These efforts will help cement Malaysia’s position as a tech powerhouse in the region, drawing in more investments from foreign companies whilst also creating more job opportunities for Malaysians. It is crucial that the nation focus its resources to develop an IT framework that expedites business development and increases workforce efficiency to successfully attract and retain talent.

Microsoft and TechAisle’s more recent research identified several gaps that are hindering progress. Firstly, the majority of SMBs are not upgrading their computing systems nor strategic IT applications such as cloud and mobility fast enough. This has created a rift between the technological expectations of the workforce – increased mobility, productivity and enhanced security – and the adoption rate of technology within businesses. More importantly, older computing systems and devices are prone to security risks. The opportunity cost of this is steep; an estimated 157 productive hours are lost due to old systems and devices. Cost of repairs alone can amount to USD$2657.

The increase in cybersecurity investment by companies in recent times demonstrates how cybersecurity is being  prioritized by SMBs’ during their digital transformation journey, as having the right IT infrastructure in place is critical to meeting the evolving needs of Malaysian SMBs and ensure long term business success.

SMBs must prioritize investing in the workforce’s demands, starting with the very first device they present an employee. For instance, a PC more than 4 years old is 3.1 times more likely to require repairs than a newer device. These PCs are unable to provide mobility to the workforce because they are slow to start up, frequently experience application and disk drive crashes and deplete battery rapidly. Older PCs are also more susceptible to security threats – 62% of SMBs experienced a breach in the last year alone⁶.

Pivoting towards greater technological adoption

Upgrading to newer technological infrastructure is simpler than it is made out to be. To address concerns such as the fear of app compatibility with newer operating systems and budget constraints, SMBs can look at implementing tech solutions and offerings such as cloud and managed IT services, which feature security patches and regular operating system updates for optimized use.

Research has shown that cloud adoption has reached 50% within SMBs in Asia and is likely to double within the next one year⁷. And the benefits are real.

SMBs should also consider moving towards Windows 10, the most app-compatible version of Windows-to-date, allowing them to continue work as usual whilst modernizing their workplaces and future-proofing their technology decisions.

Change is the new norm. SMBs in Asia have to confront fast-changing realities brought on by globalization, digital disruption, and the intense competition for talent. At the end of the day, their employees are as good as their skills and experience, enhanced by the digital tools their companies can provide them. In the same vein, SMBs are only as successful as their employees enable them to be, so let’s gear everyone up for success.

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¹ Asia-Pacific Economic Corporation

² The Millennial Moment – In Charts

³ Are Smart Digital Enabled Workspaces the New Norm?

⁴ New IDC Future SMB Research Reveals 84% of Asia/Pacific* SMBs Need Digital Technologies to Transform Their Businesses while 42% of SMBs are Planning to Start Now

⁵ Microsoft-TechAisle Pan-Asia SMB PC Study

⁶ Microsoft-TechAisle Pan-Asia SMB PC Study

⁷ Microsoft-TechAisle Pan-Asia SMB PC Study

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