As the trend toward digitization continues to catch on with small and midsize businesses, experts come together at the SAP SME Summit 2015 in Frankfurt to discuss the digital transformation of the midmarket.
At its fifth annual SAP SME Summit, SAP once again showed the world it understands the needs and concerns of small and midsize enterprises (SMEs). Experts, journalists, and analysts from nine countries came together at this exclusive event at the Steigenburger Hotel in Frankfurt to discuss real business challenges of today’s midmarket, its digital transformation, and the support available from SAP to enhance SME businesses.
The event kicked off with a round table, where Stefan Höchbauer, President of the SAP Middle & Eastern Europe (MEE) region, and Sergey Fedorinov, Chief Executive Officer of Ulmart, Russia’s largest Internet retailer, jointly announced their collaboration on a trade platform based on SAP hybris components and SAP ERP.
Ulmart’s transition to SAP was driven by strategic decisions to develop the company further, and in particular by regional expansion plans. The IT platform has become one of the key competitive advantages of Ulmart and one of the key drivers of its development in this area. Ulmart plans to implement an e-commerce platform from SAP as well as SAP Business Warehouse (SAP BW) powered by SAP HANA to help it analyze its data more efficiently. In addition, it will soon draw on the services of SAP Contact Center (previously SAP Business Communications Management) to help its call center increase customer loyalty by forming a stronger, more personal connection with its customers.
Federivnov explains: “The main task for us was to use the call center to create an emotional communications channel with the consumer, which could inspire the consumer to contact us before they make their next purchase, since in Russia live communication is a very important factor when shopping for products. The call center allows us not only to provide 24/7 customer support but also to provide remote consultations, which helps the customer to choose goods and to leave feedback on the level of service and product quality.”
Hoechbauer confirmed the growing relevance of digital trade by citing some impressive statistics: Already, more than 3.1 billion people around the world use the Internet. What’s more, he said, in the e-commerce segment, the volume of online purchases is expected to increase to US $3.5 trillion by 2019.
Ilya Yuriev, responsible for SAP Global Partner Operations and Head of CIS Region, in turn presented some interesting facts about the digital revolution in Russia. E-commerce is one of the fastest growing segments of the Russian digital economy, and it in particular is able to help small and midsize businesses promote their goods and services and win over customers. The Internet and Runet (the Russian-language Internet) are what make this possible.
SAP is making a significant contribution to the Russian e-commerce market by providing its customers with innovative solutions ranging from the SAP for Retail industry solution portfolio to the SAP hybris solution for managing e-commerce and other business applications.
Panel Discussion: Digitization on the Rise for Smaller Firms
The subsequent panel discussion about the trend toward digitization in the midmarket also proved that SAP recognizes and understand its customers’ challenges. Höchbauer began by reporting on the feedback he receives from customers. The number one question customers asked themselves, he said, was “How do I stay relevant in my specific type of business as an SME? And only when they’ve addressed that problem, do they look at their business processes and their go-to-market strategies.”
The SMEs come in all shapes and sizes, he added: From e-commerce leader Ulmart to the small but exclusive Sansibar Restaurant on Sylt, which thanks to digitization now also sells its products through the Internet.
According to Höchbauer, hyper-connectivity and real-time digital information create new vast new opportunities, but also a new central challenge – complexity. Fortunately, SAP delivers a complete portfolio of SME solutions designed to support its customers and help them stay relevant, he noted.
John Higgins, director general of Digitaleurope, the association for the digital technology industry in Europe, provided a EU perspective on digital transformation for SMEs, looking at such issues as what are the legal frameworks in place and so on. After all, he pointed out, SMEs form the backbone of the European Union, accounting for almost 99 percent of all businesses. Promoting smaller firms and startups would therefore generate more jobs as well and support the European economy. A number of cities across Europe – such as the Irish capital Dublin – already serve as good examples of digital transformation. A recent study commissioned by the European Commission investigated the progress of digitization among European SMEs.
Joining the panel was Dr. Florian Kainzinger, former CEO of Labor Berlin, a fusion of the Charité Berlin hospital labs and the German health care group Vivantes. He reported on the successful digitization of Labor Berlin. Kainzinger was instrumental in driving that digitization, implementing SAP Business ByDesign and the SAP SuccessFactors HCM Suite in just six months. As a start-up consultant in the healthcare industry in Germany, Kainzinger firmly believes that digital transformation needs to happen top down. To succeed in your digitization project, you need digital management, he said, so it is important to win over your CEO or another executive board member as advocate.
Currently, two-thirds of all European employers are SMEs. Norbert Kunz, managing director of Social Impact, a stipend program for social enterprises in their start-up phase, therefore took a closer look at the job market. Most of the start-ups in Social Impact’s program are “digital natives,” whom Kunz sees as the nucleus of future market evolution. In his opinion, SMEs need a digital mindset built into their DNA. Given the increasing speed of change in our technological society – be it cloud, mobile, big or smart data, or business networks – it is extremely important that businesses keep up, he said. They should therefore adopt and maintain a certain start-up mentality in order to stay passionate about what they were doing.
Bert Schulze, SAP’s representative on the panel, pointed out that digitization is not just a matter for the midmarket. Digital capabilities are fundamentally changing every industry – from their external value chains to their internal processes. By 2018, he said, the number of smart wearable devices will have increased tenfold from the volume shipped today, providing new context for data. Meanwhile, companies such as Apple, BMW, Virgin Atlantic, and Nike have already begun transitioning from selling products to selling experiences – the modus operandi of the future. Automatization, however, should not be confused with digitization.
The midmarket is extremely significant for SAP, as more than 80 percent of these customers come from the SME segment, as do the majority of the company’s e-commerce. Together with more than 13,000 partners worldwide, SAP delivers a complete portfolio of SME solutions designed for the way customers do business – providing choice of solution, deployment, and licensing model. Simple, affordable solutions can be implemented quickly, enabling SMEs to realize a quick return on their investment. Today, democratized technology decreases the barriers to create new businesses, reduces the necessary capital investment, and allows smaller firms to compete with larger, more established companies.
In line with this approach, SAP recently launched the SAP Anywhere solution in mainland China. SAP Anywhere is the first front-office solution specifically tailored to the e-commerce needs of small and midsize businesses with 10 to 500 employees, offering SMEs the opportunity to monetize digital sales channels by giving them a full set of customer experience and commerce features.
Numerous 1:1 meetings with experts plus demo pods focusing on cloud solutions as well as SAP HANA solutions for the midmarket rounded out the fifth annual SAP SME Summit in Frankfurt. The SAP SME Summit for America, Canada, and Latin America is scheduled to take place on November 10 in New York.
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