More Interconnected Business Fuels Cautious 2021 Optimism For Small And Midsize Organizations


In 2020, midsize organizations have been through an experience that has required great stamina, agility, and bravery.

Organizations that managed to strengthen their digital capacity are ready to take on whatever is thrown at them, good or bad. We’ve all been through a forest fire — but it means that the survivors have more room to grow.

The good news is that everything went digital and cloud, helping create a more level playing field between larger and smaller organizations—and allowing smaller organizations to take their natural strengths to new levels, if they can seize the new opportunities.

2020 was all about trend acceleration — the speeding up of things that were already happening, but cramming 10 years’ worth of change into six months. And as the start of 2021 has already shown, it’s far from over yet. There will be more changes to come, and responding dynamically to these challenges will require a more holistic, interconnected approach.

Research data from Oxford Economics shows that respondents from midsize organizations have been confident about their ability to respond quickly throughout the pandemic, adapting to remote working and new supply chains, and even new products and services. It has been inspirational to see these organizations’ intense focus on the changing customer and employee experience pay off, meeting new demands that nobody would have dreamed of a year ago.

The personal relationships and the concern for employees under the tough circumstances, and the unwavering focus on the human aspects of business are clear in the research, and it’s something that has helped companies survive as we all look forward to better days.

The research also shows that to succeed in the decade to come, midsize organizations need more systems thinking: ways of management that understand that every function has to be sharing data and sharing processes, and working together as one — not just in your organization, but also in the greater ecosystem of customers and partners. This is important so that you can move quickly as circumstances change and thrive in the future.

Today, nearly 29% of midsize businesses cite a lack of coordination between different departments as a top internal challenge, and 44% cite effective collaboration across functions as a major barrier to transformation initiatives.

Fixing the problem can be broken down into three main areas:

  1. Business processes
  2. Data analytics
  3. Talent and workforce strategies

Organizations need to make sure they’re working towards integrated, end-to-end processes across the business, ensuring that data is shared widely, and getting a complete view of the workforce, with the skills they need to be able to respond quickly to changing needs

While midsize organizations have made progress in each of these areas over the past year, the research shows that there’s still lots of opportunity for incremental improvement.

The first step to becoming more interconnected is to realize that smaller organizations already have an inherent advantage. It’s in your DNA: you have closer relationships with your clients and customers, and your CEO may even know the name of everybody in the organization. That’s powerful in terms of employee and customers experience, and results in a huge business advantage. The trick is to leverage those inherent advantages of size — the ability to move fast, the ability to work together—and take them to the digital realm, by applying the technologies that you need to make them scalable, and to extend the benefits to your now highly-distributed workforce.


Data analytics is a big part of this, and it’s an area where are lot of the organizations surveyed, of all sizes, could use some improvement. Just 39% of midsize businesses said they had all the data they needed to support analytics-based decision making. And the opportunities are even bigger when it comes to particular areas such as external data sharing with partners.

To be a digital business, you need a hub, something like an integrated ERP system, and there are lots of new advantages coming through technologies such as artificial intelligence. This fundamental technology enables everything from greater ERP efficiencies through robotic process automation to customer-service chatbots. It may seem to be a challenge for a lot of companies in this segment, as you’re trying to compete against larger companies who probably have more money to spend on this. But thanks to integrated AI, cloud-based services and on-tap expertise, you can be on the right side of digital divide and get the technologies you need to compete and thrive.

People and relationships

Technology is never enough on its own. It’s important that midsize organizations maintain their natural advantages, by avoiding organizational silos, avoiding breakdowns in communications or information, and ensuring that the whole company can respond holistically to the challenges ahead to be as effective as possible.

And this year has shown again the importance of relationships outside the business, working with core suppliers to share the same information that you have inside the business — where appropriate — to make sure you’re all running to the same strategy, and understanding the risks ahead, is going to be important.

Finally, the research reemphasizes the importance of people. This is a moment to focus on leveling up your workforce, making sure that people have the skills, the career path, the tools they need to do the work you need them to do and to stick around and do it for you! Investment in people and skills dipped over the past year — for valid reasons: after all, when your car is in a skid, you first focus on the skid. But now it’s time to focus on the road ahead for your people as you move forward.

One thing that jumped out of the data was that it’s important to give people a greater purpose as part of your business. Leading midsize organizations tended to have corporate purpose programs that weren’t just about feel-good volunteer work, but were solidly anchored in the business itself, deeply related to what people were already doing as part of their daily tasks.

The leaders of midsize organizations need to give people a sense that money isn’t only reason they come to work in the morning, to make sure they understand how they fit into the bigger, interconnected picture. If you’re touching every part of that worker experience including the part that goes beyond the paycheck, to doing something good, then you really have given yourself an opportunity to succeed.


In summary, in 2021, leaders in interconnected business will reap the rewards, with superior employee engagement and retention, increased innovation, and profitability growth—all essential factors for finding new ways of working and enabling future success.

For more information about how to achieve these goals, please consult the Oxford Economics report, “The Interconnected Business: How midsize businesses achieve value through holistic management strategies.”

Timo Elliott is vice president and global innovation evangelist at SAP
This article was orginally featured on Forbes: SAP Brandvoice.