SME Technology Outlook: Future Challenges and Opportunities

With nearly half of 2022 behind us, the challenges for Small and Medium Enterprises (SMEs) remain significant. The Covid-19 pandemic is still with us, causing continued pressure on income and cash reserves, disruptions in the labor market, and disruptions in supply chains.

Energy prices, which have already risen due to strong demand as economies begin to emerge from the 2020/21 economic recession, have been pushed further by the war in Ukraine, driving up broad-based inflation.

These difficult times are not going away any time soon.

Macroeconomic trends

In December 2021, the OECD noted that “production rates in most OECD countries are now higher than they were at the end of 2019 to return to pre-pandemic levels. But weak economies, particularly those in countries with low vaccination rates, are You risk being left behind.”

Chart: OECD.

Inflation, which was supposed to peak at the end of 2021, is expected to rise by another 2.47% worldwide this year. This is due to the shock in the financial and commodity markets due to the Russian invasion of Ukraine. The impact on global GDP over the same period is expected to be 1.08%.

Small Business Health and Trust

How do these macro trends play out in small business?

In the United States, the health of small and medium businesses (i.e. businesses with fewer than 500 employees and not a sole proprietorship) is monitored quarterly by the American Chamber of Commerce/MetLife using the Small Business Index. Its latest score, based on a survey conducted between January 14 and 26 (that is, before Russia invaded Ukraine), was 64.1 – the highest level since January. The start of the pandemic.

American Chamber of Commerce / MetLife: Small Business Index

Chart: US Chamber of Commerce/MetLife.

Inflation has topped the challenges faced by small and medium businesses in recent quarters, followed by supply chain issues. Issues related to Covid-19 are also still relevant. Meanwhile, concerns about employee well-being and morale have risen steadily, while revenue has become less important as the US economy emerges from recession.

It will be interesting to see if the picture will change dramatically in the second quarter, when the impact of the war in Ukraine will be felt, and whether the 51% of American small business owners who in the first quarter believed the small business climate would return to normal within six Months to years have changed.

Challenges and priorities for SMEs in 2022

To get a sense of the specific concerns small businesses will face in 2022, we reviewed over two dozen surveys and forward-looking articles published over the past year and recorded references to different issues and areas. This is the resulting table:

Challenges and priorities for SMEs in 2022

Graphic: ZDNet.

The Five Key Issues – Digital Marketing and Customer Relationships; employee experience, training and welfare; digital transformation and new technologies; information technology and operations management; Telecommuting and hybrid work — they are all linked, to some extent, to the experience of the pandemic.

Digital Marketing and Customer Relations

During lockdown periods, the focus on attracting new customers and satisfying existing customers has inevitably shifted to online channels.

But it’s not enough to create a website with a workable e-commerce solution and then hope that customers will come: you have to work on SEO, attracting and converting new prospects through email and social media campaigns.

For this, companies are increasingly using videos and influencers of all kinds. Once customers are acquired, it is clearly necessary to have effective Customer Relationship Management (CRM) systems in place so that we can deliver a satisfying and loyal experience.

Employee experience, training and well-being

In the previous world (epidemic), we didn’t care much about employee experience. But two years of widespread changes in working conditions and practices have changed the game and highlighted concerns about burnout, workers’ mental health and work-life balance.

Today, employers not only need to rethink how they manage the workflow of employees and monitor their performance, but also how to communicate with them effectively. Thus finding new ways to train, train and guide them. Especially when they are at a distance.

A company that fails in this area will find it difficult to retain its employees. Small and medium businesses that do not have dedicated HR staff should pay special attention to this standard.

Digital transformation and new technologies

Digital transformation and the adoption of new technologies is an important focus for SMEs, as it can put them in a better position to weather tough economic conditions and gain an edge over their competitors.

Cloud-related technologies such as SaaS (Software as a Service) applications—particularly those targeting specific vertical markets—offer clear advantages in terms of turning CAPEX into OPEX, by outsourcing the deployment and maintenance of core technology.

This should enable companies to focus on adding value through the rapid development of customized products and services, and transform online experiences using new technologies such as augmented reality (AR), virtual reality (VR), machine learning (ML), and artificial intelligence (AI).

Information technology and operations management

Driving a company’s digital transformation is not just about embracing cutting-edge technology for new projects: it is often centered around the need to increase the efficiency of existing systems and processes, and that will continue to grow. It is a priority for small and medium businesses.

Knowing how to use siled data (both structured and unstructured) that is on your IT property can, for example, unlock business value.

Implementing solutions that make SMBs look like a large enterprise – adopting an interactive voice response system, for example – is also an important success factor, such as increasing automation, simplifying website development and maintenance, transitioning to e-commerce, and speeding up fulfillment and delivery. Perhaps less flashy than AR/VR and AI adoption, but just as important.

Remote work and hybrid work

One of the profound changes brought about by the Covid-19 pandemic is likely to be the permanent shift towards telecommuting and hybrid work, and the disappearance of the traditional office as the primary workplace for many employees.

Despite the expected resistance from more conservative circles, companies appear to be adjusting to shifting employee expectations brought about by the shutdowns in 2020 and 2021: many employees have proven they are able to work productively from their homes, or rarely go to the office. And they have no desire to return.

In the future, work is likely to fall on a continuum from fully telecommuting to fully in-office work to mixed work, with the balance dependent on the employee’s role, the industry in which their business operates, and personal choice. Small and medium businesses will need to make sure they have productivity, connectivity, and security technologies in place to serve remote workers and hybrid workers, as the demand for flexible working will not fade and latecomers will likely struggle to retain their staff and hire.

Other priorities

Not surprisingly among the other challenges and priorities listed above, though, inflation and supply chain concerns are likely to be stronger now than they were when the surveys and studies used to compile them were published (mainly prior to the conflict in Ukraine). It is also good to see that the heading “Sustainability, Resilience and Environment” appears in the middle of the table.

The state of information technology in 2022

To analyze the current state of the IT field, SpiceWorks Ziff Davis has released the 2022 edition of its annual report on the subject. Conducted in July 2021 among 1,145 IT buyers from organizations in North America (57%) and Europe (43%), it is clearly biased towards SMEs, with 35% of companies having 1-99 employees and 32% From 100 to 499 employees.

Before the war in Ukraine and the recent rise in inflation, there were “reasons for optimism, after the overall decline in technology spending growth in 2021,” the report said, while noting that “the Covid-19 pandemic will continue to unfold. A marked impact on the technology sector Information – either directly, through supply chain issues, or indirectly, through the legacy of increased security levels Flexibility to work remotely.

The planned challenges for 2022, broken down by company size, looked like this in July of last year:

Spiceworks Ziff Davis: Anticipated IT Challenges in 2022

Graphic: Spice Works Ziv Davis.

IT buyers, particularly in medium-sized companies (100-499 employees), were more concerned about limited product availability, shipping delays or logistical disruptions, supply chain issues, increased product costs and chip shortages. Provisioning and support for remote workers was at the bottom of the list (probably because these issues were largely resolved in 2020).


As economies began to recover from the recession due to the pandemic, the war in Ukraine and high inflation created new headwinds through which small and medium businesses had to navigate.

Indicators of health and confidence for SMEs in general increased between 2021 and the first quarter of 2022, but recent political and economic shocks may be about to dampen this optimism.

Key concerns for SMEs in 2021 and anticipation – before the war in Ukraine – for 2022 include digital marketing, CRM, employee relations, digital transformation, IT and operations management, as well as telecommuting and hybrid work.

At the same time, buyers of IT products are anticipating challenges related to product availability, shipping delays, supply chain issues, high product costs and chip shortages.


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