How SMEs can Build Resilience from Disruption

Doing business in Africa for SMEs in  is becoming harder than before as the various governments offer little support or protection, globalization bringing competitors to our doorstep, rapid change in technology among many other reasons. It is a fact that technology is playing a big factor in disrupting many business sectors. Companies such as Safaricom disrupting Kenya’s financial sector, Uber disrupting traditional transport business models are just a few examples. Many entrepreneurs and SME in Africa lack the right skills and operating structure to adapt to the fluid business environment.

To build resilience against disruption, SME will have to inculcate Information Technology not as department or project but as part of its strategic plan and adopt a digital business model. The digital model encompasses; empowerment, collaboration, data, experimentation and speed.

African SMEs must shift from the traditional functional or departmental organizational structure and adopt a matrix structure that is highly adapted to meeting the specific needs of specific customer segments.

This requires SME to develop highly empowered teams having customer impact as a key performance indicator.

Further SME will have to build real time business support system to support decision making and allow for the team to take risk, experiment and adapt to the local business environment. This ensures they build and maintain a competitive advantage.

To put it into context; an SME can organize itself into business units for different geographies. The geographic business units are responsible for hiring the right people suited for the local market, selling products, acquiring new and maintaining customers.  The whole idea is based on the premise that decentralized businesses units are better placed to know the specific needs of a given local market, better promote the company products cognizant of local community preference and taste, and serve as community leaders.

To support such a decentralized, empowered organization, the company can for example build a real-time, mobile-enabled information platform that performs normal operations such as recruitment, customer care among others while at the same time getting and monitoring key performance indicators such as customer growth and satisfaction. So while the teams are empowered, they are still accountable.

To promote innovation and local service, an SME hires people with entrepreneurial backgrounds and gives them freedom to design promotions, sales programs, and marketing events however they like. The teams can then share information widely through the company’s internal communication network.

Corporate functions will then operate like shared services to provide scalable programs, but people do what they need to succeed. Whenever a business unit requires assistance in recruiting, customer service, marketing, training, or other areas, the company restructures its local organization to provide support. Goals and metrics are local and shared, so people are incentivized to work together toward the company’s overall objectives.

Finally for this to work, SME must inculcate a supportive Culture. Success is largely dependent on people sharing information with each other, partnering, and continuously educating themselves. This is able to happen when you build a collective, transparent, and deeply shared culture.