Cisco: digital could accelerate APAC economic recovery
In its latest report, Cisco details that the digitalisation of small and medium businesses (SMBs) in Asia Pacific (APAC) could add US$2.6trn to US$3.1trn to Asia Pacific GDP by 2024, as well as contribute to the region’s economic recovery following the outbreak of COVID-19.
According to the International Data Corporation (IDC), APAC could add between US$10.6trn and US$14.6trn to its GDP by 2024 with as much as 25% could be attributed to the digitalisation of SMBs.
Commissioned by Cisco the study revealed that more digitally mature SMBs receive twice as many benefits when it comes to revenue and productivity compared to those that are indifferent to digitalisation. In addition the study highlighted that 70% of SMBs in Asia Pacific are accelerating digitalisation of their businesses due to COVID-19, with 86% believing digitalisation will help develop resilience against crises such as COVID-19.
“SMBs suffered the hardest impact in the current crisis but are expected to bounce back the fastest. This is not just because most of them have had to rely on technology to continue to deliver to their customers but also because of their agility and adaptability to innovate. As the region starts to emerge from the pandemic, this trend will play a pivotal role in the economic recovery. Cisco is committed to work with SMBs to help them emerge stronger with the right digital solutions and strategy,” said Bidhan Roy, Managing Director, Small Business, Asia Pacific, Japan and China, Cisco.
Further results from the study showed that 15% of SMBs value cloud as a top technology investment priority in Asia Pacific, followed by security (12%) and the purchase or upgrade of IT infrastructure software (12%).
However, there are challenges. Respondents from the study also reported a shortage of digital skills and access to talent as a top challenge (17%), followed by the lack of necessary technologies to enable digital transformation (14%).
“SMBs have an unprecedented opportunity. However, for them to derive the greatest long-term value, all stakeholders need to come together to address the key issues faced by the industry. This includes government, educational institutions, large corporations, and industry bodies. No one entity can solve these alone. At Cisco, we are proud to be playing our part. From a talent perspective, the Cisco Networking Academy has trained over 2.5 million students across Asia Pacific, Japan and China in various ICT skills since its inception. On the technology front, we have launched a series of curated products and solutions specifically for the SMB sector under the Cisco Designed portfolio,” Bidhan added.
Despite the challenges, SMbs continue to process in their efforts to digitalise their operations. The study reported that 16% of SMBs in the region are at the advanced digital maturity (stages three and four), with just over half of SMBs in the second stage and 31% in stage one.
“Digitalization is no longer an option for SMBs – it's a matter of survival. COVID-19 has forced them to move to digital-first, becoming more dependent on technologies to ensure business continuity and resiliency. As SMBs rethink processes, operations, and customer engagements, they are looking at cloud services and cybersecurity first, but have also increased their focus on customer experience, video conferencing and AI/Analytics solutions. Given the rapidly changing market conditions and speed of technology evolution, SMBs should work with the right industry partners to ensure they can maximize their technology investments and thrive in their digitalization journeys,” said Daniel-Zoe Jimenez, AVP, Head Digital Transformation & SMB research at IDC.