Many Small And Medium-Sized Enterprises (SMEs) are suspending their digitalization plans due to financial constraints, according to a recent World Economic Forum (WEF) report.
In a survey of 141 SMEs from six countries, only 23% of SMEs reached their digitalization goals during the pandemic.
WEF said that these figures indicate that there are still “significant barriers” to the adoption of digital technology in businesses.
The paper added that the pandemic “forced companies to divert funds to other areas such as health and safety, and employment protection.” Most SMEs also struggle to find financial assistance as banks prefer to give loans to large corporations.
Another challenge is the lack of skilled labor force and infrastructure needed to support digital transformation.
WEF stated that developing an “effective ecosystem for SMEs” could boost their digital technology adoption. This requires key stakeholders — such as industry, government, NGOs, and academia — to cooperate to help the technological development of these companies.
The WEF report also showed that there is a heightened demand among SMEs to integrate digital technology in business operations, particularly the industrial internet of things (IIoT), cloud computing, big data, and artificial intelligence.