As the economic impact of the Covid-19 pandemic hits Africa’s business sector, small and medium enterprises are in a fight for their survival. With slowing economies across the continent, low consumer confidence and now a pandemic, SMEs are increasingly in search of tools that can help them build resilience against the ongoing disruption.

Pedro Guerreiro, Regional Director for Central Africa at SAP, says some businesses were fortunate enough to have the tools and systems in place to enable remote work. “This minimised the negative impact of the lockdown on their productivity and operations and enabled them to maintain business continuity more easily. However, some SMEs have out-of-date technology, while too many have not invested in technology at all. This leaves SMEs stranded and lacking the capacity to adapt to a very disruptive environment.”

According to the World Bank, SMEs account for about 90% of all businesses and more than half of all employment worldwide. However, African SMEs face perennial funding challenges, with the IFC estimating that Covid-19 will widen a funding gap that already sits at $1.5-trillion.

Cloud holds key to productivity
Guerreiro adds that SMEs that had adopted cloud services prior to the country lockdowns would have been in a better position to maintain business productivity and keep operations running. “If you are stuck with outdated on-premise technology, however, the lockdown restrictions would have been devastating to your productivity, especially as employees were suddenly working remotely and without physical access to the office.”

In South Africa, for example, which had one of the strictest lockdowns in the world, 70% of the country’s workforce has returned to work, but many companies are persisting with remote work. “There is growing evidence that employees can maintain the same – or even higher – levels of productivity when working remotely as they do when they are at the office. One of the key enablers of this is their use of technology tools such as cloud-based enterprise resource planning solutions that enable them to orchestrate their business productivity regardless of where they are.”

Young businesswomen texting on smartphone in the office.

Enterprise tools for SMEs

While ERP solutions were traditionally leveraged by large organisations that had the skills and capital to successfully implement them, technology vendors have made a concerted effort over the past few years to extend these offerings to the SME market. “Nearly 80% of SAP’s customers globally are SMEs,” says Amin Meqdadi, Head of General Business for SAP Africa. “And with an implementation period of as little as two weeks, the solutions that are available to SMEs can transform how they operate quickly enough for it to matter as they recover from a tough trading period due to Covid-19.”

Meqdadi points to partners and resellers as key enablers of cloud adoption among SMEs. “A strong partner ecosystem can help SMEs navigate some of the trickier aspects of cloud adoption and help build innovations that are tailored to the SME market. The pandemic is also forcing some change in how partners and resellers engage with SMEs.”

Tech resellers are facing a step change in the market. “They have no choice but to expand their portfolio with what the SME market needs. “Since the Covid-19 outbreak, what SMEs need most is the agility, cost-savings and productivity benefits of cloud solutions. While adopting and implementing cloud was generally seen as a nice-to-have or a goal for some time in the future, the very survival of many SMEs now depends on how well they adopt and leverage the many benefits of cloud technologies.”

Meqdadi believes many resellers will need to reconsider their business models with urgency. “SMEs are looking for cost-efficient cloud solutions that can be implemented and deliver business results quickly. The growing adoption of born-in-the-cloud SME solutions such as SAP’s ByDesign and Business One also gives resellers access to a broader market, as these tools can be used by smaller businesses as well as more established enterprises.”

New breed of partner
Lillian Serobatse, Head of Channel for Africa at SAP, says the ongoing disruption has changed companies’ expectations of their technology partners. “The new currency is lifetime value, in other words, how can my partner provide ongoing value to my organisation and help me make decisions over my technology that support the achievement of my business goals. It’s not enough to just sell a product or solution: channel partners are now tasked with helping customers extract the maximum amount of value over time from their technology investments.”

Serobatse adds that these changing expectations have given rise to a new breed of partner organisation. “The best value-added resellers and tech partners today develop extensive industry-specific expertise, take the time to really understand customer pain points and opportunities, and then co-develop tailored solutions alongside the larger vendors. This gives them access to very specific markets where their solutions can make an immediate and long-term positive impact.”

Meqdadi believes the tools that SMEs need are already available to value-added resellers. “Many of these solutions arguably provide a panacea to the current challenges resellers and their customers face. Lightweight, native cloud applications such as SAP ByDesign answer a customers’ urgent need to support a remote workforce without compromising compliance. Technology partners who don’t have an effective answer to the SME market need to act speedily. Their survival, and the survival of many SMEs, depend on it.”

Visit the SAP News Center. Follow SAP on Twitter at @SAPNews.

Distributed by African Media Agency (AMA) on behalf of SAP Africa.

About SAP
SAP’s strategy is to help every business run as an intelligent enterprise. As the market leader in enterprise application software, we help companies of all sizes and in all industries run at their best: 77% of the world’s transaction revenue touches an SAP® system. Our machine learning, Internet of Things (IoT), and advanced analytics technologies help turn customers’ businesses into intelligent enterprises. SAP helps give people and organizations deep business insight and fosters collaboration that helps them stay ahead of their competition. We simplify technology for companies so they can consume our software the way they want – without disruption. Our end-to-end suite of applications and services enables business and public customers across 25 industries globally to operate profitably, adapt continuously, and make a difference. With a global network of customers, partners, employees, and thought leaders, SAP helps the world run better and improve people’s lives. For more information, visit www.sap.com.

# # #
Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to SAP are intended to identify such forward-looking statements. SAP undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect SAP’s future financial results are discussed more fully in SAP’s filings with the U.S. Securities and Exchange Commission (“SEC”), including SAP’s most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.
© 2020 SAP SE. All rights reserved.

SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP SE in Germany and other countries. Please see https://www.sap.com/copyright for additional trademark information and notices.