There’s no getting around digitisation these days. This megatrend has attracted the attention not just of large corporations but also of small and medium-sized enterprises (SMEs). The 2017 SME Review published by FHS St.Gallen, a university of applied sciences, investigates what Swiss SMEs understand digitisation to be and what challenges and opportunities they believe it presents. The study covered over 600 companies from a wide variety of industries and regions.
The study revealed that the term “digitisation” means different things to different people and organisations. Although there was no single definition, three-quarters of all surveyed companies reported pursuing a digital project (72%). Projects were most prevalent in the ICT industry (information and communication technology) and least prevalent in the hospitality sector. It thus comes as no surprise that the ICT industry views digitisation as more of an opportunity than a threat.
Perceived opportunities vary from industry to industry. Service companies see digitisation largely as an opportunity to boost efficiency; manufacturers and construction firms believe it can improve their productivity. Retailers and hospitality providers are more interested in accessing new distribution channels and attracting new customers.
However, digitisation poses challenges, too. For manufacturing businesses, the biggest challenge involves investments in employee training to equip their workers with necessary skills for the digital era. In the service industry, the core concern is data security; in retailing, it is fiercer price-based competition due to greater market transparency.
The study confirms what Michael Sonderegger, Head of Front Office Corporate Customers, has observed for himself. He knows that many companies believe digitisation presents tremendous opportunities to improve their efficiency as well as huge challenges in maintaining data security. “Our mission is to give our customers the best possible protection in the digital age,” explains Sonderegger. “That’s why we constantly adapt our insurance products to changing circumstances.” For example, digital risks have been added to all eight products in the updated Helvetia business insurance policy for SMEs. The technical insurance covers cyber-attacks, including additional costs and restoration expenses, while the assistance component covers credit card and mobile phone fraud.
According to Sonderegger, most corporate customers worry about data security. That’s why data security risks are being incorporated more thoroughly into the product development process. To start with, Helvetia launched a cyber insurance product in January 2018. This new insurance product covers a variety of risks relating to digital data and software, including data manipulation or corruption due to internal sabotage or the intentional installation of malware. “Cyber insurance is the right choice for any organisation that handles sensitive data and would be unable to conduct its regular day-to-day operations if it fell victim to a cyberattack,” explains Christoph Guntersweiler, Head of Technical Insurance. “However, we urge all organisations to address this issue in detail. Doing so will leave them better prepared for attacks by cyber criminals and better able to respond quickly and effectively to them.”
FHS St.Gallen has been publishing the SME Review since 2014. It addresses current issues relevant to small and medium-sized enterprises. Its main sponsors include Helvetia Switzerland, Raiffeisen Switzerland and BDO. This year, the study focused on digitisation. Over 600 companies from various industries were surveyed between January and April 2017. The results were interpreted by conducting expert interviews with representatives from trade and professional associations.