SMEs’ 5 Biggest Challenges and How RepuX Can Help

As digital transformation reshapes industries and business models, small and medium-sized enterprises (SMEs) may encounter difficulty adapting to the new paradigms of the big data economy.

Already feeling the squeeze of diminishing working capital, with cash flows compressed by delayed B2B invoice payment cycles, SMEs are also seeing their borrowing costs rise as the Federal Reserve raises interest rates.

Beyond macro considerations, SMEs should also be aware that the recent repeal of net neutrality by the U.S. Federal Communications Commission could lead to data price gouging by their telecom and Internet service providers, which will further strain cash flows.

Other obstacles that SMEs must seek to overcome in 2018 include: The lack of integrated digital strategy; disconnection from the cloud; non-collaborative business models; ignorance of artificial intelligence (AI); and marketing.

But with RepuX, the world’s first decentralized marketplace for enterprise data, SMEs can overcome these hurdles and transform company data into a catalyst for smart, sustainable and synergistic growth.

Built on the Ethereum blockchain, RepuX leverages distributed ledger technology that enables SMEs to securely share and monetise their data with trusted parties. For example, using RepuX, SMEs can share their internal data and business intelligence with AI and machine learning developers, who can then create bespoke algorithms and applications engineered to the unique needs of the enterprise.

Alternately, SMEs can use RepuX to anonymously sell their data to ecosystem partners or analytics aggregators, creating transformative and urgently needed digital revenue streams. RepuX’s transparent reputation scoring oracle ensures a healthy, fair and compliant marketplace, where the Ethereum blockchain ledger enforces trust between otherwise trustless actors.

Now that we’ve established the use-case for RepuX, let’s dive deeper into the five biggest challenges SME operators face in 2018.

No Digital Strategy

Many SMEs naively assume that their core market will remain constant and that their business model will not be subject to change. But in the digital economy, an SME operator couldn’t make a more erroneous assumption.

Beyond operational and marketing considerations, SMEs need to assess the organisational change that needs to happen in order to facilitate digital transformation. The broader strategy should encompass the following:

• Where can you grow?
• What markets are under attack?
• What is the best defensive strategy to preserve market share?
• How can you monetise data?

By sharing and collaborating on RepuX’s platform, SMEs can develop better data-driven insights about their target markets and develop new data revenue streams from their anonymized internal business analytics.

The Cloud Disconnect

According to a 2016 European Journal of Economics and Business Studies article, most SMEs still rely on “CPU-heavy” systems, consisting of cumbersome computing hardware and expensive software applications. But cloud computing eliminates the need for these antiquated operating models. SMEs can deploy cloud computing solutions to maximize the value of big data analytics, without significant investments in technology and personnel.

To this end, a joint G20 German Presidency- OECD conference report found that “it is essential to foster use of more sophisticated digital technologies among SMEs, especially cloud computing, which allows smaller firms to overcome some of the barriers associated with the high-fixed costs” of information and communication technology (ICT) investment.

Non-Collaboration

The idea of collaborating and sharing data with ecosystem partners is still foreign to many large companies, and even more so for SMEs. But according to a 2017 Goldman Sachs report, looking outside the organization for opportunities to collaborate, might be one of the most valuable initiatives they can pursue.

The report found that sharing knowledge, aggregating resources, broadening networks and collaboratively innovating can significantly improve an SME’s growth prospects. A 2017 Accenture Report on Artificial Intelligence supports this view, as it revealed that collaborative businesses raised their enterprise value by 4.2 percent, or nearly twice the growth rate of non-collaborative entities, since 2013.

Ignoring AI

In 2018, no technologies have become more integral to digital transformation than AI and machine learning. Yet, many SMEs, “which tend to hold back in the face of new technologies,” according to the Financial Times, have neglected to embrace automation. This is a fatal mistake.

The three key advantages that AI offers to small businesses are the following: A lower-cost and more efficient way to capture data insights; predictive algorithms to predict market and consumer behavior; and customer personalization. In the age of hyper-consolidated multinational corporations, SMEs must learn to harness AI to remain competitive, if not operational.

Digital Marketing

Marketing is another operating weakness for SMEs that can be vastly improved by AI. Going back to the last point of customer personalization, predictive analytics can improve customer targeting, so that marketing becomes more efficient, strategic and productive.

According to an independent report by a British marketing agency, SMEs’ top-five digital marketing challenges, in descending order, include: Turning leads into customers; generating web traffic; finding time to engage resources for digital marketing; turning web traffic into leads’; and customer retention.

But by automating marketing with an AI solution, SMEs can completely eliminate their third biggest challenge, and create a data-driven framework to optimize the other four problems, from traffic and lead conversion, to maintaining their existing market share.

RepuX Can Help

As data becomes the center of the 21st Century economy, SMEs must embrace digital transformation and Fourth Industrial Revolution technologies. RepuX helps SMEs securely access mission-critical AI resources and insights through its decentralized marketplace bridging the disconnect between enterprises and machine learning innovators.