What are the challenges for SMEs

These are the four biggest challenges for European SMEs

Medium-sized companies are the backbone of the European economy: They represent 99 percent of companies in the EU, have created 85 percent of all new jobs in the past five years and represent two thirds of all jobs in the private sector.

At the same time, SMEs are struggling with numerous challenges, as Susanne Durst, Full Professor of Business Administration at the University of Skövde (Sweden) explains at the Take Conference in Vienna: Specifically, this involves a shortage of skilled workers, digitization, sustainability / climate protection and the issue of corporate succession .

Skills shortage and digitization in SMEs

Regarding the skills shortage, Durst argues that 94 percent of SMEs in the UK struggle to find suitable staff. The shortage of skilled workers costs the local SMEs an additional 5.5 billion pounds (around 6.3 billion euros) per year because, for example, they have to invest more in recruiting or hire temporary workers.

+++ Data on SMEs and Artificial Intelligence in Austria are still low +++

The topic of the shortage of skilled workers flows smoothly into the challenges of digitizing companies. This is because business processes and business communication are digitized - which in turn requires appropriate skills. In a European comparison, the knowledge here is much more pronounced than in Romania and Bulgaria, which are bottom of the EU. Austria is in the upper midfield.

In almost every area of ​​digitization, SMEs in the EU do worse than large companies: While 94 percent of large companies in the EU28 have their own website, this applies to only 77 percent of SMEs. Around 90 percent of large companies have access to IT specialists, compared to only 65 percent for SMEs. And the possibilities of eCommerce in the B2C area are only used by eight percent of European SMEs.

At the same time, the risk of cyber attacks for SMEs is growing: in Great Britain, according to a study by the University of Portsmouth, 42 percent of SMEs report having experienced cyber attacks or IT security gaps within the past 12 months. Of the 42 percent mentioned, 36 percent had to introduce new measures and 31 percent had to hire new employees to close the security gaps.

Sustainability and Succession

SMEs in the European Union are also concerned with the issue of sustainability. You have to ask yourself how you measure such measures and react to corresponding inquiries from customers. Here, too, skilled workers with the right expertise must be found, and the company's communication must also be optimized with regard to the topic.

And then there is the issue of corporate succession. The international expert names Austria as one of the examples of the problem: It is expected that 27 percent of Austrian SMEs in industry will have to hand over their company to successors by 2023. Here the founders and current managing directors have to transfer their knowledge and contacts to the next generation.

According to a study by the Johannes Kepler University Linz, the problem is that five years after completing their studies, only six percent want to work in a small company and only ten percent in a medium-sized company. The majority (17 percent) would like to work in a large company or start their own company (23 percent).

In an interview with the brutkasten, the expert explains how targeted knowledge management can help meet most of these challenges.

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SME Roadshow Austria

The brutkasten has taken on these issues and supports the local SMEs in their tasks. At the end of August 2019, brutkasten started an Austria-wide roadshow with the aim of networking SMEs, startups and corporates. The focus is on the exchange of experiences, the presentation of regional best practice examples and the highlighting of opportunities for digitization, as well as cooperation with other companies. The SME roadshow is being implemented with the kind support of Austria Wirtschaftsservice (aws), Erste Bank and Sparkasse, Wiener Städtische Versicherung, A1 as well as Presono and SVEA Ekonomi and regional partners.