A new report from Aston University has highlighted opportunities for small and medium-sized enterprises (SMEs) and mid-sized companies to develop strategies and pathways to increase their future readiness.
The report defines future-readiness as ‘a set of capabilities and orientations that enable companies to thrive in the future.’ For SMEs and mid-sized businesses to be future-ready, they must be successful on the three pillars of long-term growth, societal impact, and adaptive capacity.
Experts say they must be able to generate lasting financial strength driven by innovative business models, products, and/or services, to affect society positively in line with environmental, social, and governance (ESG) goals and to develop high levels of resilience and agility, which enables them to bounce back in difficult times and to identify and seize opportunities as they emerge, creating disruption in business models for the future.
The report aims to support leadership teams and the wider ecosystem in understanding how they can help increase the capacity for smaller companies to thrive and positively impact the economy and environment, as well as aid the recovery from the pandemic.
Experts also say that circular economy adoption, where the ‘make, use and throw away’ supply chain is converted to ‘take, make, distribute, use and recycle’, in SMEs and mid-sized companies create a win-win situation for every supply chain stakeholder through sustainability measures to achieve economic, environment and social performance.
The World Economic Forum will use the insights generated in this report to further support SMEs and mid-sized companies in their future readiness journey. This will be done through the creation of additional resources, including the continuous development of the Forum’s self-assessment and benchmarking tool on future-readiness, the creation of a platform for informal peer-to-peer learning between companies, and meet-ups with key experts.
Prasanta Kumar Dey, Professor in Operations and Information Management at Aston Business School and lead author of the report said, “the post-COVID-19 era is significantly more challenging than most people had initially hoped. Heightened geopolitical tensions, the energy crisis, supply chain disruptions, hyperinflation, and extreme weather events are just a few of the difficulties that will make the next decade a demanding one.
“SMEs and mid-sized companies’ leadership should try to focus on bridging their resilience gap and exploiting their high level of agility, afforded by their smaller size, as a competitive advantage.
“Future readiness capability building should not be developed as ad-hoc initiatives but should be embedded into key corporate strategies and decision-making processes, ideally from the beginning, so that it becomes part of the fundamental building blocks of the company.
“While smaller companies can go a long way in building their future-readiness, it is important to recognise the direct and important impact that their wider policy environment has on their ability to thrive. It is therefore crucial for policymakers, investors, and other stakeholders to do what is in their capabilities to contribute to building the future readiness of this segment of the economy.
“One of the high-impact areas of intervention at the system levels revolves around digital trade and includes implementing targeted measures to harmonise and drive trade data interoperability across borders and supply chains. This would greatly contribute to making it easier for smaller companies to trade internationally.”