Where does the essential input required to start up a digital transformation process in SMEs come from? From the administrator? From the innovation manager? From the employees with most digital skills? According to the results of a Ricoh study, it is the customers who first and foremost determine the digital transformation of SMEs.

That is right: the initial mechanism of SME innovation would comprise their consumers. The study in question was carried out with a sample of managers from 3,300 companies, from 23 different companies including Italy, Norway, Portugal and South Africa.

Innovation in SMEs: when the spark comes from the customer
59% of the managers explained that innovation is an absolute priority. Despite this fact, it is not so much the management, but the customer who is defining the direction of corporate digital transformation More specifically, 91% of the managers interviewed stated that they had a project in store to align products and services with the customers’ explicit needs.

Customers, in fact, have several new needs that companies are acknowledging as essential leverage for change.
The following are essential for the interviewed managers:

  • quality/price ratio – 43%
  • variety of offer – 42%
  • customer experience quality – 41%

Customer expectations in these fields are rising rapidly, and it is the companies’ task to meet these needs by innovating quickly.

Innovate or fail
Faced with the customers’ decided needs and the ongoing digital transformation, SME innovation is no longer a simple competitive advantage. It is no longer a possibility: it is, instead an acute need, and managers are well aware of it. 59% of the managers interviewed stated that a company that does not choose the innovation route could close by 2020. More specifically, 34% of managers stated that without the due innovations, their own company wouldn’t be able to avoid failure by the end of 2020. The problem is that, although there is widespread awareness of the impact that the digital revolution is having in their own sector, 59% of companies has still not managed to exploit the benefits of digital transformation to the full. On this point, David Mills, CEO of Ricoh Europe, explained that:
SME managers have the task of traveling the path of growth and change in a highly complex, uncertain context. The positive side of this situation is that it can lead companies to reconsider the direction they have taken and help them to develop more effective ways to target the market.

Three areas of innovation for SMEs
Researchers at Ricoh have identified three key areas where Italian and European SMEs should make setting up innovation processes a priority, by applying new technologies. These are creating ever closer relations with customers, using CRM tools in an optimal manner, the need to make workplaces smarter and to provide employees with the best technologies, so that they can fully express their talent.