According to a report commissioned by Cisco Systems, 19 million European small and medium-sized enterprises (SMEs) increasingly believe that the way to beat the competition is to use technologies designed to strengthen the company’s operations and health. The research was conducted by the independent research institute Coleman Parkes.
According to research conducted in twelve countries, more than half of SMEs believe that competition is the primary challenge and catalyst for investment in advanced technological solutions. It was recognized that over the next three years, the following will be essential for business operations: high-speed broadband Internet access, security systems, mobile and wireless solutions, and IP telephony. It is also believed that over the next year, technologies such as video conferencing (16 percent) or „smartphones” (20 percent) will be well-received, although an increase in demand for them is expected only within the next three years.
The demand for broadband services is well illustrated by the fact that over 80 percent of companies (15 million) recognize the need to have a high-speed Internet connection now and over the next three years. In the new EU countries, this figure is 94 percent.
As with larger enterprises, technologies that increase the productivity of mobile workers are increasingly desirable for 60 percent of European companies; this view is shared by as many as 70 percent of Italian companies and 77 percent of Danish ones, with remote access to the company’s own network cited as an example of essential technology. Representatives of small and medium-sized enterprises are also aware that a company successfully operating in the market must be a secure company – more than three-quarters of them emphasize the importance of network security as a factor essential for success.
Research conducted by the independent research institute Coleman Parkes also revealed that one-quarter of European SMEs already fully appreciate the importance of IP telephony and showed an average level of awareness in this regard among 37 percent of respondents. Interestingly, in the new EU countries, knowledge of Internet telephony is greater than in Northern and Western Europe. In terms of actual demand, this technology is prepared for significant expansion, and it is predicted that within three years, the share of companies understanding its importance will increase from 23 percent (4.5 million) to 35 percent (6.5 million).
– The cited results prove that small and medium-sized companies operating in both developed and emerging European markets are constantly looking for technologies that allow them to stay ahead of the competition, which is a measure of success for them – said Edward Overbeek, Vice President of Enterprise, responsible for European markets at Cisco Systems. – Although the market of 19 million enterprises shows great interest in technology, demand will only really increase when they see the benefits of increased productivity, protection of company assets, reduced operating costs, and improved customer service.
Although it seems that SMEs have appreciated the competitiveness-enhancing benefits of implementing new technology – the report also contains some worrying statistics regarding data storage and disaster recovery. In most enterprises, there is an awareness of the need for data archiving and storage, but in more than a quarter of them (5.3 million), the importance of this issue is not recognized, leaving these companies to fend for themselves, exposing them to the risk of irreversible losses caused by security breaches or system failures.
Other results are as follows:
Almost half (46 percent) of European SMEs stated that their main challenge is constantly keeping up with market problems and development.
Meeting the rigors defined in laws and regulations remains a problem for European companies – 41 percent of SMEs stated that this is a key challenge for them.
More than three-quarters of companies finance IT investments by paying cash. Leasing, at 31 percent, takes second place on the list of the most popular financing methods in all regions. Loans were used in only five percent of cases.
47 percent of SMEs from Northern Europe believe that difficulties related to implementation are a barrier hindering the use of new technologies in business. This view is shared by only 23 percent of the newly admitted EU countries and 36 percent of Western European countries.
72 percent of small and medium-sized enterprises (82 percent in Northern Europe) admit that some products aimed at the market are too complicated.
Overbeek added that – Overcoming such barriers related to technology implementation in companies belonging to the large and diverse SME market, such as costs or complexity, is a constant practice of Cisco, which makes efforts to provide solutions tailored to individual user needs, affordable and intuitive. Proof of this approach is the introduction last month of the Cisco Business Communications Solution system, consisting of a package of intelligent, uncomplicated, and secure products as well as financial services and technical support.
Research methodology
The survey conducted by the Coleman Parkes research institute involved 1,204 small and medium-sized enterprises. The respondents were usually owner-managers of small companies employing from 20 to 249 employees. The study included companies from: Great Britain, France, Germany, Italy, the Netherlands, Spain, Poland, Hungary, the Czech Republic, Denmark, Finland, and Sweden. The survey covered all sectors of small and medium-sized enterprises, including business services, administration, retail and wholesale, public utilities and telecommunications, as well as manufacturing and finance. Data was collected in September 2005.