Latin America. It's a great time to be a medium-sized company. The current disruption is about ideas, not about capital or building investments. While it's true that large companies have more resources, but with the right technology, small businesses can behave like large ones, maintaining the agility that makes them ideal for the digital age.
Here are five reasons why medium-sized businesses are ideal to be successful in the twenty-first century, and how technology gives them the functionalities they need.
Evolution of Barriers
For decades in manufacturing history, the beginning of a new operation meant buying, inheriting, or developing a factory, and then filling it with the right, generally expensive, machines and equipment. In the last decade, investment in robotics has become a necessity for automating processes and staying competitive. This has changed a lot and very quickly.
Currently, investment in machinery capital is still a budgetary necessity for many companies, now companies frequently specialize in suppliers, manufacturing companies and second-tier subcontractors. This means that they can focus on investing in one or another type of machinery rather than on a broad spectrum. Other prerequisites that were barriers in the past have also disappeared. Proximity was a major concern in the past. Suppliers had to be located near equipment manufacturing companies (OEMs), and warehouses had to be close to population centers and transportation and logistics areas. The arrival of the global supply chain, immediate delivery, cheaper transport costs, make traditional concepts now obsolete.
Technology supports this fundamental shift by allowing SMBs to access buyers, product availability and supply chain resources. If the company has a professional website, reliable e-commerce, international prices and shipping facilities, it can sell its products to anyone who has a smartphone and sufficient funds.
Service-Focused
Customer relationships are more important than ever in manufacturing. Companies are turning to service-centric models. Customer experience is a good way to differentiate yourself from the competition. In addition, excellent service does not require a large capital investment, or a large workforce. Therefore, SMEs have a great opportunity to comply with the necessary services, such as after-sales service, maintenance contracts or warranty management.
The focus on service is a growing trend. Manufacturing companies are starting to make Service offerings, based on results and not just products. Internet of Things (IoT) technology makes this business model possible, and profitable. The data collected from smart sensors helps companies provide an efficient and productive service. IoT data can also be leveraged to help the R&D team know what customers are looking for and where product design works; you can also identify where improvements can be made. Both small and large businesses can analyze sensor data to make more informed decisions, and enable automated responses. Systems are installed so that sensors, artificial intelligence, algorithms and automation work.
Agility
With the speed of today's changes, companies must be agile in responding to new customer demands, emerging opportunities, and changing competitive challenges. Pyes are leaders in agility. Unlike large companies, which have different layers of decision makers, and have more rigid approval structures, SMEs can identify an opportunity or challenge and respond to the concern. Companies must still be reliable in making decisions, based on data, projections and reliable business intelligence.
Again, technology provides the necessary arsenal. Advanced business intelligence solutions provide midsize companies with the same capabilities as large companies that have a lot of market research staff and data analysts. Software for business intelligence can, in fact, provide additional advantages, allowing the company to easily predict future opportunities, be proactive and be the first to offer new product innovations.
Innovation
We are in an era of innovation, and not only when it comes to product design, but also operational technology. Sensor-generated data leads the way for new offerings arising from data collected and analyzed. Innovation is also taking on new forms of business model, alliances, and co-manufacturing. Medium-sized companies are ideal for this kind of innovative thinking.
Crowd-sourcing and capitalists help startups execute their ideas. Technology plays an important part in e-commerce, supply chain visibility, and predictive analytics, all important fronts for managing large volumes of commerce with few expenses.
Summary
Medium-sized manufacturing companies play a critical role in the market, acting as suppliers, subcontractors, manufacturers and catalysts from across the market to work and innovate further, encouraging growth. Medium-sized companies have many advantages, such as agility and their ability to attract new opportunities without the setbacks of so many approvals. They also face difficulties due to limited staff resources and investment capital constraints.
By investing in the right technology, manufacturing companies are able to count on the same functionalities as older competitors. From business intelligence and e-commerce tools, to service and IoT solutions, enjoying the same benefits as its competition.
Text written by Adriana Gutiérrez, Director of Channels, Infor Latin America.
