Navigating the complexities of geopolitical changes presents unique challenges for small and medium enterprises (SMEs). It is important to reiterate that SMEs are not just scaled-down versions of larger corporations, and that they play a complementary role in society alongside their larger counterparts.
Some SME-Driven Responses to Geopolitical Changes
While larger companies may have the resources to absorb geopolitical shock, SMEs don’t have that luxury and must adapt quickly. Their responses include diversifying suppliers, sourcing closer to home and investing in technology.
Supply Chain Diversification: Supply chains have shown themselves to be vulnerable recently. SMEs can therefore assess their current situation to see where they are at risk, determine what assets they can build upon, identify alternative products or suppliers, and carry out due diligence to ensure that new assumptions and relationships will work. For SMEs who might be sourcing far away from home, this might be an opportunity to re-think assumptions and source for inputs closer to home. Approached in the right way, these kinds of exercises can be an opportunity for innovation or for strengthening ties with larger companies, who are also seeking to secure reliable suppliers.
Investing in Technology: Technology and Artificial Intelligence have been key to solving problems during recent crises. Along with supply chain optimization, these can be further used to improve efficiency and reduce costs. Technology tools can also be used in other areas, including automating a range of company functions.
Resources for SMEs
To help with the capacity to carry out these suggestions, and others, SMEs can carefully look for SME resources, and collaborate with other organizations and with the community:
Region-specific Resources: Small and medium enterprises (SMEs) have access to various region- specific resources designed to support their growth and resilience. In North America, this could be SBA related; in Africa, organizations like Acumen could provide needed support. Any of these should be approached advisedly in the current context.
Collaborations with NGOs and Educational Institutions: Partnerships with non-governmental organizations and universities can provide access to volunteers, interns, and training programs. Such collaborations can enhance skills and provide additional human resources at potentially reduced financial costs.
Community Engagement: Building strong local networks can provide support and resources. Engaging with local business associations and chambers of commerce can offer platforms for shared learning and collaboration.
Carrying out SME-specific strategies like these and leveraging available resources, are among the steps that SMEs can take to navigate geopolitical challenges, and turn potential obstacles into opportunities for growth and resilience.
Dr. Memuna Williams has a BA and MA in Translation, an MBA, and DBA. Her doctoral thesis illuminates how SMEs develop social responsibility programs across four phases and 13 categories. Dr. Williams and her husband Victor have three sons. Connect with her at: www.linkedin.com/in/dr-memuna-williams-dba-8193b01
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