Small Businesses Adapting to Rapidly Changing Economic Landscape, Study Finds

Published
30 Nov 2021
2021
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Sam Werthmuller, Public Engagement, World Economic Forum, swer@weforum.org

  • A new study by World Economic Forum finds that previous disadvantages can lead to new opportunities for small and mid-sized enterprises (SMEs)
  • Report highlights how SMEs can leverage their size, networks, people and technology to support sustainable growth, positive societal impact and robust adaptive capacity
  • Report was developed in collaboration with the National University of Singapore Business School, the University of Cambridge Judge Business School and the Entrepreneurs’ Organization
  • Read the full report here

Geneva, Switzerland, 30 November 2021 – The World Economic Forum has long been at the forefront of recognizing the strategic importance of sustainable value creation objectives for business. While interest has mostly focused on how large corporations contribute to the global economy and sustainable development objectives, small and mid-sized enterprises (SMEs) are often overlooked as major drivers of economic activity, as well as social and environmental progress around the world.

A new report released today finds factors that previously disadvantaged SMEs can lead them to new opportunities. Nine case studies from multiple industries and regions highlight what SMEs can do to increase their future readiness.

Developed in collaboration with the National University of Singapore Business School, the University of Cambridge Judge Business School and Entrepreneurs’ Organization, the report also finds that SMEs are lagging behind in terms of societal impact. Although there is a clear need to operate in line with sustainability goals, many SMEs have yet to include explicit strategies and performance measurement centred on societal impact.

The top challenges cited by SME executives include talent acquisition and retention (for 52.5% respondents), survival and expansion (43.8%), funding and access to capital (35.7%), non-supportive policy environment (21%), the difficulty of maintaining a strong culture and clear company purpose and value (20%).

SMEs can leverage their size, networks, people and the strengths of technology to support their goals of sustainable growth, positive societal impact and robust adaptive capacity. While it is essential for SMEs and the wider economy to increase their future readiness, they can thrive only insofar as the necessary supporting infrastructure and regulatory frameworks exist.

“We hope this will inspire and encourage SMEs and mid-sized companies to harness their potential in becoming a major driver of sustainable and inclusive economic growth and innovation by focusing on several core dimensions of future readiness,” said Børge Brende, President, World Economic Forum.

"Through this report, the Forum aims to highlight the significant role SMEs can play not just locally but also globally. The New Champions Community is a step towards bringing these smaller companies into the forefront of global discourse around socioeconomic development and engaging them in a community of forward-thinking companies from across the world," said Stephan Mergenthaler, Head of Strategic Intelligence and Member of the Executive Committee, World Economic Forum.

The report aims to develop a deeper understanding of organizational capabilities and orientations needed for SMEs to successfully generate lasting financial growth, affect society and the environment positively, and develop high levels of resilience and agility.

It relies on robust research methods and combines rigorous primary and secondary research. The takeaways and conclusions presented in the research have been derived from an analysis of over 200 peer-reviewed articles and engagement of more than 300 CEOs and founders of SMEs through surveys and in-depth interviews.

The World Economic Forum is looking to deepen its engagement with smaller companies through its New Champions Community. The Forum is now accepting applications from forward-looking companies that are pioneering new business models, emerging technologies and sustainable growth strategies.

Notes to editors
Read the report here
Learn more about the New Champions Community and apply here
Explore the latest strategic trends, research, and analysis on Small and Medium-Sized Enterprises with our Strategic
Intelligence platform here
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All opinions expressed are those of the author. The World Economic Forum Blog is an independent and neutral platform dedicated to generating debate around the key topics that shape global, regional and industry agendas.

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