Why adopting cloud computing is essential for South African SMEs' growth

• Reliance on technology is increasing globally, and local SMEs can leverage the technology advancements to grow.
• Cloud computing is one such tech solution that can foster the growth of SMEs, but they shy away from it.
• This is because they think it’s meant for big corporates, but it can be accessible and is necessary, a tech expert said.     

Cloud computing is a crucial tool to foster the growth of small to medium enterprises (SMEs), but they often shy away from adopting the tech solution due to the perception that it is only for large corporations.

But, SMEs adopting cloud computing offers huge benefits for these organisations.

In simple terms, cloud technology or cloud computing is storing and accessing programmes and data using the internet instead of hardware, such as one’s own hard drives for data storage.

Various cloud technology or cloud computing services include access to servers, storage, databases, networking, software, analytics and internet intelligence to help run one’s business faster and more efficiently.

Some of the simplest benefits of using cloud technology for SMEs include data protection, data backup and recovery, big data analysis, anti-virus applications, testing and development, e-commerce applications and more.

More than anything, it allows businesses to scale, maintain flexibility and pointedly focus their efforts on the operations of the business and not on managing complex IT infrastructure.

According to the chief operating officer at One Linkage, Pragasen Naicker, the uptake of cloud computing services by SMEs in South Africa is not yet strong because many of these businesses aren’t aware of how to integrate the tech solution into their business’ ecosystem.

To combat this, Naicker said there needed to be education drives for SMEs.

One Linkage is a cloud technology company that offers services for corporates who enable SME cloud service development and integration.

“I would say that adoption is very low and the main reason for that is there could be a lack of awareness, a feeling that cloud is too technical for SMEs, and also a lack of understanding of where the opportunities lie,” Naicker told News24.

Affordability

In the past, businesses had to get individual licences to get access to various applications and software services, and this was often a very expensive endeavour.

With cloud computing, getting these services is more cost-effective.

This is because cloud services provide multiple functions in one. While it’s more affordable than the solutions of the past, in some instances it can still be considered steep, but Naicker said it’s a worthwhile investment.

“Affordability is a concern and it is a sacrifice in terms of building that productivity tool into your business upfront,” Naicker said.

“If you can afford it, it helps tremendously. We, at One Linkage, realised that small businesses need the support, and we are approaching corporates to help infuse technology into their ESD programmes.

“If corporates can help SMEs upfront with the initial set of technology tools or productivity tools, and build it into their system, SMEs can become more productive and hopefully sustainable beyond that one of two years of support that corporates give them.”

Corporate support for SMEs

Many large companies in South Africa have Enterprise and Supplier Development (ESD) programmes aimed at promoting the creation of sustainable growth partnerships between corporates and entrepreneurs.

Companies, such as Telkom and Sasol – among others – have various initiatives to foster SMEs’ growth, using cloud technology.

According to the head of enterprise and supplier development at Sasol, Jabulile Ratsibe, the chemicals and energy company uses One Linkage to “provide SMEs with access to opportunities that are available within Sasol” – and the company also shares the offerings of the SMEs they engage with to their existing clients, creating an ongoing ecosystem of opportunities.

Sasol, and other organisations involved with One Linkage, then step in to elevate these small businesses to where they need to be in order to become a supplier.

Currently, Sasol has over 1 000 businesses across sectors registered to be assisted on the One Linkage platform.

“SMEs should try and put their companies out there on platforms such as One Linkage, so that there is that visibility – and, when opportunities arise, companies like Sasol can check on the platform to see who’s there and what is it that they do,” said Ratsibe.

READ MORE:Why adopting cloud computing is essential for South African SMEs’ growth | News24