JEDDAH — Small and medium-sized enterprises (SMEs), particularly those punching above their weight thanks to empowering IT solutions, are key to Saudi Arabia's future prosperity, a round-table event hosted by SAP, revealed. “Information technology is a key pillar for SMEs to become a prime engine of economic growth in Saudi Arabia,” said Ahmed Al-Faifi, Managing Director, SAP Saudi Arabia. “The advances in business-oriented solutions for Mobility, Analytics and Cloud, are driving the competitiveness of SMEs by furnishing business leaders and entrepreneurs with the best in class technology innovations needed to gain clear insights of the business dynamics at their finger-tips, any time, any place,” he added. SAP believes that more technologically empowered SMEs can have a particularly positive influence on job creation in Saudi Arabia. The Ministry of Labor estimates that unemployment stands at around 10 percent among Saudis, and youth unemployment is four times higher than any other age bracket. There is also plenty of scope to improve business competitiveness and profitability, with a report recently published by the World Bank noting that the SME sector currently forms 90 percent of all Saudi companies, yet only contributes a quarter of total employment and about a third of the country's gross domestic product. Saudi Arabia's Ninth Economic Plan (2010-2014) has specifically highlighted the importance of SMEs in the development of the Kingdom's economy. Encouragingly, IT-driven innovation among SMEs on the rise in Saudi Arabia; SMEs spent $2.85 billion on IT in 2011 - 33 percent of the country's entire IT expenditure - and IT market intelligence leaders IDC predicts a five year compound annual growth rate (CAGR) of 12.6 percent over the next five years. According to Gartner, the global SME market is projected to grow more than $1 trillion by 2014, with a five-year CAGR of 5.7 percent. Fellow analyst Forrester notes that the SME ERP market alone is expected to grow to $31.3bn by 2014 (CAGR 6.1 percent). “Saudi Arabia needs to stimulate the development of existing SMEs, beget new companies through better financial solutions, provide greater access to markets, and facilitate targeted mentoring of youth and entrepreneurs,” said Dhiraj Daryani, Research Manager, IDC MEA. “The best way that SMEs are preparing for growth is to have sophisticated business systems in place that allow small companies to operate like big companies, and ultimately compete and win business.
But it doesn't end there. Smart SMEs are also standing out from the crowd by investing in the big trends of 2012: mobility and cloud. In doing so, progressive companies are not only investing in technology innovations but are garnering results in terms of higher revenue expectations to drive impact.” Saudi construction, trading and manufacturing business Abdullah Al-Sayed Group also turned to SAP when it needed to take the company to the next level. Working with partner SAP partner CIC, the company's implemented Business-All-in-One. “Nowadays, an SME needs it all: a business solution that is flexible to meet the current and future needs while also being affordable, efficient and eminently adaptable. Through implementing SAP we have created tremendous added value for our stakeholders, and achieved an entirely new level of operational performance and excellence. SAP is currently working side by side to our blue collars workers and engineers even in dust and rain, providing an exceptional alignment between technology and practice,” said Salman Abdullah Al-Sayed, CFO,Abdullah Al-Sayed Group. — SG
