The economic recovery has two pillars: sustainability and digitization. All sectors must focus their strategies towards these two aspects that, although they are not new, Covid-19 has accelerated their need for implementation. In the case of Spain, small and medium-sized companies play a crucial role in the recovery, since they account for almost 100% of the business fabric and employ 2.3 million people.
The economy is already taking steps towards improvement, and growth expectations for small and medium businesses are the best since the second half of 2018. According to the latest Grant Thornton report Pulse of the Medium Spanish Company The percentage of optimistic managers about the evolution of their businesses has tripled since December 2020, leading the largest rebound in its historical series, going from 24% to 60%.
The consulting firm points out that the result is due in part to the health situation, which has improved notably after vaccination, and to the processing and distribution of the 140,000 million euros of funds Next Generation, of which Spain has already received the first check for 9,000 million.
A unique opportunity opens up for companies, and Luis Pardo Céspedes, CEO of Sage for Spain and Portugal, considers that “it is necessary to take advantage of this package of measures to transform a weakened economy after the passage of the coronavirus.” In his opinion, “for SMEs to grow and compete in an increasingly digital and global environment, it is necessary to equip them with the necessary tools to enhance their efficiency”; only in this way, the SME will be able to grow with scalability and sustainability.
Sage coined the term digitization to refer to economic recovery through digitization and economic reactivation; a concept that combines transformation, speed, agility, flexibility, sustainability and human warmth, and that can help GDP grow by 1.8% more annually until 2025.
Midsize companies are hidden champions. This is how the economist Hermann Simon defined them in the 1990s, to refer to those who were leaders in their sectors (champion), but unknown in the market (hidden). To get out of that shadow, these companies need the best tool: technology.
Here are four examples of midsize companies that are growing and moving towards a more digitized business model. They are companies that have opted for digitization without renouncing their traditional essence, that have seen an opportunity.
Don Iberian
Covid-19 plummeted the sector with sales figures down to historic lows. Don Ibérico is dedicated to the production of artisan Iberian pork hams, shoulders, loins and sausages that are sold in stores gourmet from Spain, Holland, Mexico and Japan.
In their process of modernization and adaptation to the new environment, it was essential to identify the phases that they could maintain as they had been for decades. Something as simple as mixing products with your hands was something that gave it differentiation and quality in its activity.
From Don Ibérico they recognize that with the business management solutions they implemented with the help of Sage, it was easier for some of the employees to be able to take turns and operate from home during confinement. In addition, they began to digitally control the stock and the management of purchases and sales, and to open a store on-line directly to the end customer. Sage solutions also allow them to anticipate potential production errors and further differentiate themselves from their competitors.
For two years, Don Ibérico has managed 100% digitally piece by piece and all kinds of processes. The entity is also very involved in sustainability. In addition to the welfare of the animals, digitization allows them to carry out maintenance tasks on the hams that help to avoid, for example, pests without using chemicals.
The company has recovered in terms of turnover, in part thanks to the great acceptance of its store on-line, a sales channel in which its future growth largely relies.
Campos wineries
The restaurant located in Córdoba currently has a turnover of 7 million euros and employs 100 people. When the business acquired a considerable volume in sales and production, the management team decided to implement a kitchen management solution in the cloud, adapting the software to many of the processes and facilitating access to workers regardless of where they were.
The objective was to control the management of events and food production to the smallest detail, including purchases, manufacturing processes and deliveries, and quality control. All this, without losing the taste for the traditional and the culture of the town.
From the hand of Sage they achieved the change, which has been decisive for the progress of the business and which has also increased its capacity for analysis to know the return on each investment and the implications that future projects will entail. The result is higher levels of effectiveness and efficiency.
3DBiotech
He took advantage of the lockdown to digitize the company with Sage’s proposal. The savings in time and resources allowed him to turn to research to create human tissue or bone from stem cells with 3D printers. At this time, the company develops digital systems based on 3D technologies oriented to the dental, clinical and hospital sector.
During the confinement they worked to rebuild the business and bet on the future. The solution was to interconnect all the departments in an integrated digital solution. With this, they can combine various actions such as sales analysis, order control, and financial analysis and of all the strategies of marketing; All of this makes it easy to make the right decisions in a very short time.
For the company, digitization is not automation. To carry out their activity, they still need people who command decisions and contribute ideas, with the difference that now they have more information at their fingertips. That saves time and money.
Digitization in 3DBiotech is noticeable in the speed when it comes to launching an order or technical service or to carry out a follow-up, and in the security that it transmits to the customer. After an ERTE that affected 80% of the workforce due to Covid-19, the company has recovered the entire workforce and created new jobs to promote technological development.
Heredad de Monteagudo
Heredad de Monteagudo is located in Torrenueva (Ciudad Real), the second Spanish olive oil exporting region, with almost half a million hectares dedicated to production and almost 300 oil mills.
The company is focused on the transformation, packaging and marketing of olive oil. Its annual turnover reaches six million euros and it has a presence in 25 countries. Despite the excellent development of its business, it required cost control and access to production data in the plant in real time to guarantee the highest quality of the process and final product.
In 2019 the management opted for a solution of software of integral business management, customizable and connected to the cloud. The goal was to automate all plant processes and improve oil traceability through unified management.
With this technological implementation –provided by Sage–, each employee receives a work order in real time. Likewise, the company has a specific program for scanning invoices that automates the reading and mechanization in a high percentage, which favors a paperless management, in a faster and sustainable way.
Heredad de Monteagudo took advantage of the digitization process to renew its brand identity and launch a new website. In parallel, it included a sales channel on-line controlled directly from the software.
Looking to the immediate future, and when telecommunications coverage is ideal in the area, the next objective is the cloud to take advantage of all the capabilities offered by the integration of the software and improve access to business information.
José Luis Martín-Zabala, vice president of indirect sales at Sage Spain, reveals that “the pandemic has been used by seven out of 10 Spanish companies to promote digital transformation, thinking of digitization as a necessary investment and not as a cost or project more. In fact, digitized companies have shown greater resilience, with a revenue drop up to 10 points less than non-digitized ones ”.
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