Empowering Small and Medium Enterprises with Data Analytics for Enhanced Competitiveness

Abstract

In today’s competitive landscape, Small and Medium-sized Enterprises (SMEs) are increasingly embracing business data analytics to gain valuable insights and make informed decisions. However, the true essence of big data lies not only in its volume but also in the analysis process and the derived insights that aid managers in making effective business choices. Despite this, limited knowledge exists regarding SMEs’ utilization of data analytics and its potential in facilitating informed decision-making. Therefore, this paper aims to elucidate the concept of business data analytics within the context of SMEs and outline the essential requirements for its effective implementation, enabling SMEs to leverage data analytics for enhanced competitiveness. It is proposed that the foundation of a successful data analytics system for SMEs should encompass four key elements: data, people, technology, and process. The degree to which data analytics contributes to a firm’s competitiveness is largely influenced by four factors: data quality, well-defined objectives, the caliber of analytic tools and techniques, and analytical skills. Data generates information and insights, which in turn foster knowledge that ultimately leads to wisdom. However, due to limited resources, SMEs may be less inclined to engage in advanced predictive and prescriptive analytics compared to larger firms.