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The 2015 SAP Small and Midsize Enterprise (SME) Summit (#SAPSMESummit) held in New York was all about simplification and growth.

In the opening keynote, Rodolpho Cardenuto, the president of global partner operations at SAP, reminded us how important SMEs are to the global economy. Although small in size, SMEs make up 95% of all companies and employ 55% of the world’s workforce.

Growth is obviously a key objective for SMEs. The global, digital economy presents many new business opportunities, but big success is rare and doesn’t come easy. The SMEs that see the openings and respond quickly are surging ahead. The trick however, is not to let complexity creep into the business as it grows.

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“Business simplification is much more important to SMEs than ever before,” said Cardenuto. He backed his statement with new research conducted by Knowledge@Wharton and SAP. The survey titled, “Simplifying the Future of Work,” reveals how important it is for SMEs to design their businesses to run simple from the beginning.

According to the survey, 72% of SME leaders and team members say business complexity has hurt efforts to meet process and decision making goals. Over 30% said it “strongly inhibited” that ability, and 58% pointed directly to technology complexity as the culprit.

Avoiding technology to reduce complexity is certainly not an option. SMEs must leverage IT solutions to participate in the digital economy. But SMEs often get caught in the trap of using one-off IT solutions to meet short term needs. That approach quickly results in problems as more disjointed solutions are added to the mix. The IT landscape becomes more costly and difficult to manage, and business processes and employees get bogged down by inefficiency.

Building a business to Run Simple with efficiency from the start may seem logical, but the survey showed that only 49% of senior leaders believe business simplification is of significant strategic importance today. That number jumps to 65% when asked if they believe it will be of significant strategic importance within the next three years.

“To enable digital transformation, SMEs need to build a foundation for growth and simplification,” said Cardenuto. The earlier SMEs can implement systems that simplify business processes, transactions, and reporting the faster they can react, respond, and win more business.

“Digitizing the core business is the first step,” said Cardenuto. An integrated ERP solution designed for SMEs will pull together financial, supplier, customer, and workforce processes and information. It will also centralize and standardize business data, enabling real-time reporting and analytics.

The implementation of a core ERP system also needs to be simple. “SMEs need immediate ROI from IT investments,” said Cardenuto. “Solutions need to be easy to consume, price, and configure, and they must be able to scale with the business.”

The message to SMEs in the keynote was clear: focus on simplifying your business now – in the long run, it will perform better and grow faster.

Read the full Knowledge@Wharton white paper and check out the infographic.

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