The Role Of Networks In Supporting SME Development And Mitigating Disruptions: Exploring Alternative Approaches Using Big Data Technology

Research Background

The current trends in the global market have forced business organizations to diversify their market approaches for survival purposes and adopt necessary changes to enable them to survive the high competition facilitated by the large and well-established organizations (Keeble and Wilkinson, 2017). The most affected sector in this scenario has been the SME sector which naturally faces limitations in regard to resource availability.  Some of the changes which have been adopted by this sector include but not limited to inter-company cooperation and networking. These two approaches have enabled SMEs to compete favorably with established organizations which can afford to finance innovations and quality adverts.  Today, all the sectors have however been impacted by the evolution of networking relationships in and between firms.

However, majority of studies which have been carried out focus on enlightening SMEs on the importance of networking on their performance and non has dared to focus beyond the mark to brief those enterprises on the way to go in case networking approach hits the wall as it has been observed currently in the Brexit case where the European Union network, which has been heavily relied on by the SMEs has begun to deteriorate following the forthcoming announcement of UK to exit the union (Shneor, Jenssen and Vissak, 2016, p.135). This paper has taken the initiative of enlightening SMEs on the way the way to go whenever networking backfires. Mainly, the research will be concerned about big data technology as an alternative to networking and ensuring that SMEs performance and growth is maintained despite the normal challenges faced in regard to networking.  

Networking has proved to be a very effective way and which has enabled SMEs to thrive in a competitive environment under minimal budgets compared to big organizations. Benefits of SMEs networking have been critical to their growth and development. It has enabled them to build strong relationships with each other as well as preparing them in terms of innovation and getting reliable information from different markets (Galkina and Chetty, 2015, p.650). This is in consideration of the fact that building successful businesses is a complex venture and calls for dedication which can be costly for SMEs to afford. It has however been made easier through networking, an approach that enables these enterprises to have business friends and associates from which they can draw knowledge to keep them moving.  As an established network of enterprises with similar drive and common ambitions, the sector of SMEs has been able to move forward as a group. That has however not been the only benefit of networking but only a pacesetter. Networking has also been a platform for knowledge sharing. Great ideas in regard to expansion and innovations have been shared through networking (Dankbaar, 2017, p.175). Whether it’s all about seeking clarity on issues affecting the performance of one SME or the other, it has helped these SMEs to expand their knowledge and focus on their operations from different perspectives. In those networks, the experiences of founders in the sector have been an opportunity for the new entrants to learn and avoid common pitfalls in the sector.

Research Problems

Networking has also been a source of opportunities whether through referrals, offering partnerships or being outsourced, which has been possible through connections. Lastly, networking approach has enabled SMEs to raise their profiles, which has been achieved through the many business and social events where they are represented and get to be recognized (Measson and Campbell, 2015, p.100). There have been building their reputation and hence enabling them to get more referrals and leads to people who may need to transact with them. Considering all the above advantages of networking to SMEs, it clearly comes out that the driving force behind the ability of networking to facilitate performance and growth of SMEs is all about enabling these enterprises to obtain useful facts and other important data in the market.

However, under scenarios where regulatory measures are introduced as it has been observed in the European Union network currently, the end results are likely to be severe on the SMEs sector (Johansson, 2015, p.715). To bridge that gap and ensure that performance and growth of SMEs are upheld, this research proposes the adoption of Big Data technology to enable SMEs to get market facts and data which will enable them in making wise decisions. For instance, instead of networking approach which has been used initially by SMEs to gain insights on the market progress and decision making, data exploration which is a technology under Big Data will be used whenever such a data is required. 

Data exploration will utilize both statistics and other approaches like experiments to gain an understanding of factors such as market progress and answers to consumer issues. This approach will also leverage on predictive modeling technique to predict market changes based on previous performance of the sector (Botha, Van and Kunene, 2015, p.60). Under this category, cluster analysis will also be used to segment consumers into based on common attributes that may not appear on analysts’ radar screens. Once such answers are obtained, SMEs will be in a position to take actions such as modifying their marketing strategies, upgrading their services and up-selling their products. Armed with this data, SMEs will be in a position devising proactive strategies to enable them to retain their position in the global markets.

Considering the fact that British is among the main partners of European Union, its exit from the union is likely to have huge impacts on the SMEs operating under the union (Keeble and Wilkinson, 2017). First of all, it’s important to note that one of the major limitations on the SMEs operation is the lack of resources to enable them to achieve their objectives easily. Secondly, it’s also important to note that the main advantage of trade unions to SMEs is their ability to wave away all trade restrictions which make it hard for these small enterprises to operate efficiently. For that matter, Brexit is expected to have huge impacts on the operation of these enterprises.

The exit of British from this union will mean that the already waved tariffs and other trade requirements will be restored and become applicable to all the organizations which wish to trade within the country including the SMEs. Considering that one of the SMEs challenges is the lack of resources, they are expected to face it hard to carry out their activities within the country especially those entirely depended on British market (Botha, Van and Kunene, 2015, p.63).

SMEs whose brand names and trademarks have been registered under the European Union is also expected to face it hard in regard to protection once Britain leaves the union. The absence of necessary protection on these brands will open rooms for other parties to duplicate products and circulate in the market making it hard for the SMEs to succeed (Measson and Campbell, 2015, p.110). As if that is not enough, making new registrations and converting the brand names afresh in order to protect their intellectual property is expected to pose cost challenges to these enterprises considering their limitation in terms of resource shortages.

It is expected that after Brexit, both the administration and other associated costs of importing good into the UK will increase. For instance, duty deferments and VAT are likely to become more complex. For that matter, the Pan-European companies which currently benefit from the economies of scale will be deprived of those benefits post-Brexit (Botha, Van and Kunene, 2015, p.67). So, the SMEs operating in the UK will find themselves being charged highly for the services they currently use cheaply. This will be a heavy blow to those enterprises considering their main challenge as far as resources are concerned.

Lastly but not least, the networking advantage which has been enjoyed by the SMEs which operate on export bases in obtaining relevant  information in regard to prevailing markets abroad as well as gaining insights on the market competitiveness is likely to become a challenge especially for the SMEs which have leveraged mainly on UK markets (Measson and Campbell, 2015, p.96). This, therefore, calls for the adoption of other approaches which will enable those enterprises to remain updated as far as global market information is concerned.

There are a number of objectives to be achieved by this research. They include

1. Enlightening the SMEs on the role played by trade unions (European Union) and the anticipated outcomes following the partial disruption expected soon
2. Preparing the SMEs to face the challenge which is expected post-Brexit
3. Advising the SMEs on some of the approaches they should adopt to cope with the situation post-Brexit like leveraging on Big Data technology

1. What has been the role of the European Union in the growth of SMEs?
2. How does the anticipated exit of Britain from the European Union likely to disrupt the operations of SMEs
3. What are some of the approaches which can be adopted by the SMEs to coup with the anticipated disruption post Brexit?
4. One of the approaches to cope with the situation post-Brexit is the implementation of Big Data technology. How effective with this approach be compared to the previous networking approach?

Different researchers have expressed their opinions on the anticipated impacts of Brexit on the SMEs sector. The common thing about all the opinions which have been expressed by those researchers is that all have anticipated negative impacts on this sector. Considering the challenge of limited resources, many of the research studies have indicated that Brexit will likely to have huge impacts on the SMEs operating under the union in various ways and which touches on the issue of limited resources in a large extent (Botha, Van and Kunene, 2015, p.61). First of all the exit of Britain from this union will mean that the already waved tariffs and other trade requirements will be restored and become applicable to all the organizations which wish to trade within the country including the SMEs. Considering that one of the SMEs challenges is the lack of resources, they are expected to face it hard to carry out their activities within the country especially those entirely depended on British market (Measson and Campbell, 2015, p.98).

Secondly, the SMEs whose brand names and trademarks have been registered under the European Union is also expected to face it hard in regard to protection once Britain leaves the union. The absence of necessary protection on these brands will open rooms for other parties to duplicate products and circulate in the market making it hard for the SMEs to succeed (Botha, Van and Kunene, 2015, p.70). As if that is not enough, making new registrations and converting the brand names afresh in order to protect their intellectual property is expected to pose cost challenges to these enterprises considering their limitation in terms of resource shortages.

Mainly, most of the researchers have to concentrate their attention on predicting the expected results post Brexit. From a scientific point of view, any research which does not give or provide a solution for an identified problem is deemed inadequate. Observing this principle, it comes out clearly that there is a literature gap in regard to this matter. The gap has been brought about by the researchers concentrating much on predicting the problem and very few of them attempting to propose solutions to the anticipated problems (Measson and Campbell, 2015, p.120). This research attempts to reduce that gap by proposing a solution to one of the anticipated problem post Brexit, networking issue. It proposes the implementation of Big Data technology by the SMEs which will enable them to collect and analyze market data for the purposes of decision making.

In this research, Quantitative research method will be used. After carrying out some extensive literature review and empirical research on different SMEs to understand the current state of knowledge regarding the contribution of entrepreneurial networking activities on their growth and performance, we will also embark on researching on some of the organizations which have adopted big data technology specifically the Amazon and Netflix to scrutinize some of the ways they have used this technology to gain an understanding of how big data can be used as a source of market data. The first step in this approach: selection of SMEs will be performed as per the following steps:

• Selection of the appropriate sample (selected randomly from a reviewed list of SMEs in the United Kingdom.)
• Defining the measurements of networking activities
• Model structuring: A model will be designed to include all the elements relating to SME networking activities and each element of the framework reviewed for the purposes of
  both theoretical and empirical foundation, and then questions will be used in order to provide all the identified measurements

The main approaches to data collection which will be used in this research are:

• Questionnaires and
• Interviews

The first step in this stage will be data processing: this will be carried out to measure the association and the correlation between different variables, Pearson correlation for data approach of measurements on quantitative variables and the chi-square statistic χ2 for the nominal data as well as phi coefficient f and Cramer’s V will be used. In comparing the averages between different groups, the independent sample t-test for quantitative variables will be used. For data reduction, factor analysis will be performed in order to enable the research conclusion with multiple regression analysis. Research results, either confirmation or rejection of stipulated hypothesis as well as suggestions for further research will finally be made

This research will entail collecting enterprise data that can be taken as an advantage by the rest of the competing enterprises for competition purposes. For that matter, any data or information which will be collected during this research will be highly maintained confidentially to avoid exposure to the public domain where it can be easily accessed by competing partners of the enterprises.

References: 

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