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MSMEs back in business present many silver linings

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By Alithea De Jesus

With the calibrated opening of the business, the Filipino entrepreneurs find silver linings after getting a big blow from the slowdown of economic activity due to the COVID-19 pandemic.

According to Director Jerry Clavesillas from the Bureau of MSME Development under the Department of Trade and Industry, “As we started to ease up the situation or the restrictions, most of the Micro-, Small and Medum Enterprises (MSMEs) are already going back to their normal operation.”

“We’ve gone from our first survey in March where about 35% of the MSMEs are in a true stop operation, 51% are partially operating and 14% are fully operating. In our recent survey, fully-closed businesses is only 6% while 47% are partially operating and 47% are in full operation,” Clavesillas added.

Director Clavesillas, in an episode of IT leader Cisco’s executive live series entitled “Navigating the Shift”, also noted that digital acceleration played a pivotal role in the survival of MSMEs.

“This is evident mostly among the food processing sector because most of them were not allowed to open up their establishments. They resorted to online marketing and delivery and used digital platforms to give them the ability to reach their customers despite the closure of physical stores,” said Clavesillas.

Comprising of 99.6% of the businesses and accounting for 70% of employment in the country, the survival of the MSME industry is crucial to the survival of the Philippine economy. However, the pandemic has crippled their access to financing, resources, and even technical capacity. 

Fortunately, help is available.

Meanwhile, Karrie Ilagan, Managing Director of Cisco Philippines. said, “This is the first time in our lifetime where everyone in the world gets to experience the same thing and have common learnings so that we can also take the right collective action.”

“Cisco has been looking at the common pain points of MSMEs around the world and in response, we have launched programs specifically designed to help MSMEs not just to survive but to thrive in this situation.”

At the onset of the pandemic, Cisco launched Cisco Designed – a suite of simple IT solutions to solve complex problems, addressing essential needs for remote work, cybersecurity, and connectivity. Earlier this year, Cisco also launched their 0% financing program that allows small businesses to acquire crucial technology software and hardware without large upfront costs. Together, both programs allow MSMEs to use enterprise-grade technology and level with larger businesses in the industry.

“While many things have become a given today, our advice mainly is to first understand what kind of business processes have to go digital because you don’t necessarily have to do that all in one go. Second, it’s about security. It’s not just about transactions but even in how we communicate with our customers. Lastly, not everybody is a digital native. There is a need for greater investment to learn and to acquire digital skills. Part of the adaptation is that we need to change our mindset and to really learn technology so that MSMEs can continue to operate successfully,” said Ilagan.

Partnerships have also created new solutions for MSMEs to thrive, such as BEYOND FIBER, a partnership between Cisco and PLDT.

Industry leaders discussing the positive signs that MSMEs can expect in the reopening of the company during Cisco’s executive live series entitled “Navigating the Shift”

“BEYOND FIBER gives MSMEs access to enterprise-grade technology with superior fiber connectivity that comes with an enhanced service promise fit for business,” explained Mitch Locsin, First Vice President and Revenue Group Head of PLDT Enterprise. “It includes Cisco Meraki wherein you can proactively manage connectivity for office work or for customers’ use, monitor usage of your network and have the cybersecurity solutions in place. Through Beyond FIBER’s curated solutions approach, businesses can also stack up on requisite digital tools and add-ons such as Cisco Webex and Paymaya e-payment solutions.”

And while technological adoption has become crucial regardless of industry, some fundamentals remain as the most important factors in succeeding as a business.

“Startups also had to pivot when it comes to relevance,” said Carlo Calimon, President and Co-Founder of Startup Village. “Because of a changing and evolving customer base, they had to come up with something that’s more important, that’s more relevant. Going into the new year, businesses that will succeed focus not just on relevance and essentials but on making people happy.”

Ultimately, MSMEs are advised to embrace change and be prepared for a different world post-pandemic. It has become inevitable to not just adapt but also evolve and technology seems to be the main driver for this change. 

At the same time, the human capital of every MSME will be the core strength of each business.

“MSMEs need to cultivate creativity among ourselves, among our offices, create a culture of idea exchanging,” advised Jorge Wieneke, CEO of Tokyo Tempura and the president of the Association of Filipino Franchisers. “There’s a lot of things to innovate now, so being creative is using tools to survive. It’s about cultivating the right culture.”

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