What Should SMEs do to Succeed in Today's Knowledge-Based Economy?

Abstract

The shift to a knowledge-based economy results largely from developments in information and communications technologies. Knowledge-based economies offer huge opportunities for small to medium-sized enterprises (SMEs) to develop entirely new high-value products and services, add value to existing products and services, reduce costs, develop new export markets, and add value to existing activities. Implicit promises include access to world markets, low-cost entry into new markets, and the ability to gain efficiencies in business processes. However, these promises may be illusory for most SMEs. Technological, organizational, and marketing hurdles are also making it more difficult for SMEs to succeed in knowledge-based economies. This chapter identifies those major factors that are hindering the success of SMEs in knowledge-based economies. The chapter then goes on to suggest a set of guidelines to make SMEs succeed in this new knowledge-based society.