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The economic power of the SME segment continues to increase, as again became clear at the 2nd SAP SME Summit in November. While big companies usually make the headlines, it’s the small and mid-size enterprises (SMEs) that are the lifeblood of the economy. By 2020, they will create 50 percent of gross domestic product (GDP) globally and 90 percent of jobs in the US. SMEs present an enormous driving force especially in emerging markets such as Brazil, India or Africa to create jobs and stimulate economic development.  Globally, there is also strong growth in“social enterprises” – for-profit business that pursue a social mission.  The ultimate in doing good by doing well!

Sadly, many start-ups fail – about 90% in fact. But established companies such as SAP are in a good position to help many get on the path to success.

With its eye on the social impact they can make by helping social enterprises,  SAP partners with non-profit organizations to help these organizations accelerate their growth in various ways: training and mentoring, on-site support through skilled-volunteers, technology donation and access to SAP’s business network.

Helping a small social enterprise turn the corner to sustainability can impact thousands of lives.  For example, SAP mentors worked on a growth strategy with The Involute Institute of Technical Training (IITT) in India. As a result, the business has expanded from one to three states and increased their reach to 5,000 young people who received entrepreneurial and vocational skills training to prepare them for successful IT careers.

Its takes an ecosystem

While direct support for small enterprises can be a tremendous help to a growing organization, one-to-one assistance alone will not drive sustainable change. As Ravi Chauhan, the Managing Director of SAP India puts it, “The entrepreneurial ecosystem is a tremendous generator of employment and innovation.”  And it is only through supportive ecosystems that the broader challenges of small enterprises can be met: governmental and policy support, establishing strong business networks, education systems that foster entrepreneurial thinking, access to funding, etc.

Addressing these systemic issues is part of SAP’s Emerging Entrepreneur Initiative. SAP is working with ecosystem partners to promote entrepreneurship and encourage companies, government, non-governmental organizations and social entrepreneurs to collaboratively support social enterprises. At the
recent SAP-NEN Entrepreneurship Summit in Bangalore, Indian ecosystem representatives came together to collaborate, exchange ideas and learn from each other, and to pave the way for many more such initiatives. Because that’s the point: Individual support for entrepreneurs with growth potential is
important but doesn’t scale. It takes an ecosystem.

A new chair to add new impetus through science and research

To help pave the way, SAP recently announced support for an SAP Faculty Fellow Professor Chair (Endowed Chair) for entrepreneurship and social innovation at the renowned India Institute of Management in Ahmedabad (IIMA).  Involving  policy makers, administrators, academia and corporations, the initiative will conduct research and establish best practices to support micro, small and medium enterprises, family run businesses and growth stage enterprises. Areas covered will include healthcare, agriculture, education and skills development, as well as renewable energy and sustainable public services.

SAP’s Emerging Entrepreneur Initiative began in 2013 with a focus on Brazil and India. In 2015, the initiative will expand to Kenya. So stay tuned!

More about SAP’s Emerging Entrepreneurs Initiative