The role of SMEs in leading the future of smart cities


Across the MENA region and beyond, SMEs represent the nerve centre of the economy; driving exponential job growth and immense economic activity annually. As more and more cities within MENA join the smart city phenomenon, large corporations have evolved to offer innovative services for citizens like real-time city information, designing urban planning projects, and optimising transportation flows. However, although larger enterprises are able to adapt to the transition more smoothly due to their technical capacity, the question remains as to how small and medium enterprises (SMEs) can find their place in the digital revolution and benefit from the smart city ecosystem.

By definition, cities are ‘smarter’ when information and digital technologies are used to educate, mobilise, and improve citizen quality of life. Smart cities are entrepreneurial. They flourish with growing innovation and an increasing number of tech startups that provide solutions to socio-economic problems within a specific area. As such, expediting the integration of SMEs within smart cities starts with investing in the training and promotion of entrepreneurs to enrich their digital skill-set and encourage problem solving, whether it is through hackathons, competitions, incubation services, etc. 

Next, SMEs need to harness the vast availability of advanced technologies in the modern age to their advantage. This has become all-the-more important with the urgency of digital transformation as a by-effect of COVID-19.  Smart tech is a growing area that is being increasingly incorporated throughout smart city systems, with blockchain and artificial intelligence (AI) serving as two prime examples. SME business support that utilises these technologies includes market intelligence to help SMEs explore new markets, platforms, and growth trajectories.

Another emerging area that SMEs can invest in to fit into the greater smart city framework is Internet of Things (IoT) technologies to track and manage inventory automatically, which frees up labour for more important and complex tasks. By doing this, purchasing processes also become more streamlined, and customer service is greatly improved. For SMEs who are up against established players holding larger market share, integrating smart tech can significantly enhance their competitiveness. 

Investment in digital technologies and skills has never been more important.Today, it forms the cornerstone of successful strategies to increase competitiveness and build resilience. As more cities strive towards becoming ‘smarter’, SMEs 一 the backbone of the economy – have a crucial role to play in increasing their digital transformation and upgrading their capacities in order to nurture the wider growth of their cities.