Collaboration and the Progressive SMB

Almost all businesses aspire to success–but not all achieve it. SMB Group has identified and written quite a bit about what we term “Progressive SMBs.” Progressive SMBs are more growth driven and invest more in technology than their counterparts. They also view IT as a tool to help the business grow, create market advantage, and level the playing field against bigger companies.

Most important, being a Progressive SMB pays off. In our 2012 SMB Routes to Market Study, 85% of SMBs that plan to invest more in technology anticipated revenue increases. In comparison, only 42% of SMBs that plan to decrease IT spending expected revenues to rise.

Personifying the Progressive SMB: Apex Supply Chain

apex logoI recently had the chance to speak with Karolyn Schalk, VP of IT Infrastructure at Apex Supply Chain. Apex designs and manufactures what it terms “Point-Of-Work Solutions”— vending machines, cabinets, and other devices, as well as software to manage use, inventory, and replenishment. Apex solutions can manage any supplies, tools or equipment that need to be tracked and controlled.

Apex illustrates the kind of attitudes and behaviors that make the fast-growth, Progressive SMB tick. Founded just seven years ago, Apex has grown to become the global leader in automated vending, supplying over 6,500 companies with vending machine solutions. Apex has fueled this growth with new employees, innovative solutions, new locations and acquisitions.

As the company grew, it invested in sales, marketing and service solutions to help increase sales and provide responsive service. But Schalk realized that Apex also needed a better way to collaborate. Sticking with “email collaboration” would eventually slow down innovation, time to market and customer responsiveness–and along with it, growth and expansion.

Cleaning Out the Collaboration Junk Drawer

junk drawer Apex had opened more locations, hired more employees, created new offerings, and made a couple of acquisitions. It’s network of external suppliers, partners, contractors and installers expanded.

But Apex was still using Microsoft Small Business Server and an assortment of email, file sharing and SharePoint for collaboration. Over seven years, Schalk explained, “this had turned into the equivalent of a big junk drawer. Whatever organization was initially in there had been lost.”

As a result, people had problems finding the information they needed, locating the right contacts to get a job done, and tracking tasks. With “end-users living in email, time was wasted and the risk of things falling through the cracks grew,” notes Schalk. “We needed something more manageable and useable to share information and track work.”

Crossing the Collaboration Chasm

Everyone wanted something better. But, despite its faults, end-users were used to the devil they knew–the junk drawer of email and shared files–and skeptical about if and how a different collaboration solution would work.

Schalk realized that successful adoption of any new solution would hinge on users understanding why improving collaboration was critical for the company, and how better collaboration tools would help to facilitate it. She recruited different end-user groups in the company to evaluate collaboration solutions. In the process, Apex evaluated or reviewed cloud-based collaboration solutions from three major vendors, which helped to get people thinking about, seeing and talking about better ways to collaborate and get work done.

Schalk also designated a technology advocate to help end-users understand how a new collaboration solution would help streamline tasks and make their lives easier. As she observed, “My biggest ‘aha’ was understanding we needed a technology advocate. We’re all creatures of habit. People need hand-holding and encouragement to believe that there is a better solution, and show them how it can make it easier for them to share and keep track of work.”

Selecting a Solution

????????????????????????????????????????????????????????????????????Apex had decided upfront that it wanted to deploy a cloud-based collaboration solution because, as Schalk noted, “We have a lean IT staff. So the cloud gives us a way to get more value, more quickly and easily than an on-premise solution.”

“Functionality was important, but so was simplicity,” explained Schalk. “We wanted all of the collaboration tools–instant messaging, meetings, community, wikis, blogs, email, etc.–but it needed to be integrated and easy to use.” Other key factors included flexibility, support, security and backup, an easy and secure way to bring external contractors and partners into projects, and mobile capabilities.

After evaluating different solutions, Apex selected IBM’s Smart Cloud for Social Business and deployed in March 2012. According to Schalk, “The initial solution was simple to use and the pieces were well-integrated. In addition, IBM gave us great access to the product team. We felt we’d have input into product development so we’d get changes as our needs evolve.” Since the initial deployment IBM has made several enhancements; in particular, Schalk liked the direction IBM was taking with its Mobile First design point, which gave her confidence that Apex would get the capabilities it needed for a more mobile workforce and world.

She also liked that support came bundled into standard Smart Cloud for Social Business subscription pricing, and that IBM provided “corporate-grade security and backup for highly confidential new product ideas and designs.” The Smart Cloud for Social Business guest model, which lets companies set up free guest accounts for external users, was another point in its favor. “The guest model would make it easier for Apex to collaborate with contractors, suppliers and partners in a secure way,” she added.

Keeping Up With the Speed of What Customers Want

Schalk reports that with the help of the technology advocate, end-users began to explore the tool set and found benefits specific to their work groups. Since then, they have quickly begun using more of the functionality in Smart Cloud for Social Business, because “they don’t have to install anything new, its easy to use, and its all integrated.”

Apex is now better able to “keep up with the speed of what customers want.” For example, the solution is easing the roll out of Apex’s new ERP solution. According to Schalk, “People are updating the task list every 20 minutes because it’s easy. They can do work from anywhere, from home, on a tablet. Almost every other day, someone says, wow, it’s so easy to get things done with a pop-up meeting or iPad app.”

On boarding new employees in this fast-growing business has become much simpler as well. Before, people had to “hunt around to find the right info for each new hire. Now we can just point new hires to the places where we’ve published information about projects, policies and procedures,” explains Schalk.

Schalk says that employees are also using Smart Cloud for Social Business as a complement to their Salesforce.com sales and service applications. Although she would like to see the IBM and Salesforce products more fully integrated, customer support and sales teams view them as complementary, and are sharing relevant conversations and tasks between the solutions.

Perspective

Social Business People Network  inside Speech BubbleProgressive SMBs that create and sustain rapid growth are defined not only by larger IT investments, but their attitudes about applying technology to help achieve business goals.

Many SMBs recognize that effective collaboration is critical to building and growing a successful business. Taking steps to develop a more collaborative culture, such as Apex did, pave the way to getting the results you want from a collaboration solution. As the Apex story illustrates, it pays off to:

  • Focus on collaboration as a means to desired business outcomes–such as faster time to market, or faster decision-making.
  • Get people engaged in the process early on to elevate awareness and conversations about better ways to get things done.
  • Lend a helping hand–such as a technology advocate–to help users who are reluctant to change see how a different approach will make their lives easier.

This sets the stage not only for selecting the solution that will best meet your business needs, but also ensures faster user adoption and, ultimately, the outcomes you’re looking for from that solution.

This blog was sponsored by IBM Smart Cloud for Social Business to help educate small and medium businesses (SMBs) about how collaboration tools and social technologies can help their businesses.

Be the Change: Paying It Forward with Dell Women’s Entrepreneur Network

Anonymous_GenderAlthough the number of women-owned businesses is rising, women still face a steeper uphill climb than men when it comes to starting and running businesses. In the U.S., for example, women own about 30% of all non-farm, privately held U.S. firms. Women-owned businesses are concentrated in industry sectors where firms are usually smaller, and average sales/receipts for their businesses are only 25% of average sales/receipts for businesses that men own.

The gender gap is even wider in other countries. But the reasons for this gap are common across geographies. One of the most significant challenges women face is under-representation in the finance community in general, and that they are barely a blip in the venture capital investor community. Only 4 women were listed on the 2012 Midas List, an annual list of the top 100 tech investors.

Another key barrier is the fact that men continue to outnumber in science, technology, engineering and math (STEM) degrees and jobs. This is at a time when business innovation is increasingly tied to technology innovation. A 2011 report by the U.S. Department of Commerce found only one in seven engineers is female, and that there was no growth of women in STEM jobs since 2000.

Creating the Ripple Effect

But women are increasingly realizing that they can create new social and capital networks to support each other. These women are asking how can I help other women, and how can we help each other?

Dell DWEN imagesTo that end, Dell Women’s Entrepreneur Network held its fourth annual event in Istanbul in early June, which I had the opportunity to attend (thank you, DWEN, for hosting me). Since the inaugural DWEN event in Shanghai four years ago, interest in and attendance at the event has spiked. More than 150 women entrepreneurs from 13 countries and an online audience took part in this year’s conference.

As with past DWEN events, 2013 offered attendees businesses with a unique opportunity to develop relationships and grow their businesses. It featured an amazing roster of speakers who offered pearls of wisdom about how women can better leverage innovation, brand, capital and technology to grow their businesses, including:

Paying It Forward

But DWEN’s commitment to helping women collaborate and grow their businesses goes far beyond this annual event and its attendees. DWEN is taking things to the next level with several very visible, powerful initiatives. DWEN’s 2013 sums it up: Pay It Forward. Pay It Forward is the catalyst to collectively mobilize established women entrepreneurs to share their skills, experience, money and mentoring with women just starting up the entrepreneurial ladder.

pay it forward imagesAs Karen Quintos, Dell’s Chief Marketing Officer noted during opening remarks at the conference, “We’re hoping to reach 1 million women entrepreneurs by 2015.” DWEN is challenging its 10,000 members in DWEN, Dell’s Women Powering Business community and the Wise Dell team to help one million aspiring women entrepreneurs by the end of 2015.

DWEN calculates that if each woman helps at least 10 fledgling women entrepreneurs, who then go on to help 10 more women, it can reach this goal. Established women entrepreneurs can donate time, money, support and encouragement to women entrepreneurs who are starting down the entrepreneurial road.

Expanding the Circle of Trust

Like-minded organizations have joined forces with DWEN, adding more fuel to the mission. The United Nations Foundation and Girl Up, Girl Scouts of the USA and the Dell Social Innovation Challenge have stepped up to help with the Pay It Forward initiative.

Elizabeth Gore, resident entrepreneur at the United Nations, spoke at the conference, and underscored that helping more women successfully start businesses not only empowers women, but also helps children and families and communities, and ultimately, on a country’s economy.

By combining forces, these Pay It Forward charter members can amplify and multiply support to help girls and women execute on their entrepreneurial dreams and goals.

From Aspiration to Action

empowering womenDell is taking action to turn this goal into reality with its Empowering Women Challenge, a global competition to encourage university students from any country, male or female, graduate or undergraduate, from any field of study, to propose initiatives to help empower women and girls.

Launched at DWEN, the goal is to inspire at least 100 innovative ideas from around the world, a special emphasis increasing entrepreneurship in developing markets. Once Judges select the 50 semi-finalists in September, DWEN members will provide them with direct mentoring. One member from each of the top three teams will receive an all-expense paid trip to pitch their team’s idea at a special awards event in December 2013. Winners and the 10 most promising projects will share a total of $35,000 in cash prizes.

The Empowering Women Challenge is a spotlight challenge of the Dell Social Innovation Challenge, which asks university students to solve some of the world’s most pressing problems. Finalists in the Empowering Women Challenge will be automatically entered as semi-finalists in the 2014 Dell Social Innovation Challenge, Dell’s umbrella competition focused on social entrepreneurship.

Painting By Number

As former Chief of Staff to Secretary of State Hillary Clinton and DWEN panelist Cheryl Mills noted at the event, “If you wait long enough, sometimes the data catches up with what you know.”

indexDuring DWEN, Dell released the Dell Gender-GEDI Index, the first gender-focused, global entrepreneurship index based on the Global Entrepreneurship and Development Index (GEDI). The index measures high-potential female entrepreneurship based on individual aspirations, business environments and entrepreneurial ecosystems. By providing a cross-country comparison, the Index helps countries see where they are lagging so they can improve.

Gender-GEDI is made up of 30 indicators and ranks 17 countries. Research findings ranked the U.S. as No. 1 for having a solid institutional foundation and entrepreneurial environment for women. Other top-ranking countries include; Australia (No. 2), Germany (No. 3), France (No. 4) and Mexico (No. 5).

The research does in fact support what we already know: that governments need to give women access to the knowledge, networks, capital and technology they need to start a business and grow it. Social and cultural norms play a role as well. For instance, although Japan scores well in many areas, it has the lowest percentage of female managers (9 percent) compared to other countries. U.S. As a result, fewer women in Japan have the experience, skills and confidence to start their own businesses.

Perspective

whirling dervish imagesWe are finally at a point when it everyone from Facebook’s Sheryl Sandberg to Warren Buffet are shining the spotlight on the fact that although women represent 50% of the world’s human resources, they are still under utilized and under valued in the business world.

As it enters its fifth year, DWEN’s now established network can serve as a collective resource to advance the role of women in business by fostering entrepreneurship, and in turn, raising income levels and quality of life of families and communities.

Former U.S. Secretary of State Madeline Albright said, “There is a special place in hell for women who don’t help other women.” So what are you waiting for? Check it out and Pay It Forward.

Key Considerations: How SMBs Are Using Data and Insights to Get Ahead

?????????????????????????????????????????????????????????????????????????????In the first post in this series, Seeing the Light: How SMBs are Using Data and Insights to Get Ahead, I shared the motivations that prompted three SMBs (BGF Industries, Oberweis Dairy and Twiddy & Company) to replace spreadsheets and intuition with a more sophisticated, analytics-driven approach.

But what factors do you need to assess in order to select an analytics solution that will work best for your business? In this post, I examine the factors that these decision-makers view as make or break considerations to guide the analytics selection process and ultimately, drive successful outcomes.

What Information Do You Need to Understand and Measure?

As Albert Einstein, said, “The important thing is not to stop questioning.” After you’ve determined the business requirements you need to solve for, the next step is to identify the specific questions you need to answer to solve for these requirements. For instance:

  • Oberweis Dairy initially wanted to determine why customers were discontinuing home delivery service so it could get that business growing again. But the scope quickly broadened. According to Bruce Bedford, VP of Marketing, “We have three channels of business–home delivery, ice cream and dairy stores, and distribution partners. We realized we had to understand customer buying behaviors across these channels to answer questions such as, how do we increase revenue per transaction, improve customer retention, and increase market penetration.”
  • Twiddy & Co. needed to maximize occupancy and revenues for vacation homeowners while still providing an optimal vacation experience for its guests. As Clark Twiddy, Director of Operations explained, “We asked what do we want this solution to show us, and what would we do with it once we had it?” For instance, Twiddy wanted to be able to scan for safety related items so it could immediately dispatch resources to correct them. “We also wanted to track costs and performance in different vendor categories. “I wanted to know what the median cost is, for example, for carpet cleaning, what each vendor charges, and who does the best job–sort of like a private Angie’s list.”
  • BGF Industries had millions of lab testing records that it could use to improve quality control, but lacked an effective way to extract insights from them. Notes Bobby Hull, Corporate QA Manager,” We needed a system to quickly comb through all these records, generate control charts, and flag anything that might be an issue–before it becomes an issue for our customers. We also wanted to build a knowledge repository to make key findings readily available if an issue comes up again.’’

Where Will the Data Come From?

Most SMBs start with wanting to analyze internal company data. But odds are that corporate data is in different “silos,” such as an internal financials application and a cloud-based HR or CRM solution. Data silos are usually inconsistent, expensive to support and a source of contention in companies. Bringing siloed data together into an integrated data store is the foundation to build a “single version of the truth” to run reports, build dashboards, and create visual or mobile user interfaces.

BGF was fortunate. It had already built a data warehouse for its lab testing data when it decided it needed a more powerful analytics solution. But Twiddy and Oberweis faced a dilemma more common to SMBs. For example, “Our Ice Cream and Dairy Stores operate in a completely different IT environment than our Home Delivery and Wholesale businesses,” explained Bedford. “For timely, accurate reporting and analysis of cross-channel purchase behavior, we needed to start by bringing all of our consumer and inventory data together into a single data warehouse.”

Look for solution providers who can help consolidate and standardize data from different sources and formats to build an integrated, rationalized data store. This foundation will enable you to derive deeper insights, better metrics and the confidence you want from your data.

How Much Data Do You Need to Analyze?

Big data isn’t only applicable to large businesses. In fact, the “big” in big data is relative–relative to the amount of information that your organization needs to sift through to find the insights you need, when you need them.

BGF was storing over 5 million lab testing data points in a data warehouse. “Many of the solutions we looked at couldn’t handle the data volume, they would choke after a couple of million data points. We needed a solution to power through this with the speed we needed,” according to Hull.

Consider both current data volumes and what’s coming down the pike. Oberweis’ Bedford notes, “We wanted to start with market analysis, but knew that down the road that we would want also improve inventory management and gain more predictive inventory control, which would bring more data into the picture.”

It’s a safe bet that the volume and variety of digitized data relevant to your business will continue to rise exponentially. You may need to bring in new, unstructured data from company emails, from external sources such as social media, or machine generated data from processes that you automate.

Select a solution that will be ready when you need it to crunch through more data, from more places, more quickly. Analytics solutions that take advantage of new technologies, such as Hadoop and MapReduce make it possible to run analyses that used to take days or weeks in minutes, and to weave new, external data sources into your analysis as required.

How Do You Make Data Actionable?

To have value, data needs to be accessible, consumable and actionable. People must be able to interact with it, and get the information they need, when and how they need it, to perform their jobs most efficiently.

Consumability was top of mind for Twiddy & Co. “We wanted something that would not only help our executive team to make decisions, but also shape information that we could disseminate to front line managers and the field,” notes Twiddy. Executives needed planning and forecasting capabilities to help maximize occupancy for almost 1000 properties, and manage service costs among 1100 providers. “But we also needed to bring together information from different sources into one simple document for our cleaning crews who clean and inspect the homes. Our data challenges were often to make our complicated data systems clear, understandable, and most importantly actionable.”

BGF’s Hull required “a daily report of issues, divided by market segment, that segment managers could pull up and start taking actions on immediately.” BGF also wanted to augment control charts with commentary field to capture knowledge about how to resolve issues. “One of my mentors recently retired with 52 years of service. When someone like that logs something, you want to keep it and pass that knowledge on in case the issue comes up again.”

Get clarity around who needs to use the data and how. Is it executives, front line managers, people in the field–or all of the above? Business users may need visualization capabilities to make it easier to explore large amounts of data. Executives might want mobile solutions so that they have information at their fingertips at the airport. Get broad input from stakeholders upfront to deliver information in the most actionable format.

What Internal Capabilities Do You Have and What Help Will You Need?

Like most SMBs, these companies had small IT staffs, ranging from 2 to 4 full-time people. They had varying degrees of analytics expertise. Oberweis’ Bruce Bedford is a PhD and an analytics background. BGF’s Hull had experience with desktop analytics, but had to juggle his day job as Corporate Quality Assurance Manager while implementing a server-based solution. And Clark Twiddy had to help move the company off spreadsheets while fulfilling his duties as Director of Operations.

If you lack IT staff and/or in-house analytics expertise, select an experienced solution provider who can fill in the gaps with consulting, implementation, training and support services. Since analytics is major investment for most companies, and your requirements will evolve over time, look for a provider that will really listen to what you are trying to do, work with you to overcome internal challenges and constraints, and provide a solution that will grow with your business. “Don’t be over-confident about simply buying a solution…in hindsight, we should have purchased a training plan and initial setup consultant upfront. It would have saved a lot of time.”

Perspective

With all the hype surrounding analytics today, it’s easy to get derailed from your objectives by buzzwords and the next new feature. But you can stay on track if you remember that the end goal of all metrics, reports, dashboards, alerts or any other features that an analytics solution provides is to answer your business-critical questions.

Evaluating key questions at the front of the solution assessment cycle proved critical to enabling these SMBs to choose the analytics solutions and providers that would be the best fit for their companies.

If you take time upfront to lay the groundwork with a thorough internal assessment, you will dramatically increase the odds of selecting an analytics solution and solutions provider that will help you get the insights you need to grow the business and stay ahead of the competition.

In the third and final post of this series, I’ll look at how careful planning paid off for these three SMBs, and how they are using analytics to help their companies grow.

This is the second of a three-part blog series by SMB Group sponsored by SAS that examines why and how SMBs are moving from spreadsheets and intuition to a data-driven approach to grow their businesses.

Top SMB Takeaways: SAP Sapphire 2013

sapphireA couple of weeks ago, I had the opportunity to attend Sapphire 2013, SAP’s annual user conference. As is the norm for these events, SAP opened the fire hose to reveal new directions, product and solution announcements, and partner and customer wins through a myriad of meetings and sessions.

Rather than attempt to drench you with the full blast, I’ll focus this post on what I see as most relevant for SAP’s direction in the small and medium business (SMB) space.

HANA for All

SAP HANASAP is betting big on its HANA platform, which began life in 2010 as an in-memory database and has quickly evolved to become SAP’s “development platform for innovation,” for both SAP and third-party developers.

At Sapphire, SAP underscored that HANA isn’t just for big business. The vendor discussed several initiatives to bring the benefits of HANA’s data-crunching power to SMB analytics and online transaction processing (OLTP) requirements. For instance:

  • SAP Business One on HANA. Business One is SAP’s ERP solution for small businesses and for departments in larger companies. The solution integrates core business functions, including financials, sales, customer relationship management, inventory, and operations, and includes embedded analytics and reporting capabilities. SAP offers Business One both as an on-premises offering or via a cloud-based subscription model. In September 2012, SAP announced SAP Business One analytics, powered by SAP HANA. This solution provides a Linux-based HANA analytics appliance for companies running SAP Business One on a Windows server with Microsoft’s SQL database. At Sapphire, SAP introduced a new offering, Business One, version for HANA,  slated for availability later this year. This version runs directly on HANA, enabling both the transactional (ERP) and analytical applications to run on the same Linux-based server. By running both ERP transactions and analytics on a single platform, Business One version for HANA speeds access to information for analytics, reporting and search, without slowing down transactional processing.
  • SAP Startup Focus Program, which enables startups to build solutions for small businesses. SAP has engaged over 430 startups to use HANA as a platform to develop user-friendly real-time analytics and advanced predictive solutions. For instance, Vish Cancron, CEO of Liquid Analytics, talked about his company’s cloud-based, mobile analytics applications for iPhone, iPad, Blackberry and Android users.  As Vish explained to me in this video discussion at a prior event, Liquid Analytics uses gamification and predictive analytics to help make it easier, quicker and more fun for wholesale industry sales reps to place orders and set and meet sales goals.
  • SAP HANA One. SAP has partnered with Amazon’s Web Services Cloud to offer a pay-as-you model for trying and using HANA. SAP claims that users can import data and get up and running with HANA cloud in as few as 5 minutes. HANA One is designed for analytics professionals, SIs and ISVs, supports up to a 30 GB compressed data set, and is priced at one dollar per hour per user. While most SMBs don’t have analytics professionals, HANA One gives SIs and developers an accessible, affordable mechanism to develop and test new HANA apps for SMB customers. SAP has also created an online and community support network to help SMBs get started and navigate their way through a HANA One instance.

Cloud Front and Center

sap cloudSAP’s journey to the cloud has been underway for several years. Though the company has seen a few setbacks, almost all of SAP’s solutions are now available in the cloud, including:

  • Home-brewed SAP ERP solutions such as Business One, Business All-in-One, Business Suite  and of course, cloud-only Business ByDesign.
  • Acquired cloud solutions such SuccessFactors and Ariba.
  • Afaria, SAP’s mobile management platform, which SAP announced at the event is now available as a cloud-based service, branded as Afaria in the Cloud.
  • SAP HANA One Premium, an advanced version of SAP HANA One with the same data compression rate but with greater accessibility to SAP source data, all SAP backend systems, data integrators and full SAP Support.

SAP also offers customers a choice of running some of its ERP solutions in either a public or private cloud environment, and a choice of cloud providers as well. For instance, customers can choose to run Business One in Amazon’s AWS, or in SAP’s HANA cloud center, an SAP partner’s cloud, or in a private on-premises cloud.

Notably, SAP revealed that it’s own HANA Cloud Center has the capacity to accommodate all of its current installed base customers. This gives existing customers a convenient on ramp both to move ERP solutions to the cloud and gain the power of HANA in one fell swoop–and underscores just how important the cloud is to enable SAP’s HANA strategy.

Upgrading the User Experience

sap uiLet’s face it, SAP is not known for user-friendly software or contracts. But the company is on a quest to improve customer experience by making its solutions more accessible and user-friendly. SAP is also expanding its portfolio of rapid deployment solutions (RDS), which offer fixed cost, fixed scope preconfigured software, best practices and implementation services that give customers everything they need to get up and running on midmarket solutions such as Business All-in-One in just a few weeks. SAP currently offers over 900 rapid-deployment solutions across its product lines. In addition to developing more appealing and streamlined user interfaces, SAP is trying to simplify pricing and contracts.

When it comes to new solutions, SAP is aiming to get accessibility and ease of use right from the get go. For instance, SAP’s newly minted Afaria for the Cloud solution for mobile management sports a streamlined user interface and is priced at 1 Euro per user per month. At that price, the solution should be attractive for even very small businesses that need to manage mobile devices get an affordable solution. It also opens the door for SAP to prove its worth, develop a relationship, and sell other solutions to new small business customers.

Shining the Spotlight on Ariba

aribaAttracting new customers, growing revenues, and increasing profitability are perennial challenges for all SMBs. As revealed in SMB Group’s 2012 SMB Routes to Market Study, about one-quarter of SMBs sell goods and services to large enterprises. These B2B SMBs want a bigger share of the billions of dollars that large businesses spend annually on goods and services. SAP is shining the spotlight on its Ariba business commerce network as a means to help them reach this end. SAP provides all of its Business One customers with a free connection into the Ariba network, and any company, whether an SAP customer or not, can enroll as a Supplier on the cloud-based Ariba Network. Once enrolled, SMBs can connect and collaborate customers, partners, peers, and prospects. Ariba gives SMBs another way to provide more value to its existing SMB customers, and an additional entry point to bring non-SAP SMBs into the SAP fold.

Perspective

We’ve all seen how quickly innovative, fast-growth start-ups can become marquee brands. SAP understands that the creation-destruction cycle for businesses in hyper-drive, as underscored by the story of Under Armour, a featured customer and keynote panelist at Sapphire. Kevin Planck, Under Armour CEO, discussed how he founded the company in his basement in 1996 to design T-shirts that would wick moisture to help athletes stay cool and dry. He also talked about how Under Armour has evolved and grown, and how SAP has helped the company achieve twelve consecutive quarters of 20%+ growth.

SAP is betting big on becoming the leading IT solutions provider for these high-growth SMBs, which SMB Group call Progressive SMBs. Progressive SMBs are growth driven, and more likely to invest in and use technology to gain market and competitive advantage than other SMBs. Our data shows that Progressive SMBs are also much more likely to anticipate revenue gains than peers whose tech investments are flat or declining. SAP’s strategy to target  Progressive SMBs with leading edge technologies that provide clear business benefit should help it to tap in more deeply to this segment.

As important, SAP seems to be making an authentic effort to consumerize the SAP experience by reducing friction in choosing, buying and using SAP solutions. In our 2012 SMB Routes to Market Study, 42% of small businesses rate “solution is easy to use” as the top reason to put solutions on their short lists. SAP is addressing this challenge with a commitment to the cloud, tight integration to HANA within business applications, and focus on bringing new, easy to buy and use applications to market.

Although SAP isn’t likely to become the volume leader, the company is charting a leadership course to engage fast-growth SMBs–who also have the potential to become high-value SAP customers–with a differentiated and compelling story.

Seeing the Light: How SMBs Are Using Data and Insights to Get Ahead

At a time when information is proliferating at an unprecedented rate, companies that effectively gather, create and use information can gain dramatic market advantages over those that don’t.  SMB Group’s 2012 Routes to Market Study shows that SMBs that have deployed business intelligence and analytics solutions are 51% more likely than peers to expect revenues to rise. Likewise, in a survey from the MIT Sloan Management Review and SAS Institute, 67% of respondents report that their companies get a competitive advantage through analytics.

Most small and medium business (SMB) decision-makers understand this at a conceptual level. But let’s face itfew have in-house business analysts and data experts. Consequently, it can be daunting just to think about moving beyond spreadsheets to a more innovative analytics-driven approach.

A Tale of Three SMBs

But it doesn’t have to be. In this three-part series, I explore the journeys that three SAS customerswithout armies of IT peoplehave taken to get more accurate, timely, usable insights for their businesses. And note: not one is a venture-backed tech or digital media start-up from Silicon Valley! In fact, all three are from traditional industries, with a combined 146 years of history behind them:

  • BGF Industries is a leading manufacturer of 2,000 high-performance Kevlar, fiberglass, and carbon products used in industries such as aerospace, marine, filtration, automotive, and ballistics. BGF was the first weaver of fiberglass textiles in 1941 when it was part of Burlington Glass Fabrics, and became a subsidiary of the Porcher Groupe of Badinieres, France in 1988. Today, BGF employs 800 people at six facilities in three states. With over 35 patents for specialized finishes and processes, BGF’s mission is to deliver excellent products and exceptional customer experience.
  • Oberweis Dairy began in 1915, when Peter J. Oberweis had too much milk and started selling it to neighbors. The Oberweis family began delivering fresh milk to homes on horse-drawn carts in 1927. Now, Oberweis continues its “Simply the Best” tradition as a family owned and operated business in Aurora, IL. Oberweis has also significantly expanded its product line, and opened 47 retail stores where customers can buy milk and enjoy its ice cream. It still delivers milk in glass bottles, although today it uses trucks instead of horses.
  • Twiddy & Company manages a portfolio of individual, privately owned vacation homes on the Northern Outer Banks of North Carolina.  Family owned and operated, Twiddy & Company employs 110 people year round and almost 500 during peak vacation season. Although the vacation rental market has changed over the years, Twiddy’s mission has remained constant throughout its 35-year history: Offer the very best selection, service, and successful experiences to both homeowners and guests. 

This post chronicles why these companies decided to bring more robust analytics capabilities into their organizations. In the second, I look at the key considerations that came into play in their search for a solution and how they decided which solution to use. The third post examines how analytics are helping their companies thrive and grow.

Triggers for Change

The vast majority of SMBs use spreadsheets and intuition for analysis and decision-making, even as spreadsheet errors proliferate, time is wasted, and trends are missed. So what drives some SMBs look for alternatives to “spreadsheet management”?

This quote from Albert Einstein sums it up nicely: “We can’t solve problems by using the same kind of thinking we used when we created them.” Faced with an “aha” moment that they could no longer ignore, each of the three companies we spoke with decided it was time for a change.

Creating a Competitive Edge with Better Owner and Guest Services

Wild Horse AerialIn 2009, Clark Twiddy, Director of Operations and son of founder Doug Twiddy, came home to the family business after serving in the Navy. He saw that Twiddy & Co. was “swamped in transactional data. We rent 900+ properties 25 times a year, with multiple and varied service transactions every week on each unit. We struggled to keep up with delivering great service to homeowners and guests.”

Twiddy must keep track of many variables. It needs to ensure each property is clean, safe and serviced properly for each visitor; optimize occupancy and rates for property owners; and negotiate better pricing from plumbers, carpet cleaners, electricians and other service providers.

As big, nationwide rivals entered the market, Twiddy recognized that “getting our information faster, more valuable, and easier for people who needed to act on it right away” was critical to the company’s future. “Keeping track of all the variables with Excel proved problematic. People sat behind desks and researched data for hours or days trying to find trends or just answer pretty simple questions.  For example, it was too easy to get blindsided because we didn’t spot a safety issue that should have been addressed.  The risks of unmanaged data became something we had to act upon.”

PrintStabilizing and Growing the Flagship Business

Survival of the home delivery business triggered a fresh look at alternatives at Oberweis Dairy, According to Bruce Bedford, VP of Marketing, “In 2010, we recognized that we had to stabilize and grow our flagship home delivery business, which accounts for about a third of revenues. We had to understand why customers would discontinue the service, and then take corrective marketing action to turn that around.”

At the time, Oberweis was using “very complicated” Excel spreadsheets, Visual Basic macros and pivot tables. “Although best efforts were made to figure out what was happening, it wasn’t cutting it,” explains Bedford.

Preventing Costly Process Errors

BGFCorporate QA Manager Bobby Hull and other managers at BGF had relied on individual, PC-based versions of SAS to monitor data and processes. As Hull noted, “That worked for a while, but we were growing so much, we had so much product diversity, the customer base and their demands were changing. We had to be quicker, better, faster, leaner and deliver higher quality.”

In the mid-2000s, a customer spotted a trend in a BGF product that Hull says, “We should have spotted ourselves. We had all of the information in our systems, we measured everything we could measure, but we had no good way to extract and use it.”

After investigating the issue, Hull notes that, “In hindsight, pulling the data out after the fact and looking at it, the trend was there…we should have spotted that. It was scary…these are technical fabrics going into complex, high-end industries and you can’t afford to drop the ball because it can get expensive really fast.”

As a result, BGF decided they needed “a serious way to dig into information quickly, easily and to surface it. We’d invested so much money to collect the information, but its dead money unless we do something with it.”

Perspective

Data is the new business capital. But just like financial capital, you have to invest wisely to reap value from it. As these three customer stories illuminate, making the investment to move beyond spreadsheets to an analytics-driven approach generates a very positive return on investment for the business.

Is it time for your business to make this investment? Think about what keeps you up at night. Can you put your finger on the pulse of information about operations, customers and processes–when, where and how you need it? Is your business out in front of customer trends, or playing catch up? Are you able to spot potential problems before they result in lost revenues and/or brand damage? How would you reimagine your business if you could take the pulse of key metrics more readily and easily? Thinking through the answers to these questions will help you answer this question and chart a more effective course to using data to make better business decisions and gain market advantages.

The next step is to assess internal capabilities, desired outcomes, and what you’ll need from a solution provider to reach your goals. In the second post in this series, I’ll discuss how BGF, Oberweis and Twiddy tackled this crucial phase.

This is the first of a three-part blog series by SMB Group and sponsored by SAS that examines why and how SMBs are moving from spreadsheets and intuition to a data-driven approach to grow their businesses.

 

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