(Originally published on the SMB Group website and available here in .pdf format).
Here are SMB Group’s Top 10 SMB Technology Trends for 2015 in slide show format!
(Originally published on the SMB Group website and available here in .pdf format).
Here are SMB Group’s Top 10 SMB Technology Trends for 2015 in slide show format!
(Originally published on the SMB Group website and available here in .pdf format).
Here are SMB Group’s Top 10 SMB Technology Trends for 2015! A more detailed description of each follows below.
(Note: SMB Group is the source for all research data quoted unless otherwise indicated.)
About SMB Group
SMB Group focuses exclusively on researching and analyzing the highly fragmented “SMB market”—which is composed of many smaller, more discrete markets. Within the SMB market, SMB Group’s areas of focus include: Emerging Technologies, Cloud Computing, Managed Services, Business and Marketing Applications, Collaboration and Social Media Solutions, IT Infrastructure Management and Services, and Green IT.
Filed under: Uncategorized | Tagged: analytics, BI, big data, channel, cloud computing, data protection, future of work, integration, Internet of Things, IoT, KPI, mobile, SMB Top Trends | Leave a comment »
I recently had the opportunity to attend SuiteWorld 2014, NetSuite’s annual user conference—along with about 6,500 attendees including customers, partners, journalists and analysts. The event provided us with a good mixture of history, progress, new announcements, and future directions.
I’ve been following NetSuite as an analyst since 1998, when Evan Goldberg (still serving as NetSuite’s CTO) and Mei Li (now SVP NetSuite Corporate Communications), first came to Summit Strategies, where I worked at the time. Early on, NetSuite was NetLedger, offering a simple accounting solution geared towards small and medium businesses (SMBs). The term “cloud” hadn’t yet been coined to describe the model of delivering software as a service (SaaS). In fact, even the SaaS term hadn’t surfaced. Back in the day, we called them Application Service Providers (ASPs) or just online solution providers.
NetSuite was one of a just a handful of vendors that came to pitch this new software delivery method to us in 1998. Salesforce and Employease (long ago acquired by ADP) and maybe a few now defunct vendors probably rounded out this tiny group. Of course, in the next couple of years, we were flooded with visits from seemingly anyone with a similar ideas that could create a PowerPoint presentation.
Over the past 16 years, many cloud vendors have come and gone, as for the most part, the road to the cloud has turned out to an evolutionary–not revolutionary–journey. Mainstream customer adoption of cloud solutions only started to become a reality in 2008, when the “great recession” hit, and the OPEX cloud model became much more attractive to cash-strapped companies. Looking at NetSuite specifically, I remember that for quite a few years in there, the vendor seemed stuck at a count of 5,000 active customers, and some wondered if it could ramp up to the next level of growth.
Today, while some roadblocks remain, many companies view the cloud as a mainstream approach to get the solutions they need to run their businesses. In fact, in some areas, such as collaboration and marketing automation, SMB plans for cloud adoption are higher than for on-premise.
Figure 1: Current and Planned Solution Deployment Methods Business Applications
However, financials and ERP—NetSuite’s flagship solutions—have moved more slowly to the cloud than other types of applications. There are many reasons for this, including:
Furthermore, the cloud has made it easy for business decision-makers to adopt new apps as needed, without IT involvement or even centralized corporate oversight. NetSuite has always focused on the value of a single, integrated system of record—certainly a longer, higher up the food chain sell than buying other types of solutions.
Despite these challenges, NetSuite has successfully stayed the more challenging course, and more companies are coming around to the value proposition that integrated solutions help remove friction and streamline business processes. For Q1 2014, NetSuite announced a record $123 million in revenue, up 34% year-over-year, and more than 20,000 organizations now use NetSuite to run their businesses.
At SuiteWorld, NetSuite showcased its 2014 Transformer Award winners, including Tableau Software, Jive Software, Shaw Industries, Williams-Sonoma and MusclePharm, to illustrate how NetSuite helps them grow and manage change more effectively. But their stories reflect a broader phenomenon. I’ve personally talked to many customers—and not only from NetSuite’s ranks—about how much better business runs when everyone views and works with the same, real-time information.
Over the years, NetSuite has added integrated CRM, Ecommerce and other areas to its unified platform. At SuiteWorld 2014, NetSuite not only announced a new, improved user interface, but additional integrated offerings including:
NetSuite has also come to terms with the fact that one company can’t possibly develop ALL the functionality every company will need, or sell and service all of its potential customers. To that end, NetSuite is bringing more partners into its fold to fill in the white space and provide its customers with a richer ecosystem.
For instance, over 100 developer partners had booths and/or conducted sessions at SuiteWorld. The mix included established vendors such as Avalara, DocuSign and Kronos, to newer entrants such as FieldAware and VertexSMB, all of whom have developed integrations with NetSuite.
On the sales channel side, partners ranged from enterprise-focused players, such as CapGemini and Accenture, to smaller ones such as Cloud ERP (which has built its Australia/New Zealand-based business around selling and supporting the full range of NetSuite solutions), and FHL Cloud Solutions, which has developed a successful micro-vertical approach to marketing and selling NetSuite in industries such as wine, medical devices, and furniture wholesale and distribution.
NetSuite also launched the NetSuite BPO Partner Program at SuiteWorld. Through this program, NetSuite and its partners intend to simplify the outsourcing model and help drive costs down and better server smaller customers. Partners who provide Business Process Outsourcing (BPO) or Business Process as a Service (BPaaS) use NetSuite’s unified solution platform to provide services to their clients. Partners get access to SuiteCloud, NetSuite’s development platform to tailor their NetSuite offerings to industries or client-specific needs. Early partners include Capgemini, McGladrey and Accretive Solutions.
Integration helps bring order to chaos–and helps companies reap more value from their application investments. But let’s face it, integrating applications after the fact is a difficult, messy and expensive affair, and one that many SMBs struggle to get done.
In today’s social, mobile and multi-channel world, consumers—whether B2B or B2C—have more power, and all vendors face increasing pressure to provide better, faster, and more user-friendly products, services and engagement to attract and retain customers. Having a unified system of record enables companies to have a more knowledgeable view of customer behavior, and to present a more unified face to customers, whether they’re engaging in marketing, sales, billing or service transaction. This means that the appeal and value of taking an integrated approach will only rise—as will NetSuite’s fortunes.
Earlier this week, I had the opportunity to meet with Kevin Gilroy, SAP’s Senior VP and GM for Global Small and Midsize Enterprise Segment & Indirect Channels to hear about SAP’s plans to go big in the small and medium business market, which SAP refers to as small and medium enterprises (SMEs). In a nutshell, the vendor is dramatically ramping up market, channel and solution initiatives to boost its profile and market share in SME.
These initiatives come with an interesting twist. Much of what SAP intends to do in the SME space will focus on recruiting partners—from both developer and VAR ranks—who can provide start-up millennial businesses with next generation solutions to help them grow at lightening speed.
The company claims that it is coming at this from a position of strength, with 80% of its 253,000 customers coming from the SME ranks. But, SAP’s defines SMEs, as companies with revenues under $1 billion, which skews larger than how most vendors and analysts define it. So what shape will SAP’s new SME initiatives take?
To put things in context, SAP’s courtship of SME isn’t new. As I discussed in Top SMB Takeaways: SAP Sapphire 2013, SAP has been sharpening its SME lens for a while. Last year, the vendor announced several new programs to bring the benefits of HANA’s data-crunching power to SMEs, provide customers with the choice of running its solutions in public, private or hybrid cloud environments, and to make its solutions easier to buy and use.
As I noted in that post, SAP was focusing these initiatives not at the SME masses, but on high-growth SMEs, 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.
Now, SAP is further sharpening the lens to zero in on millennials that are starting, running and making decisions in SME companies. According to Gilroy, millenials have a different view on technology than older counterparts. They are more comfortable with technology, and more likely to view it as a growth engine, instead of as a cost-cutter.
With a broad portfolio of cloud, mobile, analytics, ecommerce, talent management and ERP solutions, SAP offers many entry points for these SMEs. The vendor has made some key acquisitions, including Ariba for ecommerce, and Success Factors for talent management, that broaden its footprint in the born on the cloud solution space. SAP has also introduced cloud-based options for many of its traditional on-premises solutions, such as SAP Business One. SMEs often prefer cloud solutions because they can usually be deployed faster, with less technical expertise and without big upfront capital expenditures, paving they way for SAP and its partners to expand their addressable market.
Furthermore, SAP is infusing HANA into its SME offerings, announcing general availability of the 9.0 version of the SAP® Business One application, version for SAP HANA. This is the first business management solution for SMEs running on SAP’s in-memory HANA computing platform. It enables SMEs to analyze structured and unstructured information within seconds instead of days, and use predictive analytics to gain new insights into data and optimize business decision-making.
SAP is powering up partner recruitment to fuel SME expansion. The vendor recruited 500 partners in 2013, growing the partner base to more than 11,500 worldwide, with about 1,000 in the U.S. Gilroy indicated that SAP is planning for double-digit channel growth, but will take a selective recruiting tack. In addition to looking for partners with a next-generation development vision, such as Liquid Analytics, SAP wants partners that are ready to scale their businesses to keep pace with SAP’s double-digit growth in SME.
The vendor has introduced and refreshed several programs to help partners go to market more effectively, including:
We’ve all seen how quickly innovative, fast-growth SMEs can become marquee brands, from tech sector stars such as LinkedIn to consumer brands such as Green Mountain coffee . SAP sees this too—and that technology is putting the creation-destruction cycle for businesses in hyper-drive.
So SAP’s big bet on becoming the leading IT solutions provider for these high-growth SMEs makes sense. As important, SAP is making an authentic effort to consumerize the SAP experience by reducing friction in choosing, buying and using SAP solutions.
But in this noisy SME space, crowded with competitors coveting the same high-growth SMEs, SAP still needs to do more to dispel the long-standing myth that SAP is only a big business brand. Although SAP solutions may be a good fit for high-growth SMEs, the vendor isn’t a household name with them or the millenials that its is seeking out.
SAP will also need to be cautious not to overplay the millennial hand. While millenials are likely to be more digitally savvy than older generations, the U.S. Small Business Administration says that self-employment among younger age groups has actually been dropping. From 2005 to 2010, self-employment among individuals age 25 and under decreased 19 percent, compared to a 7 percent drop in the overall population. In reality, self-employment rates increase with age. For example, they were 2 percent for those 25 and under and 23 percent for those 65 and over in 2010. Simply stated, while millenials may prove to apply technology in business in more innovative ways, they are a relatively small part of the entrepreneurial population.
However, SAP is moving in the right direction. As it increases its investment to understand and engage with SMEs, SAP can continue to fine-tune its SMB story, and widen the circle of high-growth SMEs that will hear it and relate to it.
Dell’s journey to transform itself from a hardware company to a solutions vendor has been ongoing for a couple of years. To achieve that, the company has been acquiring, building and blending hardware, software, services, cloud and open standards to broaden its technology footprint. But, much of Dell’s progress has been buried in the drama of the fight to take the company private.
As the first major event since the company’s tumultuous–but ultimately successful–struggle to go private, Dell World 2013 promised to be somewhat of a bellwether. Would Dell, newly freed from Wall Street’s constraints, reframe itself as innovative, end-to-end solutions provider?
Of course, one event won’t change things overnight. But Dell is off to a good start. At Dell World, the company unleashed, unveiled and underscored a comprehensive, innovative vision for its future. If you still view Dell as a stodgy hardware provider, here are six things it is doing that may surprise you–and prompt you to look at the company in a new light. Consider that Dell is:
Summary and Perspective
Maybe as important as the collective weight of all the announcements offered at Dell World 2013, Michael Dell deserves high praise for not only retaining so many employees, but for inspiring staff to stay the course through the trials and tribulations of the privatization process.
As Dell stated in his keynote, “I feel I’m part of the world’s biggest start-up.” His attitude seemed to be contagious among employees, creating a sense of excitement that I hadn’t seen at the past two Dell World events. This renewed commitment and energy from within is the essential first step to a successful transformation, and getting customers and the broader market to view Dell in a new light as well.
Disclaimer: I attended Dell World as an invited media guest.
Laurie: Hi, this Laurie McCabe from the SMB Group, and in today’s SMB Spotlight I’m speaking with John Mason, who is IBM’s new General Manager and VP for Midmarket. Hi John. Thanks for joining me on this two-part discussion about developments at IBM in the midmarket and SMB space. In our first discussion, I’d like to focus on the IBM acquisition of SoftLayer, which I understand provides dedicated hosting, cloud computing and cloud services offerings.
Before that though, I’d like to learn more about you and your background. I understand you’re relatively new to IBM. Can you tell us a little bit about where you’ve been and what kind of experience you bring to your role?
John: Thanks Laurie. I appreciate the opportunity to speak with you. I joined IBM three months ago. I started my career at Compaq in the 80s. I spent thirteen years there and moved to Cisco, and ran the SME and midmarket business with Cisco in Europe, Middle East, Africa.
Then, I ran global channels for Nokia’s Enterprise business. I also ran a mobile cloud service in eReading and News for a couple of years, and a white label mobile messaging service provider that had been acquired during my time there.
So, when the discussion started with IBM, it was an interesting combination of different hardware, software and services businesses in small and midsize enterprise and across mobile and social. It was the opportunity to combine that with IBM’s amazing global reach in over 170 countries and find ways to get that to the millions of small and midsized companies. Many are possibly not even doing any business with IBM today but can benefit from those solutions.
Laurie: What will you be focusing on in your new role as GM, John?
John: Finding new opportunities to grow the business and bring mobile and social and analytics, and particularly cloud solutions to small or midsized businesses. This means working very closely with our partner organization and focusing on MSPs as the key route market.
Laurie: Thanks for that background. So help me understand a little bit about the SoftLayer acquisition and why it’s so important. IBM makes a lot of acquisitions in general, and I think probably at least a dozen in the cloud area. What makes SoftLayer stand out for IBM?
John: This is one of those few times in our industry where there’s an absolutely fundamental shift that changes everything. When client-server computing started taking off was one, and when mobile really went to a whole new level was another. Now, with cloud, we’re seeing a major shift, which is very beneficial to smaller and midsized companies. They may not have the IT expertise in-house to take advantage of some of the technologies that larger companies are able to use, but now through cloud, they can use more advanced solutions without having to deal with the complexities.
Laurie: Tell us about what SoftLayer does and how that will help IBM help SMBs? What does it give IBM you that it didn’t have in the cloud area?
John: The SoftLayer acquisition was driven by a change in the way that customers are looking to buy. I would say it’s as simple as answering these questions. Is this technology solution is going to be hosted at your place or mine? Is this something that I have to build and manage on my premises, or is it something that I can tap into through a web browser to connect to infrastructure that’s sitting somewhere else outside of my physical office buildings? Then, is that going to be dedicated to me or is it something that I share with somebody else? So, it’s really your place or mine, shared or dedicated, and what software brings is the ability to offer the full range of different deployment options.
That’s whether it’s a complete public cloud solution or it’s a private cloud or it’s some mix of some parts public, some parts private in a hybrid deployment. SoftLayer lets us accelerate our ability to deliver those pieces across a broad range of different businesses and different services.
Laurie: What about purchasing and pricing mechanisms for customers?
John: Yes, that’s really key. It’s really important to make it easy and simple to understand what the offering is, and how can I choose the combination that is right for me. Then make it really easy for them to purchase and deploy that solution.
The beauty of SoftLayer is they have a very simple credit card purchase capability. You can be up and running literally within the hour and choose whether you want to be billed monthly or hourly. It’s simple and flexible, and that’s as important as the underlying technology.
Laurie: One of the other things that I’m curious about is that it seems like managed services is another big part of the SoftLayer business. IBM has been heavily courting managed service providers (MSPs) for quite some time. Does this create a conflict with them?
John: SoftLayer is really complementary to what we’re doing with MSPs. In fact, we’ve had a number of key wins with MSPs for SoftLayer with service providers who have said, “I really don’t want to have to manage this infrastructure myself. It’s not my core business. My focus is on security services or hosted exchange services. So, rather than me scarce resources building and managing an infrastructure layer, I’d rather focus on the higher value services on top of that, and I’ll use SoftLayer as infrastructure.”
Laurie: Will they be able to resell SoftLayer?
John: Yes, there’s that too. MSPs can use SoftLayer themselves as part of their own infrastructure, or they can resell it to customers together with other value-add services that they bring to the mix.
Laurie: Where does SoftLayer sit in terms of IBM’s SmartCloud services?
John: SoftLayer gives us the ability to accelerate our own leadership position, scale out the smaller cloud service portfolio, add additional higher value services and solutions across mobile and data analytics, social–together with partners. It’s the combination of all of that into a solution that adds value for customers.
Laurie: What kind of experience in SMB and midmarket does SoftLayer bring that IBM can leverage, and how will you do that?
John: I mentioned this earlier in our conversation when we talked about what attracted me to the role at IBM. Frankly, the SoftLayer acquisition hadn’t closed but had been publicly announced. That was a real additional level of credibility that we could use to address the SMB market because SoftLayer had over 20,000 SMB customers already. They clearly have a very strong focus on that market and a solution that is very simple, easy for the smaller customer to understand, choose, purchase, deploy and operate.
So, to me that said IBM’s not just talking about the midmarket, but actually putting a significant investment in technologies, ease of purchase and deployment to enable this. SoftLayer convinced me that we very serious about this and that was a decider for me.
Laurie: What does the bigger go to market plan look like? Many SMBs still think IBM doesn’t have solutions that are relevant for them. How are you going to change that?
John: First, we need to be careful that we don’t hug SoftLayer to death. We need to give them space to continue to operate their own very successful go to market model. There’s always a risk when a big company acquires a smaller company that sometimes the big company process can slow down the smaller company. We will be very diligent about ensuring that doesn’t happen and that SoftLayer continues to operate somewhat independently with their existing go to market model.
At the same time, we need to take advantage of what they bring and combine that with IBM’s traditional business partners, managed service provider partners, and some of the ISVs that we work with. Really, this is more about connecting the ecosystem that needs to work together to deliver solutions to small and midsized companies. SoftLayer helps us accelerate that with a full range of all types of different deployment options–everything from bare metal dedicated servers, virtualized shared servers, managed private and public cloud through to a full range of storage and networking and managed services.
Laurie: So, what does success look like here if this all goes according to plan?
John: I think we’ll see continued acceleration of cloud adoption within small and midsized companies and SoftLayer will help to significantly accelerate the deployment of both hybrid private and public cloud solutions for small and midsized companies. I certainly expect the 20,000 existing SoftLayer customers will increase significantly without putting a specific number on it. Beyond that, it’s about helping MSPs to accelerate their offerings with more value-add services above and beyond the infrastructure layer. That way we really bring complete solutions for small and midsized companies that are simple to deploy and use.
Laurie: John, thank you for joining me, and I look forward to our next discussion, when we will talk about IBM’s other new plans for SMB and mid-market customers.
John: Thank you Laurie. I appreciate the opportunity to have this discussion and certainly look forward to future discussions we’ll have.
This is the first of a two-part SMB Spotlight interview with John Mason, IBM’s General Manager and VP for Midmarket, sponsored by IBM. In the second post, I’ll ask John about other new IBM strategies and developments for SMB and midmarket companies and channel partners.