Laurie: Today I’m talking to Prasad Raje, president and CEO of a new company called StatX. I met Prasad this fall at Intuit’s QuickBooks Connect Conference, and was intrigued with the demo I saw of the StatX solution, which provides users with a mobile dashboard for QuickBooks Online and several other top small business applications. Before we talk more about the StatX solution, Prasad, can you first tell me a little bit about the company, and when and why you got started?
Prasad: Thanks, Laurie, sure. StatX has been around since about the middle of last year. I and my co-founder Pablo Bellver founded the company. Prior to that, I was CEO of Instantis, a company that was also in the collaboration space, and was acquired by Oracle. Pablo had been at Google for about 10 years, and had built Google Now, which is a very successful Android app for consumers. We put our brains together and created StatX to deliver mobile relevant business updates to your mobile phone, no matter where they are. Our motto is that StatX lets you know what changed in your business via your mobile device
Laurie: I like the term you used in our earlier conversation–that StatX is like an Instagram for business–because it relays real-time information to you in a very digestible way, right to your phone
Prasad: That’s right, that’s the way we think about it. We want the information to be visual and easy to consume, so we built the StatX platform to do this. It doesn’t take up too much of your time because that’s the way people use their mobile devices.
Laurie: One of the top applications that StatX works with is QuickBooks Online. Can you tell us a little about this?
Prasad: Sure. If you use QuickBooks Online (QBO) to keep your books up to date, you want to be able to send updates and financials to your clients or co-workers. StatX directly connects to QBO. QBO authorizes StatX to fetch your financials from it, and StatX pulls that information into a set of visual elements that we call stats. Twitter invented the tweet, and StatX has invented the stat, which is a visual representation of numeric or status information. In the case of financials, it would represent things like income, expenses, cash, AR, AP, etc., in a beautiful, easy to consume dashboard. And it brings you live, real-time updates to information when it changes.
Laurie: How long does it take for a QuickBooks Online user to get productive with this?
Prasad: Very little time. We want to compete with the best of the consumer apps out there in terms of ease of use. So, if you are an accountant that wants to set up QBO with StatX, it should take no more than a few minutes of time to connect your QBO account and start seeing live data on your phone from QBO. From there it should take less than a minute to share that information with your client. By the way, the client doesn’t need to do any setup, they simply just consume the live dashboard information that you provide to them.
Laurie: It sounds like the accountant does a tiny bit of work and the client gets the benefit of that without really any heavy lifting at all.
Prasad: Exactly. Even for the accountant, it’s a one-time setup, then we do all the work on an ongoing basis to keep it live at all times.
Laurie: How do you price StatX?
Prasad: Pricing is very simple. We have a monthly per user subscription fee for each client or user using StatX. The fee is $10 per user per month when paid as an annual subscription. That allows the client to use StatX with QuickBooks Online, and with the other apps we have on our platform.
Laurie: Before we get into those other apps, can you clarify whether the accountant has to pay a user fee for each of the clients he’s pushing notifications out to, or just for his own use?
Prasad: For each user that has the app installed on their phone. So, if the accountant sets up 5 clients, the accountant would have one subscription for him or herself, plus 5 for their clients.
Laurie: Got it. So what are some of the other small business applications that StatX already has a mobile dashboard for?
Prasad: Our connector to WordPress is one example, we can fetch your daily visitor stats and see how it trends and you can get notifications for new posts, comments, visitors etc. Another one is MailChimp for email marketing. Instead of having to go to MailChimp every time you want to see how many people opened your email and how many clicked through, we just send you live updated stats as things change.
Laurie: I know StatX also works with Microsoft Excel and you work with QuickBooks Desktop. How does it work with these?
Prasad: For QuickBooks Desktop, you can export reports into Excel, as you normally do, and we have an add-in to Microsoft Excel that lets you connect that information with StatX. So, you can provide stats to your client’s phone with a single click in Excel or QuickBooks Desktop.
Laurie: Anything else that’s important for small business owners and decision-makers to know about StatX?
Prasad: In addition to being a powerful dashboard that connects to many different apps, StatX can be used to create quick and easy, succinct workflows. For example, if you’re collaborating with your team on a particular check list of items that need to be done, instead of sending e-mails back and forth, people can just check off items on the checklist via their mobile device, and everyone gets notified of the status. Say you need approvals from your boss for different things, you create an approval stat for that. We have many stats like this that help with collaboration and to coordinate workflows.
Laurie: Very interesting, and thank you so much for your time today and sharing this info.
2017 has the potential to bring unprecedented changes to the technology landscape for SMBs. In most years, the top tech trends tend to develop in an evolutionary way, but this year we also will see some more dramatic shifts that SMBs need to put on their radar. Areas such as cloud and mobile continue to evolve in important ways, and they are also paving the way for newer trends in areas including artificial intelligence (AI) and machine learning, integration and the Internet of Things (IoT) to take hold among SMBs.
Although we can’t cover all of them in our Top 10 list, here are the headlines for SMB Group’s 2017 Top 10 SMB Tech Trends that we think hold the most promise for SMBs in 2017. Click here for the full report.
- The Cloud Continues to Power SMB Digital Transformation.
- Industrial Internet of Things (IoT) moves from hype to reality for early adopter SMBs.
- The Rise of Smart Apps for SMBs.
- Focused, Tailored CRM Solutions Take Hold With SMBs.
- SMBs Get Connected With New Collaboration Tools.
- SMBs Modernize On-premises IT with Hyper-converged Infrastructure.
- Application Integration Gets Easier for Small Businesses.
- SMB Mobile Momentum Continues, But Mobile Management Lags.
- Online Financing Options for Small Businesses Multiply.
- Proactive SMBs Turn to MSSPs and Cyber Insurance to Face Security Challenges.
At a conceptual level, most mid-market decision-makers understand the need to capitalize on new digital technologies to sustain and grow their businesses. SMB Group survey research shows that 88% of decision-makers in medium business with 100-1,000 employees believe that technology solutions can help them to significantly improve business outcomes and/or run the business better.
But all too often, infrastructure technology vendors miss the mark when it comes to serving midmarket companies, for a couple of key reasons. First, “the midmarket” is an amorphous term, without a standard definition. Second, while many small businesses self-identify as being small businesses, few midmarket companies self-identify with the midmarket label.
Being grounded in their vertical makes more sense, as market requirements, competitive pressures, workflows and other dimensions of doing business differ dramatically between, say, a law firm with 200 employees, and a consumer manufacturer with 1,500 employees.
However, many midmarket companies face common challenges in an age where technology is transforming virtually every industry, with pressure from both large enterprises and startups. They need to compete against enterprise behemoths with deeper pockets, and greater technology and business expertise, and battle disruptive digital startups that can start with a clean slate–without legacy infrastructure and business models to complicate or limit their goals.
Dell Technologies (Dell EMC) recently conducted a survey among 4,000 midmarket and large businesses that underscores these challenges. The study assessed how business decision-makers are thinking about and planning to transform to survive and thrive in the digital era.
In this post, I discuss these challenges, and Dell EMC’s strategy to help midmarket companies refocus on key areas that they will need to adapt to compete effectively.
The Heat is On, But the Path Forward Isn’t Always Clear
Dell EMC’s study reveals that companies are clearly feeling the digital heat (Figure 1). Rapid technology innovation is fueling uncertainty about their businesses and industries, and fears that new competitors with new business models will threaten their businesses.
Figure 1: Business Decision Makers’ Concerns About the Digital Future
Source: Dell EMC and Vanson Bourne, Embracing A Digital Future Survey, 2016
In addition, 2/3 of respondents say they’re not doing a good enough job keeping pace with digital transformation. Even more alarming, roughly 60% say they are unable to meet customer demands in key areas such as product/service innovation, building trust, predicting opportunities, providing more personalized experiences, and operating the business in real-time. Several obstacles are impeding their capabilities in these areas, including:
- Insufficient budget and resources
- Inadequate skills & expertise
- Lack of senior support
- Technologies working at speed of business
- Data privacy and security concerns
These challenges are more daunting for midmarket companies than for large ones. According to SMB Group research, the #1 technology challenge for U.S. medium businesses is implementing new solutions, followed by keeping company information secure (Figure 2). Notably, just figuring out which technology solutions can best help the business is their number tech challenge, followed by keeping existing systems up and running. With annual median IT budgets between $250,000 to $499,999, it’s no wonder that containing technology costs rounds out the top five.
Figure 2: Medium Business Technology Budgets and Challenges
Source: SMB Group
Bringing Digital Transformation Into Focus for Midmarket Businesses
Given so many uncertainties and challenges, how can midmarket companies turn the somewhat fuzzy concept of digital transformation find the right formula to actually achieve it?
Dell EMC is tackling this by first, bringing the specifics of digital transformation into sharper focus, and second, by providing the technology foundation required to bring this transformation to life.
From Dell EMC’s vantage point, the following capabilities are core to achieving digital business transformation (Figure 3):
- Agile product/service development to accelerate go-to-market readiness
- Being able to predict new opportunities with real-time data and analytics
- Creating transparency to build customer trust
- Providing a personalized experience to engage and keep customers
- Operating the business in real-time using analytics for better decision-making
- Protecting business assets and people from cyber threats
Figure 3: Enabling Digital Transformation
Source: Dell EMC and SMB Group
Dell EMC views three technology pillars as essential to enable this:
- IT transformation to power business transformation. IT must add more value to the business, with capabilities to develop new applications and optimize infrastructure. By putting technologies such as cloud native applications, hybrid cloud, converged infrastructure and storage, big data and analytics, and Internet of Things (IoT) in place, businesses can automate and streamline existing operations, and be ready to spot and tap into new opportunities.
- Workforce transformation to help attract and keep the best talent. Changes in technology are reshaping what employees expect the workplace to be. Businesses need more effective, flexible ways to get work done and collaborate–anywhere, anytime and on any device. Innovative client devices and digital workspaces that afford easy yet secure access are critical to keep up with these shifts, and to improving key business metrics in areas from worker productivity and efficiency to customer satisfaction.
- Security transformation to help prevent breaches and business loss. Digital security must transform to support digital and business transformation. Businesses must stay ahead of rapidly evolving cyber threats to prevent breaches that can decimate or even destroy a business. As digital capabilities evolve into core business assets, midmarket companies need to update their security approach with solutions that help them proactively detect and respond to threats, manage access, prevent fraud, secure endpoints and the perimeter, and strengthen governance, risk and compliance practices to stay safe.
Summary and Perspective
The bulk of business transformation occurring today wouldn’t be possible if not for the technology transformation that underpins it. Not long ago, companies were struggling to ensure that IT operations were aligned with their business needs and objectives. Now, as digital increasingly becomes part of the business fabric, it’s becoming difficult to find any dividing line at all to separate business and IT. In a digitally driven world, IT and business are becoming inseparable sides of the same coin.
Resource constrained midmarket companies need to partner with providers that can help them determine what business transformation means for their individual companies, sort through the digital hype, and develop strategies to revamp their IT, workplace and security approach to streamline existing operations and create new business models that will move the business forward.
Of course, Dell EMC isn’t the only IT infrastructure player touting digital transformation in varying shapes and forms. However, Dell EMC is the only major player providing a one-stop shop for end-to-end, desktop to data center infrastructure solutions.
Dell EMC has also been a pioneer in workforce transformation. Over the past eight years, Dell EMC IT and human resources teams have collaborated to create a more flexible workplace. Today, 25% of Dell EMC’s workforce telecommutes (the company has a goal of having 50% of it’s workforce work remotely full or part-time by the year 2020), and Dell EMC has built a website devoted to helping IT, human resources and other decision-makers to figure out how to adapt their own workplaces for the future.
Finally, midmarket companies can’t start IT and business planning from scratch, and often need solutions that can plug into existing infrastructure. Dell EMC provides a full spectrum of solutions, from consumer to very small business, to midmarket and large enterprise. This puts Dell EMC in an advantaged position, as it can calibrate and scale infrastructure, workplace and security solutions for mid-market customers, regardless of where they are along the transformation curve.
Note: This post was sponsored by Dell Technologies.
Laurie: Today I am speaking with Arash Asli, who is the Chief Executive Officer at Yocale. Arash and I met earlier this year at a Salesforce event. Arash’s company, Yocale, provides small local businesses with some very compelling marketing services. Arash, can you tell us about Yocale and the problems that you help small businesses solve?
Arash: Absolutely. Yocale’s story started with a basic search on a smart phone for a local service, a massage therapist actually, and in the frustration of not being able to reach any therapist or book an appointment in the evening. So it sparked the idea for a listing site that people could use to find info on local service providers, and then book them online—kind of like a combination of Yelp and OpenTable, but for appointment-based services. This of course helps customers easily find and book appointments. The YoCale platform becomes the place where the local consumers can discover, book, and review local service providers within their community. So you don’t have to drive 10 miles across two suburbs for a hair stylist when there’s a great right in your neighborhood—who may also be able to recommend a local massage therapist or a personal trainer nearby.
But our key mission is to support appointment-based local businesses by helping them to attract local customers, take the friction out of scheduling, and increase customer satisfaction. Just like the buy local movement, we’re like the book local movement basically with a mission of encouraging consumers to book local with service providers.
Laurie: This seems to be part of the trend towards more specific or individualized marketing services for different kinds of businesses, with Yocale targeting local small business service providers.
Arash: Exactly. In addition to marketing, we also help them automate operations, such as online booking, text and email reminders to reduce no-shows, email marketing, SEO optimized search, staff scheduling and more. Our software tackles two of the main challenges that these businesses face, which are marketing and data security and records management, which are two of the top SMB challenges that you covered in SMB Group’s 2016 Top Ten SMB Technology Trends. Once we help appointment-based businesses attract new clients, solution makes it easy for them to manage their entire business on securely in the cloud, from any device.
Laurie: Right, right, and this is for service providers, which are actually a bigger percentage of small local businesses than those selling physical products, and their needs are definitely different.
Arash: Absolutely. For these businesses, online marketing can be extremely difficult and it can be expensive to stand out and get the traffic online. With the Yocale marketplace, we group all the service providers in one community together, so we can funnel bigger stream of motivated local purchasers. This makes it easier for service providers to get discovered, and streamlines the booking process for appointments.
Another way we help is with the Yocale internal referral system. We have a community of local service providers, and we promote complementary services to the consumers or the members of Yocale that are booking services. So, when the client books an appointment with one service provider, we let them know that they can book their other services in the same area with the same account
Laurie: What areas is the Yocale service available in?
Arash: We initially launched Yocale in Vancouver, Canada, and we’re expanding to other areas. So, we have customers from various different cities throughout North America and overseas now. People are signing up because we help them to market more effectively, automate operations, such as invoicing and staff scheduling, and to manage clients. When they start using our software, they automatically become part of our marketplace.
Laurie: So, if you’re a small local service provider in an area and you haven’t really heard of Yocale or familiar with it, how would you start kind of taking advantage of it and using it in an area that you guys haven’t kind of officially entered yet? Is there a way to do that?
Arash: Yes. Those customers can still sign up, and we can help automate their operation, with the functions we discussed. So as long as they do business in an English-speaking country and in the appointment based business, we can help them.
Laurie: Okay, great, and do you have anyone, just to kind of maybe wrap up, do you have like your favorite example of a local services business where using this has really made a difference?
Arash: Yeah, absolutely. I’ll just use an example of a well-known hair salon in downtown Vancouver. Their clients are high net worth individuals, celebrities. They were doing a lot of things manually, working 10 – 12 hours a day to just to try to keep customers happy from a point of view of being able to schedule and reschedule them. And time is a precious commodity for a lot of small, local service providers.
With Yocale, people can book online and they can reduce their no shows. It’s saving the salon a lot of time and aggravation. It’s really taken off—about 85% of their customers now book online.
Laurie: Thanks, Arash, for the Yocale overview.
Smaller businesses are usually preoccupied with what it takes to grow the business and keep the lights on—getting customers in the door, generating more revenue and maintaining profitability (Figure 1). Business growth and profitability are still extremely important priorities as companies grow, but other challenges arise. Workforce-related issues, such as improving employee productivity, meeting compliance regulations, and making it easier for employees to collaborate start to become more important. However, as business gets more complicated, spreadsheets, point solutions and workarounds that got the job done when the business was smaller are no longer up to the tasks of recruiting, hiring, managing and retaining the people the business needs to grow.
Figure 1: Top Business Challenges for Small and Medium Businesses
In 2012, Kronos, a long-time leader in enterprise workforce and human capital management with its Workforce Central solution, acquired SaaShr, which it rebranded as Workforce Ready. Workforce Ready provides a cloud-based, integrated workforce management solution designed specifically for SMBs (Figure 2), enabling Kronos to broaden its market reach. At KronosWorks 2016, held in Orlando in November, Kronos provided us with an update on how Workforce Ready has evolved and where it’s headed.
Figure 2: Kronos Workforce Ready Platform
Integrated Workforce and Human Capital Management for SMBs
Kronos has continued to add new functionality to Workforce Ready since the SaaShr acquisition. In its most recent refresh, Kronos has taken a page from the consumer apps world, streamlining Workforce Ready navigation with simplicity and visual navigation to make it easier to use. The latest version includes “hot action bars,” to ensure workflow paths are consistent across Workforce Ready modules, and more intuitive for users. And, the vendor has upgraded dashboards and personalization features so users can do things more quickly through action buttons and icons instead of via pop-up menus.
Kronos has also enhanced employee self-service in areas inclduding employee on boarding, benefits management and performance management; and added the capability to mass populate Affordable Care Act (ACA) and 1095-C forms.
Supporting Workforce Ready’s commitment to help companies manage hourly wage earners, Kronos has also updated timekeeping and scheduling features, such as alerts that notify managers of employees’ scheduling preference changes.
Pricing starts at $23 per employee per month for all Workforce Ready modules, and at $5 per employee per month for Human Resources as a standalone module. Kronos also charges a fixed implementation fee, based on the number of employees and the number of modules the customer purchases.
Workforce Ready Customer Growth
At KronosWorks, Kronos reported that about 1 million users now use the Workforce Ready platform, and that it wins against the competition in more than 50% of the deals in which it is considered. In addition, Workforce Ready has:
- Grown it’s customer base 45% over the past twelve months.
- Enjoyed a 48% increase in customers selecting full-suite adoption (including recruiting and on boarding, performance and compensation management, benefits administration, time and attendance, and payroll).
- Increased international customer adoption 110% in the last year (Kronos currently sells Workforce Ready in Australia, Canada, parts of continental Europe, Mexico, the U.K., and New Zealand, in addition to the U.S.
- Achieved a 93% customer retention rate.
Drivers for Integrated Workforce Management
SMBs are turning to Workforce Ready when they reach a point where trying to consolidate and reconcile data from spreadsheets, point solutions and manual systems doesn’t work anymore. The manual effort required with this approach becomes too tedious and time-consuming, and redundant data entry results in too many errors. As important, siloed employee information makes it difficult for decision-makers to see what’s going on in the workforce, and take proactive measures to improve key performance metrics, such as reducing labor costs, improving employee productivity, increasing compliance, or reducing IT overhead.
For example, SMB Group research shows that SMBs using Workforce Ready were able to reduce the time it took to compile management reports 50%-80%; decrease time to perform HR administrative tasks 25%-35%; and improve employee engagement 30%-50% (Figure 3).
Figure 3: Improving Employee Productivity
Kronos sells Workforce Ready through two different channel models. For businesses with fewer than 100 employees, Kronos continues to sell Workforce Ready through the reseller model that SaaShr had established prior to the acquisition. These partners, typically local payroll service bureaus, buy the solution from Kronos at wholesale pricing, add their own services and branding, and then sell it to their customers. Since the acquisition, Kronos has roughly doubled the number of partners for this market.
Meanwhile, Kronos’ direct inside sales team sells to larger organizations with more than 100 employees.
Summary and Perspective
Workforce Ready is now a $100 million a year business for Kronos, and the vendor believes that it has plenty of headroom to grow. SMB Group agrees. Fast growth start-ups will opt for an integrated approach out of the gate, and established SMBs will need to take a more integrated approach to HR to attract, retain and efficiently manage the talent they will need to compete and grow.
To that end, Kronos is investing both to improve the solution and expand sales channels. The vendor recently conducted a survey, which revealed that 75% of firms with 100-2500 employee firms only look at two or fewer vendors when considering workforce management and/or payroll solutions. Kronos will, of course, need to increase market awareness for Workforce Ready to get into consideration in more deals. Once it’s in those deals, Kronos believes that it has the right value proposition—e.g. an integrated workforce management and HCM solution—to continue to win a majority of those deals and grow.
In addition, Kronos has focused heavily on the value that Workforce Ready provides for managing hourly workers. These workers comprise the majority of the U.S. labor market (Figure 4), and Kronos has been able to differentiate in the HCM space with this focus, as most companies rely on a mix of hourly, salaried and 1099 independent contractors. However, Kronos will need to broaden its positioning to highlight how it can help SMBs to more effectively manage workers of all stripes in order to compete more effectively against HCM vendors, especially for business among fast-growth, start-up companies that tend to have a higher percentage of salaried workers.
Figure 4: U.S. Hourly vs. Salaried Workers
Kronos’ pricing is competitive, and less expensive than vendors such as Ceridian and Workday, which should also help its cause. But, as Kronos readily acknowledges, building market awareness for Workforce Ready, and educating SMBs on the benefits of an integrated approach are probably the biggest hurdles it faces to achieving its goal.
And, although Kronos has done a good job in growing its private label reseller program for the sub-100 employee business market, the HR software vendor list is growing quickly. Many startups, such as Namely, Cezanne, Justworks and others have entered the fray in the last couple of years. Kronos will need to double down on usability to stay ahead of startups moving in on the low-end.
Note: Kronos is an SMB Group client, and paid my travel expenses to KronosWorks.