SMBs are gearing up for some technology spending

It is estimated that a significant portion of the South African IT marketplace today is represented by SMBs (small and medium businesses), which is indicative of the demise of big corporate spending.

Interestingly, according to The Yankee Group, about 40% of SMBs are planning to spend more money on technology this year, which in turn means that IT solution providers have their work cut out for them - providing the right technology at the right price.

After years of making do with current infrastructure and software environments, many SMBs have decided it`s time to upgrade, driven by improvements in wireless connectivity and other key business areas.

Indeed, these businesses now understand that technology enables them to compete with their larger counterparts, however, they still remain more sensitive to price, ROI (return on investment) and TCO (total cost of ownership).

Vendors also have to bear in mind that like bigger enterprises, SMBs` business processes drive their organisations. Any application whether in-house developed, supplied or purpose-built must support these business processes.

So, vendors have to provide technology that meets these specific needs of this marketplace. "This is not enterprise-light. This is a different market with a different focus," comments Yankee.

According to Yankee Group, many vendors that once shunned the SMB have now gone aggressively after it as their enterprise customers continue to cut back on spending. "As these vendors compete for the attention of SMBs, they need to realise that customers now expect more from them than ever before."

It is also critical that SMBs select software that meets their specific needs without the price tag and complexity of "big business" solutions.

Fortunately, the increasing functionality and popularity of low cost, open source software is changing the face of SMB computing. No longer do these organisations have to partner with vendors that only offer high-cost proprietary software.

Additionally, flexible licensing for the first time makes "real IT solutions" affordable, while at the same time allowing for the future growth and scalability of systems.

Also, this gives SMBs some flexibility as many tend to focus on software functionality alone, not taking into consideration the implementation services or maintenance charges that are usually associated with an IT project.

Vendors should also realise that smaller enterprises like their larger counterparts require productive, modern solutions that address business processes like accounting, HR and procurement.

Hosted applications are becoming increasingly prevalent, now moving into the SMB space and offering even more flexibility, ease of implementation while also driving down costs.

Lastly, the key to vendors` success in the SMB marketplace is to listen to what they want, take it to heart and work at meeting their needs.