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Arguably CIOs of midsized businesses have one of the toughest jobs in IT. They often not only serve as their company’s CIO, but pull double and sometimes triple duty, acting also as the firm’s CFO and/or COO. This means that at most they can devote about half their time and energy to the company’s IT needs.
Necessarily, they also operate on limited budgets with limited staffs. There’s no rep from one of the major IT vendors around to hold their hand or provide immediate support or guidance when needed. Typically, at least in the past, the major vendors didn’t offer solutions or services that scaled to the midsized enterprise’s needs or provide top tier enterprise application systems.
Instead of dealing directly with the likes of IBM, SAP or Cisco in the past, midsized CIOs typically had to rely on second or third tier integrators, resellers, VARs (value added reseller) or consultants to keep the IT ship afloat and on course and customize their systems.
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Being a midsized company or, worse, a small business makes it difficult to leverage the benefits of technology. A new study by Web hosting firm 1&1 Internet indicates that 40 percent of SMBs still don’t have an online outlet for their business. And half of that group don’t have a clue how much it would cost to put their wares or services up on the Web.
The news is not all negative for midsized enterprises and their IT chiefs, however. Recently major vendors including IBM, Oracle, SAP, and Cisco have begun to come calling with offerings designed to meet the needs of the midsized market and even small companies.
Why? Two reasons: The major companies have largely fulfilled their IT needs for the time being. Second, according to IDC, SMB IT spending will top $629 billion by 2013.
To offset the budgetary and IT management limitations of a midsized corporation, the major vendors are seeking to make their offerings relatively easy and inexpensive to implement, manage and upgrade. Traditionally enterprise applications such as ERP have been too complex for midsize companies and expensive, difficult and time-consuming to install and operate. Now, though, IBM, Oracle and SAP claim they can provide affordable, manageable ERP software by – IBM’s case -- providing integrated application suites designed to make the benefits of prepackaged and pre-configured top-tier applications available to midsize organizations.
Cisco Systems, which previously sold its equipment almost exclusively to large service providers and businesses, is taking the same approach with
recently introduced networking gear aimed at the midsized customer. It has also launched a host of new products and services targeted directly at small business. This is part of Cisco’s promised $100 million investment in the SMB market.
IBM has taken its courtship of the midsized market, and the IT decision makers in these companies, one step further by providing not only the products but the financing needed to acquire them. On July 27, it unveiled a new package of data protection products backed by financing from IBM Global Financing, its lending and leasing business segment.
In June, IBM also came out with a study of midsize organizations in 17 countries. The respondents listed their priorities in this order: The highest-priority technology solution, chosen by 75 percent of respondents, was Information Management, which turns mountains of data into meaningful insights. The most pressing business challenges included increasing efficiency and productivity (80 percent), improving customer care (74 percent) and better use of information (72 percent).
A majority of firms also said they viewed their primary IT provider as a technology advisor or IT and business consultant. That’s a role the major vendors want to assume now that the SMB market is finally on their radar, and the names of midsized IT chiefs have been added into their marketing and sales rolodexes.
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