June 22, 2007

IT Analyst: "IT Vendors still don't get SMB IT"

eChannel Line writes Large IT vendors do not have a complete handle on the small and medium sized market, according to Wayne Kernochan, senior IT analyst at analyst firm Illuminata. "I continue to sense that some vendors don't feel the SMB market is worthy of focus."

While I respect what Mr. Karnochan writes, I disagree. Instead of creating a blanket statement that IT vendors don't get small businesses I think it's important to divide the small business market into small business types and also divide the IT vendors we're talking about. Many get it, but some don't.

Think about how much technology small businesses have purchased and use in their business:

-Constant Contact - 100,000+ users

-HP, Dell, Lenovo (IBM), Toshiba, Gateway - millions of computers sold to small businesses

-Microsoft & Intuit - millions of copies of their software is in the hands of small businesses

I could go on. I don't think the question should be if "IT Vendors" get SMB IT or not, The issue is the complexity of technology overall. We can surely say that millions of small businesses are buying IT from IT vendors and using it productively in their businesses.

Is technology complex? Absolutely. Is it sill primarily the domain of geeks? Of course it is. But guess what - when your car breaks down, there's few of us who fix it ourselves. We take it to a mechanic. Likewise, local technology consultants and hi-touch IT vendors is on the rise.

I'm not so sure if the issue is IT Vendors don't get SMB's but more so that many don't design technology for common PC users - as Apple has done for the Mac. It's not an "SMB" issue per se.

There's something else, the term "SMB" should really stop being used.

There are small businesses (1 - 50 or MAYBE 100 users) and then 100, 300 or so and up - mid sized businesses. These businesses have two different needs and mindsets. One is owner driven for the most part, the larger, small businesses often have managers and IT departments that have some independence in IT buying decisions.

eChannel Line writes "Often, a SMB ISV will be hosting the application [for the end user], and they are able to have both the knowledge of the software and of the needs of the particular customer. VARs may host it but they don't have the in-depth knowledge of the software."

Sure IT vendors could do much better in addressing the needs of small businesses but we can't paint all IT Vendors the same. Constant Contact has amazing support, other vendors do as well, including Verizon Wireless. Other vendors have terrible support.

But at the end of the day, let's be careful in saying IT vendors don't get "SMB's" when the real problem is simply that IT vendors want to get the biggest profit, while battling with shrinking margins and serving a complex market place of small businesses.

For PC buying - there's really no complexity here and I think most IT vendors are quite fine.

For software buying - a lot could be made easier; software as a service is going to change a lot of things; however integrating software is still quite complex; setting up Google Apps, for example, is not an easy process.

Integration of networks, hardware and software - is not a do it yourself process. If you want a telephone system, companies like M5 can come in and set it up for you.

So do IT vendors get SMB's. Yes they do. Some don't, but many do.

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