It’s time to update our perception of small medium businesses (SMBs). Gone are the days when they were seen as slow to adopt new technology.
Today’s SMBs are sophisticated technology buyers. In fact according to our recent study 70% of SMBs are prioritizing investments in business digitalization. The combination of Covid and the challenging economic climate led SMBs to link technology and digital transformation with the ability of their business to weather the storm.
SMBs recognize the power of technology to improve their business. This includes customers and marketing, operations, finance, people, and more. Technology can be used to transform all aspects of a business.
And unlike Enterprise customers, todays’ SMBs are refreshingly unencumbered by expensive legacy systems, byzantine structures, or lengthy procurement processes. They are agile-decision makers, ready and willing to invest, and quick to take action. And with the vast majority of businesses falling into the SMB category, there is a significant growth opportunity for Communication Service Providers (CSPs) who can understand the current stage of SMBs’ digital transformation journeys, and cater to their unique needs.
Since forever, SMBs have looked to a range of different providers to address their needs – be it phones, networks, accountancy software, IT support or security. And historically, SMBs have ‘fallen between the cracks’ of consumer and enterprise markets - lacking the resources and scale to justify more complex solutions.
As a consequence, telecoms and technology providers have typically evaluated SMBs by headcount, measuring success by the number of connections or mobile phone contracts sold. The net result is that SMBs have been treated more like consumers and offers have tended to orientate around devices and connectivity.
But almost overnight, this has become an outdated stereotype. Now, most SMBs are led by millennials who are quick to embrace technology and very comfortable with developing, buying or operating it. They have clear ideas about what they need for their businesses, and very focused on outcomes-based solutions – so forget about selling the speed of 5G connectivity or Apps like Microsoft 365 , they’re already over that.
Actually, the change goes even further - the digitalization of the SMB, and the proprietary data that they generate, means that increasingly, they themselves want to actively participate in a wider digital ecosystem of services, and are looking for the partners to help them achieve that goal. [GN1]
To get closer to the realities of those businesses – what drives them, what they look like, how they operate, what makes them special, and what unites them - we recently carried out a major piece of research into the global SMB market. Covering everybody from Australian farmers to Manhattan construction companies, we spoke to owners and decision makers in SMBs across North America, Europe and Asia Pacific. We found an appetite for new technology that extended far beyond the usual suspects such as cloud, 5G, and IT security. Over 70% of respondents could see strong or significant business value in everything from AI and blockchain, to IoT, automation, and apps.
In fact, while large enterprises still struggle with digital transformation, many SMBs are already running as fully-fledged digital businesses. The SMBs of today are sophisticated, tech-savvy, and highly independent when it comes to technology consumption. For example, one SMB analyst and consulting firm employs 20 people and uses more than 40 ICT products to deliver its services to clients.
Looking to the future, technology adoption is closely aligned with their business priorities: In the next 12 months, 70% of SMBs are eager to drive efficiency improvements for their businesses, with technology seen as a key enabler. While issues such as business growth and expansion, staff talent, customer contact, and experience were all closely linked to technology solutions.
The survey showed that there was universal agreement in the perceived value of technology to deliver business improvements across all sectors: hospitality & leisure, professional services, agriculture, manufacturing, education, healthcare, retail, technology, media and entertainment.
ICT solutions are important because they help to ensure all aspects of the patients journey with us are recorded and auditable. It also helps to put measures in place for security of data and it further helps to create cost efficiencies and benefit from economies of scale as we grow,”
Director & IT manager, Healthcare, United Kingdom.
However, SMBs still face challenges when trying to make the most of their ICT investments. Let’s face it, they haven’t the time, headspace, or specialist teams to solve complex technology and transformation issues themselves. 68% want a single platform for technology solutions, but currently they rely on an average of seven suppliers to address their ICT needs. So, one message comes through very clearly: They’d prefer to get complete technology solutions, from a single source, and they see their CSP as a very credible provider.
To succeed in this changing market environment, you need two things above all: 1. An understanding of SMB needs 2. A bold new business model to deliver to those needs, at scale
The digital marketplace trend is becoming well established, but to date, digital marketplaces have been too focused on reselling unbundled technologies rather than complete solutions. CSPs need to adopt a new way of thinking that’s focused on SMB customer needs and outcomes. To do that, it is essential that CSPs work collaboratively in a wider ecosystem of players. The focus should be on developing and selling outcome-based solutions via their digital marketplaces and with their ecosystem partners.
NTT DOCOMO, Japan’s leading mobile operator, recognized this and worked with us to launch a partner orchestration hub for its newly launched SMB marketplace earlier this year. Our Infonova Digital Business Platform’s unique ecosystem orchestration and monetization capabilities made it simple for DOCOMO’s partners including NewsPicks + d, Relo Club, and Meet In to rapidly onboard and sell their solutions through the marketplace. Their SMB customers then had access a range of services such as remote sales, telecommunications, labor management, and subsidy support that will help them to improve their efficiency and productivity.
To get closer to the SMBs and the type of solutions they need, read our report CSPs: it’s time to reacquaint yourselves with today’s SMBs.