Home > Uncategorized > How mid-sized businesses can make smart decisions on technology

How mid-sized businesses can make smart decisions on technology

This post Originally appeared in the ABC Tech and Games blog

The IT transformation currently occurring in the market thanks to cloud computing and the wide adoption of shared IT infrastructure seems like it’s predominantly affecting the large enterprise sector. But while this big-business IT revolution is going on, there is a flow-on effect to the mid-size market which is also tackling unprecedented data growth whilst struggling to assess the benefits of a move to cloud computing. The technology challenge for MSEs is in understanding how best to optimise their IT environments for both efficiency and scale so they can be comfortable in the knowledge they’ve made the right decisions for their business in the longer term. What is a mid-size business? Generally 100-1000 staff 1-3 IT staff who are generalists, not specialists IT staff typically have responsibility for the entire IT infrastructure. For the most part, the IT Vendor community in Australia tends to focus on the big end of town with multinational organisations dominating the landscape. When you then consider that 73 per cent (source: Reckon 2010 Annual SMB Business Survey) of the Australian economy is based on small businesses it seems unsurprising that mid-size enterprises which fall between these two market segments often seem to be forgotten. This means many MSEs are either reaching the limits of technology designed for small business with the resulting reliability and management headaches, or they’re paying too much to use specialist driven IT solutions aimed at the big end of town in an effort to avoid the problems they’ve just escaped from trying to do too much with SMB focused technology. These high end technologies with dedicated and siloed functionality aren’t well suited to mid-sized enterprises, not only because of their inherently high costs and inefficiencies, but also because the IT employees in these organisations are usually generalists. They need to know how all the company’s systems work, and how to fix them if they break and they simply don’t have the time to gain the specialist expertise needed to get the most out of these solutions. All of this puts the purchaser of IT for mid-size enterprises in an unenviable position. With many vendors rapidly jumping onto the cloud bandwagon, the mid-sized enterprise who still needs internal IT, but not at the kind of scale that would allow “internal clouds” are seeing a lot of turbulence in the supplier marketplace, none of which seems to be helping them. Many vendors are changing the way they are going to market and moving their focus away from their products for mid-sized business towards “cloudy” futures, and no longer investing in the kind of innovation required by this challenging business environment. While this is a worry, many of the traditional solutions offered by technology vendors to mid-sized enterprises often never really met their specific needs and challenges effectively. In an effort to win the business in these very budget-conscious organisations, mid-size businesses are often offered commodity-based solutions with low upfront costs, without being fully informed that many of these solutions cannot continue to meet their business needs as their company grows. In the midst of this gloom, one piece of good news is that in general, unlike many other areas of the marketplace that are facing budget constraints, mid-size business budgets are still reasonably healthy, though not infinite. Over the last few years, many MSEs have successfully focused on cost containment. For example, a large percentage have already taken the virtualization path, in fact, the virtualization trend is moving faster now than ever before. MSEs have seen great savings from these efforts, but most are now seeing that they’ve saved about as much as they can from consolidating and virtualizing their compute infrastructure while at the same time they are seeing a steady increase in the amount of money and percentage of their IT budget they spend on data storage. As the focus moves towards optimising data storage costs, mid-size businesses are looking for ways to reproduce the cost savings benefits they have gained in virtualizing their compute capacity. They are also looking for ways to optimize their environments to achieve more, address the data growth they are seeing and gain competitive advantage. These factors have huge implications on a company’s IT and in particular their data storage infrastructure requirements. However, these issues also provide a great opportunity to enhance IT systems to poise the company for growth. By demanding solutions that solve important and difficult challenges without undue complexity, and are powerful and scalable enough for the future, MSEs can gain great return on investment and get more from their suppliers. The test for mid-size companies is to make smart decisions on technology that is genuinely efficient, provide simplicity and offer scalability to meet growth requirements. The goal of MSEs needs to be focused around a technology foundation that will maintain pace with the growing business demands and allow the company to do more with fewer resources. So, what’s the lesson? Mid-size businesses are poised to continue growth and dominate in the market. The things they need to look out for in the technology arena are: solutions that can scale with their business needs – up and down – to protect their initial IT investment simple technologies that can be managed by IT generalists, yet still provide good cost of ownership and advanced enterprise-level capabilities partner businesses who can help them make smart decisions about the longer-term IT strategy, so it aligns properly with business objectives

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