A worldwide survey of cost-conscious businesses, commissioned by Microsoft, finds those businesses that value IT as an enabler for better business productivity and effectiveness and those that use hosted services performed better fiscally than those that do not.
Businesses that value IT as an enabler for better business productivity and
effectiveness and those that use hosted services performed better fiscally in
2009 than those that do not, new Microsoft research claims.
Microsoft's global SMB IT and Hosted IT Index 2010 investigates how small
and midsize businesses (SMBs) across multiple segments fared during the
recession and how they use technology. Technology market research specialist
Vanson Bourne executed the report between November 2009 and January 2010. The
survey questioned 3,193 SMBs (up to 500 employees) across 15 countries
Despite the global recession, more SMBs surveyed in 2010 reported an
increase in revenue than in 2008. Those that reported growth view IT as
critical to their business success. In the past 12 months, 52 percent of SMBs
reported an increase in revenue, up from 39 percent in 2008. Increasing 20
points since 2008, 55 percent of SMBs view IT as critical to their business. Of
the SMBs that view IT as critical, 60 percent saw revenues grow over the past
12 months. In contrast, among SMBs that stated IT is not important, less than
29 percent saw revenue increase.
The 2010 index indicates SMBs are beginning to see the benefits of cloud
computing: More than 40 percent of the respondents that use hosted or cloud
technology reported revenue rises of 30 percent or more compared with the 90
percent of respondents not using hosted technology that saw decreases in
revenue. The advantages of hosted or cloud technology are viewed as reduced
cost and IT management and maintenance, as well as increased business value,
productivity and competitiveness.
Importantly, awareness of hosted services is increasing, with 65 percent of
SMBs using hosted software to some extent, while 73 percent of the remainder
have considered it, compared with only 44 percent in the 2008 index. In
addition, SMBs are beginning to understand the value of "renting" IT
as a service-36 percent said a pay-as-you-go model would be attractive.
Cloud computing has become a watchword for the IT industry as software and
services such as e-mail, Websites and e-commerce are increasingly available in
an on-premises, off-premises or hybrid model depending on business need, said
Michael Korbacher, director of EMEA software plus services in the
communications sector at Microsoft. "Over the last five years, we have
seen nearly 40 percent growth in usage of hosted services," Korbacher
said. "Using pay-as-you-go cloud technologies, small and midsize
businesses can now afford and easily have access to enterprise-class, secure
services across any platform."
The findings from the research were concluded by analyst firm Freeform
Dynamics, which independently assessed the SMB IT and Hosted IT Index 2010 to
ascertain to what degree IT adoption is driving revenue growth specifically
within the SMB community. Overall, the findings show greater awareness of the
benefits of IT among SMBs and a high reliance on IT across all industries and
geographies, and indicate a path toward better financial performance than for
those not currently taking advantage of IT advances such as hosted services.
"Our assessment of the report tells us that an increased focus on IT
correlates with good performance in all of the size categories surveyed,"
said Dale Vile, research director of Freeform Dynamics. "This whole
picture corroborates the notion that technology and hosted services can provide
tangible business advantage, even for smaller companies, and it's not
surprising to see that investment in IT and hosting goes hand in hand with good
Nathan Eddy is Associate Editor, Midmarket, at eWEEK.com. Before joining eWEEK.com, Nate was a writer with ChannelWeb and he served as an editor at FierceMarkets. He is a graduate of the Medill School of Journalism at Northwestern University.