Mid Market Matters

Q&A: As vendors pursue "down market" strategy, IT pros at SMBs still haven't found what they're looking for.

Finding the large enterprise market saturated, vendors have been trying to go "down market." Microsoft, Sun Microsystems and Oracle, for example, have come out with stripped-down versions of some of their enterprise products. Theyve also been productizing their service offerings in such a way that smaller companies are seeing certain capabilities for the first time.

But does simplicity come at the price of effectiveness? eWEEK Executive Editor Stan Gibson and Labs Director Jim Rapoza recently spoke with members of the eWEEK Corporate Partner Advisory Board to find out if these products are meeting the needs of midmarket companies.

Participating in the roundtable conversation were Kevin Baradet, chief technology officer of Johnson Graduate School of Management at Cornell University, in Ithaca, N.Y.; Randy Dugger, president of Dugger & Associates, in San Jose, Calif.; Tom Miller, senior director of IT for FoxHollow Technologies, in Redwood City, Calif.; Fran Rabuck, president of Rabuck Associates, in Philadelphia; Robert Rosen, CIO of the National Institute of Arthritis and Musculoskeletal and Skin Diseases, in Bethesda, Md.; and Kevin Wilson, product line manager, desktop and mobile, for Duke Energy, in Charlotte, N.C.

Typically, small enterprises dont have very big IT staffs, and to tailor products for that market, vendors have tried to simplify things—to take a complex product and get rid of many of the features that arent needed to make it easy for perhaps a nontrained person to use. Vendors say theyre doing that with their new offerings. The question is, Are they?

Miller: First of all, what is the definition used by the industry to denote what a small to midsize business really is? If I look at some of the needs of some startup companies that are maybe 20 to 50 employees in size, versus a company, say, of our size, which is 600, versus a company with a half-billion dollars in revenue—there are very different needs.

Yes, there are very different needs, and were talking about a company that may be dealing with channel partners, but in this day and age, may also be dealing directly with vendors. Theres no perfect definition.

Miller: Taking it to the next level, then, the offerings that vendors are providing—whether theyre infrastructure- or application-oriented—are they just repackaged offerings, or are they tailored for the SMB market? Thats one of the first places I like to start with.

/zimages/1/28571.gifClick here to read more about vendors efforts in the SMB space.

Rabuck: When you talk about vendors supplying or refocusing on small business, it varies. There is a whole new crop of companies that are doing this. Theyre offering bread-and-butter products—e-mail infrastructure, database-type applications, calendar, scheduling. These are things that, from a collaboration aspect, can get a small company off and running.

How about simplicity? Are you seeing real simplicity that makes life easier for you?

Dugger: The biggest thing I see with the startups I consult with is that they just want everything up and running quickly. It really comes down to whether they want to outsource everything or bring it in-house. If they want to bring it in-house, it tends to be a small-business server—its an all-in-one solution, and it comes up quickly with very little hands-on. [These kinds of products] have a lot of wizards for taking care of the administration of the tools.

Rabuck: I think big companies, the Microsofts and such, are trying to recruit the services companies to service SMBs, providing products such as Microsoft Dynamics that are hosted either through the vendors themselves or installed in-house. Its important to have the option because many small companies want to bring this stuff in-house and have some control.

So, youd start with software as a service and then move it in-house?

Rabuck: Yes, thats correct. At least, thats the long-term plan. The result may be that these companies find that [SAAS] gains momentum after a while. It becomes harder to move things off if theyre working well on the software-as-a-service model. Coupled with this, many things that are Web-based more and more are creating sort of an on-site backup, so if something does disappear tomorrow, youre not totally lost. You still have the most important, critical parts of your information.

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