Economy Ignites Interest in Managed Services and SAAS, Report Says

An AMI-Partners survey finds small businesses are focusing more on software as a service and managed services solutions as IT budgets tighten in an uncertain economy.

A recent 11-country study by AMI-Partners highlighted significant changes in small and midsize businesses' IT needs and interests. The study's focus was to analyze how the economy is impacting SMBs' perceptions, usage and purchasing behaviors related to IT. Among key changes identified in the study was the drastic increase of SMBs worldwide now showing strong interest in managed services and SAAS (software as a service) and dramatic increases in midmarket companies' plans to outsource specific IT needs such as storage, security and telecommunications.

The study, released this summer, found that most SMBs feel the economy is starting to stabilize, however, businesses are still seeking ways to significantly reduce costs and increase revenues. This includes exploring IT products and services that can directly and immediately help ease exaggerated pain points like restricted cash flow and limited access to credit. "Solutions like SAAS and managed services offer flexible payment options and usage-based models that are very attractive to SMBs right now, as they struggle to overcome the credit crunch and very tight IT budgets," said AMI Vice President of Marketing Chad Thompson.

Other changes in SMBs' IT perceptions and behaviors include their likelihood to purchase specific IT categories such as desktops, notebooks, servers, printers and software. The study highlights the small percent of SMBs that are "very likely" to make a specific IT purchase in the next three months compared to those "somewhat likely."

"What we are seeing quarter-over-quarter is that SMBs that say they are -very likely' to make a purchase in the next three months tend to make that purchase; however, those that say they are -somewhat likely' will require a clear and compelling reason to make the purchase," said Thompson.

The survey found over the last 12 months the influence of business decision makers (or owners and presidents) has increased drastically. For example, in a fourth quarter 2008 U.S. study, approximately 31 percent of SMBs stated that their business decision makers (BDMs) were involved in "brand selection" while making an IT purchase. The most recent study found that this number jumped to 83 percent.

The study surveys business decision makers of SMBs from four perspectives: Mindset, economic impact and the actions that are being taken to manage their businesses; IT purchase plans including spending, brands and planning; Buying behaviors including routes to market and decision making, and insights for fine-tuning GtM plans including value propositions, messaging, marketing mix and more. "What we are seeing in the SMB space right now is anything but -business as usual,'" said Thompson. "SMBs are re-evaluating the way their businesses run on a number of fronts, including where and how they spend money, how they drive revenues and how IT supports these goals."