A few years ago, the identification of a fresh, lucrative market bySMEs require a better kind of vendor. the IT sector, away from the traditional corporate client base, sent a buzz of excitement through the industry. SMEs were predicted by many to make a rush to catch up on the technology of their larger corporate counterparts and vendors rubbed their hands with glee.
I have since witnessed countless attempts by manufacturers, retailers and distributors to capitalise on the SME sector. Each claimed innovative and radical strategies, most of which have failed, faded away or are relaunching 'in denial'.
To date, the SME sector is safe in the hands of the Vars - not by merit, but rather by default, due to the specific needs of the SME. This has also been helped by the fact that Vars understand and have learned value add the hard way, through the concept that there's little or no margin in products alone.
Anyone who understands the needs of the SME will know why the retail model is fundamentally flawed. A typical SME has no internal IT expertise and, given the 'highly forgiving and gentle' nature of our industry, is at a disadvantage when attempting to set up a business advantage through IT, without outside help. Rather than providing systems, the retail sector continues to focus on raising profit from products and extended warranties. This business strategy will prevent retailers from becoming the key players in this market. SMEs want products that deliver continuous business benefits and the smaller Vars are ideally placed to provide it.
To help the Vars succeed in dominating the SME sector, manufacturers and distributors will really need to get their collective acts together.
Selling products to Vars for SME packages does not mean flogging yesterday's news from the corporate sector. Vars must be able to offer to SMEs small, scalable and highly integrated systems, rich in features.
And the small business server product was precisely what the market required. This software package offers inherent flexibility of licensing, as well as an appropriate mix of key features at an affordable price. At the same time, Vars need to offer the whole bundle of 'core' IT support services - implementation, troubleshooting, consultancy - rather than mere maintenance alone. Vars must set themselves up as the IT department of the SME customer.
The convergence of technologies is a warning of where the industry is going (particularly IT and telephony). On the other hand, the concept of a one-stop shop is about as unpopular as the paperless office. But as IT spreads into other industries as the catalyst for inter-compatibility and further entrenches itself at the very core of the organisation, the blur between whether a device is a photocopier or a laser printer, a fax machine or a scanner, a phone or a PDA will vanish. This shows that to cater for the fast-moving, systems-led SME market, a better type of vendor will certainly need to emerge - one that will need to be capable of providing integrated packages over an increasing range of technologies.
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