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CDW Study Reveals SMB IT Trends

We hear the phrase all the time -- "SMB," or small and medium-sized businesses. Partners, vendors and analysts all say that the new pot of revenue gold lies at the end of the SMB rainbow, now that bigger companies have just about all the technology they can stand, thank you very much. But SMB is not a homogenous category of enterprises. Indeed, some Bs are considerably more M than S, and vice versa.

With that stratification in mind, channel heavyweight CDW recently completed a study on how small businesses grow to be medium-sized (meaning, for the purposes of this study, shops of 100 employees or more), and how much focus they put on IT in the growth process. The study provides some insight into small-business survival skills, given that only half of all startup businesses survive their first four years. The survey results could also prove to be instructive for partners setting their vessels out into the ocean of SMBs.

You can see the full study here if you fill out a short request form (pretty much name and e-mail). It's worth a look, as it reveals a few trends partners might like to mention when they call on clients and a few strategies channel players can use to close deals.

First off, CDW found that in successful startups -- in a cross-section of industries, not just in technology -- IT is a big deal for business owners. Of the companies surveyed that went from startups to more than 100 employees, 74 percent of owners said that they were "totally involved in IT decisions"; 42 percent of them said that they handled IT themselves, with no dedicated IT department -- although those that did have a dedicated IT person or department were likely to grow more quickly than those that didn't. Fully 65 percent of business owners agreed or strongly agreed that their IT strategies were critical in their companies growing beyond 100 employees.

A hearty 22 percent of bosses went as far as to identify themselves as "total geeks"...and saw their companies grow, for the most part, faster than those whose owners were less interested in IT.

"One of the most compelling findings is that IT literacy is a strong factor [for growth]," Lauren McCadney, senior segment manager for small business at CDW, tells RCPU. "We asked people to self-identify. Those folks who self-identify as IT geeks or power users, their businesses really were growing much better."

But even the geeks need help. A hefty 65 percent of owners said that they employed some type of consultant or outside IT help, signaling demand for consultants and other channel players. But what do small-business owners want from channel partners?

Well, the biggest regrets among MB (as opposed to SMB) owners surveyed were that they didn't take advantage of the technologies they did acquire (21 percent said this) or that they didn't integrate technology strategically into their business plans soon enough (18 percent). So, McCadney says, partners should hit business owners with plans for strategic IT investment early and often -- and emphasize that technology can make or break a small business; it's not just a fun set of toys.

"I would say number one, if they're working directly with business owners, is get that business owner to slow down and realize that it's not a matter of, 'Can we afford to do this?' It's, 'Can we afford not to?'" McCadney says.

And partners shouldn't leave customers hanging once a system is installed; they should guide them through the sometimes painful process of getting it to work and helping employees become accustomed to it.

"You need to have a healthy appreciation for technology," McCadney says. "There is huge opportunity to actually work with the customer to make sure that they fully know how to take advantage of what they have."

The bottom line from the survey: The more a small business is into IT, the better its chances are for quick growth. And that's good news for partners who know how to get that message across.

What are some of your SMB sales strategies? If you're a small-business owner yourself, how important has an IT strategy been for you? Talk to me at lpender@rcpmag.com.

Posted by Lee Pender on 08/29/2007 at 1:21 PM


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