How SMBs Use Their IT Resources w/ Wayne Kernochan

SMBs differ from large enterprises in how they use their IT resources, says Wayne Kernochan, senior analyst at Illuminata. In an interview with ChannnelProManaging Editor Cecilia Galvin, Kernochan explained those differences and how they are continually evolving.

ChannelPro: What are the differences between the IT needs of SMBs and those of enterprise customers?

Kernochan: Over the past 10 or 12 years, there have been both constant and evolving differences between SMBs and large enterprises. What has remained constant is that SMBs have a very different attitude toward technology. You can’t tell them that they have to back up their database or periodically reorganize it so it doesn’t slow to a crawl, for example. They don’t have the bandwidth for that, because they either have no technical people in their organization, or they have only a limited number.

SMBs care less about the brand of a solution and more about the fact that any administration— backup, for example—can be done by the owner of the business as he or she takes off for the weekend. A lot of applications are not yet adapted for that. For the provider of services, that means the solution should be fully integrated and require as little servicing as possible. Unfortunately, when servicing is needed, it has to be “person intensive.” People will call for assistance who know nothing about computers, and will say so. There are no filters between the SMB and the provider of services, whether that’s a VAR or, in many cases, the ISVs themselves.

ChannelPro: What is the evolving difference?

Kernochan: The evolving difference is a combination of two things: There are more solutions adapted for SMBs—that’s the good part. At the same time, those applications are becoming increasingly critical to the success of SMBs. It’s very uneven across vertical industries, but it’s an important trend. VARs are being asked to provide solutions that are always up, if possible, as opposed to up all the time except at night and on weekends. This is especially important for businesses whose customers use the Internet to communicate with them or order from them. Solutions need to be as robust and flexible as possible.

Although this trend hasn’t fully played out yet, in the long run it will be good for small VARs. It’s now easier to find solutions that will meet their customers’ needs, and those solutions, especially for vertical markets, can tie customers to them more effectively.

If you buy an Oracle solution, for example, there are a number of people who can service it. But if you buy one from a company that specializes in ERP solutions for car dealerships, you’re not going to have as much competition. The market just isn’t large enough. And yet, as you visit your local dealer to have your car serviced, it’s clear that the success of the business increasingly depends on how well its overall solutions are working.

ChannelPro: What advice would you offer to solution providers as they look for new opportunities?

Kernochan: What works effectively is selling a personal relationship. It sounds easier than it is, however. Customers have an image in their mind that whenever there’s a problem they can get it fixed reasonably quickly—like “just-in-time” services. Whether that happens as part of a service contract or a series of individual contracts matters little to SMBs.