Techaisle Blog

Techaisle SMB and Midmarket AI and Analytics adoption trend research shows tremendous analytics scope to deliver more forward-looking predictive or prescriptive perspectives. In addition, there is a need to support the development of evidence-based corporate cultures that value positions and decisions based on data. Still, there are a mix of technology, organizational and cultural issues that businesses need to address along the journey to this future point.

Zoho is on a quest to enable the future point. One of Zoho's primary goals has been to offer end-to-end business applications that allow businesses of all sizes to automate business workflows. But it is not enough to enable companies to automate the workflows or collect data. It is also vital to have a platform, which gives businesses the capability to understand the data, analyze it and drive insights. If analytics is the key to connecting data to executive objectives, the cloud is the platform on which analytics and data – and digitalization and many other impactful solutions – will reside. With 13,000 paying cloud customers, separate from 50,000 who are using Zoho bundles (Zoho one – a collection of 45 apps), the Zoho analytics platform is knocking on the doors of established players.

Zoho has built its analytics platform vision on four pillars providing an end-to-end solution:

1. Self-service data preparation and management:

Zoho DataPrep, an AI and machine-learning driven self-service application, enables users to retrieve data from a wide range of sources, smartly cleanse, transform, enrich and prepare the data for practical analysis. It includes auto modeling and ML-based enrichment. Because of its popularity and ease of use, Zoho also offers its DataPrep tool as a stand-alone service.

2. Visualization and analysis leading to data stories:

An integrated enterprise portal builder (Zoho Sites) and presentation software (Zoho Show) enables business users to analyze data through self-service interfaces like drag and drop interface or natural language processing as well as other automated analysis for developing insights.

3. Augmented analytics for insights and actions:

Augmented analytics component enables business users to get both prescriptive and predictive insights from data. What-if analysis and forecasting models are a core component of augmented analytics.

4. Marketplace apps:

Developers and partners can develop analytical apps and publish them on Zoho's marketplace. Applications such as Jira, ServiceNow, and Shopify have seen the highest uptake within Zoho Analytics customers.

AI and ML seamlessly embed into all the components of the analytics platform. A crucial part of analytics initiatives in any business is preparing the data for insights. Marc Fishman, Director of Sales and Marketing, Call Center Sales Pro, could not contain his excitement when speaking with Techaisle about Zoho's DataPrep tool. He said, "the recent release of DataPrep honestly blew us away, causing us to explore that potential sharing of call center data. Depending largely on the toolset available to us after successful import, we have many options to consider — both internally and potentially externally for our customer base. It's beyond exciting!"

Many lenses can assess the importance of analytics and AI in the SMB and midmarket segments. One that illustrates the pace of these segments is the often-cited 'hype cycle,' which begins with a "technology trigger," soars to a "peak of inflated expectations," crashes down to the "trough of disillusionment," and then rises through a "slope of enlightenment" to a "plateau of productivity." Analytics and AI provide excellent examples of how this process plays out in the IT-centric world. As a concept, AI has lived at the peak of inflated expectations for many years, borne aloft by an amorphous vision of systems that will automatically know what's needed next. This is because, based on some elixir that combines a large quantity of data with fuzzy algorithms, supported by computational capacity delivered by Moore's Law, the rising quantum, or some combination of future breakthroughs. Meanwhile, analytics has followed a more gradual path, showing both real current benefit and the promise of additional value in the future – at which point, naturally, it will become a sidekick to AI.

Unfortunately, this is not an entirely apt description of the evolution of analytics and AI in the real world, especially in the midmarket segment. Despite bold claims to the contrary, businesses have primarily deployed analytics applications to consolidate data from diverse sources into an intelligible whole. Analytics as a discipline has been mainly concerned with using that data to create dashboards that illustrate current status and immediate or potential problem points. That is, as a descriptive or diagnostic tool. Techaisle research shows that 53% of US midmarket firms use analytics to provide a diagnostic view of the business, and 39% use analytics to recommend actions, in other words, prescriptive.

Zoho's unified business analytics platform may well change the adoption from diagnostic to prescriptive. Zoho's simple, cost-effective BI tool enables collaborative analytics and quickly provides 360-degree views of customers or the entire organization.

So what do SMBs and midmarket firms require of an analytics solution, and does Zoho meet those needs? Techaisle's survey respondents provided a definitive perspective that surprisingly reinforces the pillars of Zoho's analytics vision. "Solutions that enable self-service for non-technical users" is at the top of the requirements list for both small and midmarket organizations. It is a wise point of emphasis, given that research has found that utilization rates, satisfaction, and ROI increase if users can access analytics systems without IT support. As a result, Zoho has developed its platform for non-technical users. The following most frequently cited attribute, "platform technologies that integrate analytics and presentation," is ranked second by small businesses and midmarket firms. This focus reflects frustration in trying to integrate different tools to meet parts of the overall analytics requirement. For example, the Zoho Show platform integrates with Zoho analytics to create a slide deck and seamlessly embed reports and dashboards to make an interactive and immersive presentation. The third-ranked component in the midmarket findings, "big data designed and enabled database," reflects an immediate need. Similarly, "well-defined security and privacy implementation" reflects a segment-specific need for supplier assistance in ensuring that security is applied to the system of insight, ensuring that data analysis doesn't lead to data leakage. Of course, we all know that Zoho zealously protects user privacy.

Zoho is hitting on all the requirements of midmarket firms, and businesses are noticing. As Marc Fishman, Director of Sales and Marketing, Call Center Sales Pro, said, "We selected Zoho because of the ease of data sharing and integrated Desk, CRM, and connectivity applications. No other suite compared — both in price and breadth — that offered us so many tools we could immediately use."

Zoho analytics platform is built for non-technical, non-analytic users but has the depth and capabilities for technical staff and data analysts. Its best feature is data preparation, which alone is enough to justify using Zoho analytics platform. The platform delivers rapid time to value.

Survival of every business depends upon customers, and 2020 saw a ground-breaking year when customer intimacy (acquisition, retention, experience & satisfaction) drove technology adoption and business process evolution within the SMB and midmarket segments. Businesses in general, and SMBs in particular, have many poorly automated or un-automated tasks and processes that they could meaningfully improve by using focused SaaS applications. 59% of small businesses, 86% of core midmarket firms, and 95% have prioritized customer experience solution deployment. Still, IT staff within 38% of small businesses, 47% of core midmarket firms, and 55% of upper midmarket firms face challenges in deploying customer experience solutions.

Five9, a cloud contact center software provider, aims to lessen the IT challenge by “reimagining customer experience” through fully customizable solutions that empower customer agents to address customer needs. Deploying customer intimacy is a little bit like making Baked Alaska: the promise is delicious, but the method is mysterious. The journey from IT systems to a better customer experience isn’t a matter of magical alchemy that wreathes unlikely ingredients with an alluring halo. Instead, it results from a roadmap that starts with digitizing data and processes, moves forward through connected systems that encourage and support fact-based customer-facing activity, and result in an organizational capacity to understand and respond to customer needs. Midmarket businesses understand the appeal of the outcome – and they need guidance from suppliers like Five9 that can define the recipe for customer experience.

Five9 knows that contact center software is only one component of a set of sales, marketing, and customer service solutions. It knows that, with customer experience, it’s the mystery of how to aggregate data and integrate it with customer-facing activities successfully. Recent global SMB and midmarket research from Techaisle shows that within US small businesses, customer-focused SaaS business application adoption increased by 49% in 2020 and will rise by another 33% in 2021. Techaisle data shows that by the end of 2021, 76% of new SaaS adoption within SMBs will be customer-focused. Similarly, within the US midmarket firms, the adoption reached 82% in 2020, with 74% planning to add adjacent customer-focused applications in 2021. Europe research shows similar trends. To deliver on the promise of “reimagining customer experience,” extending the functionality of its solutions, and automating entire customer-facing business processes, Five9’s software must integrate with CRM, online retail, automated quoting, eCommerce, social chatbots, email, forms management, help desk, and queue management.

Integration is a crucial impediment to customer experience. Executives often see examples of organizations using data drawn from integrated internal systems, or from social media, from far-flung sensors, or third-party services, or from a mix of all of these sources – to improve the critical operating parameters of their businesses. However, these answers aren’t simply a result of having technology within an organization. Instead, better customer experience results from linking technology (and the data it collects, shares, and enhances) with front-line functions, which requires understanding how to develop technical competencies and integrate them within the organization.

Five9 has identified several partner types, especially CRM solution providers, UC suppliers, and ISVs, to deliver an integrated customer experience solution. Five9 has built an adapter to enable clients of all sizes to seamlessly integrate its CTI with CRM solutions such as Kustomer, Microsoft Dynamics, NetSuite CRM, Oracle, Salesforce, ServiceNow, and Zendesk.

For the CRM solutions providers, Five9 follows three distinct engagement models, each of which can establish Five9 and its partners as a partner of the customer, invested in their business success. At the same time, if executed correctly, the models enhance the revenue stream of Five9 and its partners.

  • Sell into the customers who are already using CRM solutions from one of the Five9 integration partners
  • CRM solution providers get introduced to the Five9 installed base to help with total CX transformation
  • Joint selling into new customer accounts who are evaluating CRM and contact center solutions

The above is not a simple, straightforward set of changes to embrace. However, the changes are central to transitioning to where the opportunity is growing – and this, more than any adherence to tried and true practices, is the goal to position its businesses for long-term viability. The nature of the partner relationship is a critical determinant of Five9 success. From a strategic sales enablement perspective, Five9 is focused on alignment with its sales team to create a better system by educating its sales team on the benefits of selling together with its CRM partners.

Unified communications is another technology area where most SMBs and midmarket firms have high planned adoption rates. However, the inhibitor is the inability of a hosted solution to adequately meet the needs of an SMB organization which demands many feature sets - call hand-off, integration with CRM solutions, integration of vertical applications, group calling/directory, and regulatory compliance. To enable such features necessitates customization or integration expenses which wipes out the cost savings. Five9 has partnered with Nextiva, Microsoft Teams, fuze, Zoom, TetraVX, and Mitel to integrate contact center and back-office, which augments the telephony and conferencing solutions to enable agents to be more efficient in solving a customer problem. Since many UC suppliers work with resellers as well, Five9 has aligned its partner program to understand how to build complementary routes to market options to capture as much market share together as possible.

ISVs are essential to cloud suppliers serving all types of customers. For example, cloud vendors, such as Five9, looking to build an enterprise-level platform need ISVs to provide critical capabilities to the core offering. In addition, vendors attempting to penetrate target markets work with a specific application vendor to demonstrate the relevance of their services; the ISV, in turn, relies on the platform vendor to provide evidence of a trustworthy application delivery platform. And cloud solution suppliers may position cloud applications as an extension of their core relationship with a customer, even as the ISV involved views them as a resale channel with excellent access to a high-value target buyer community.

Five9 has a formal ISV partner program with co-sell agreements, provides development support and accreditation, and promotes ISV solutions via Five9 CX Marketplace. Five9 already has 70+ ISVs in its program. These ISVs get access to the development environment, documentation, APIs, and SDKs to build integrations. Once the ISVs have built their integrations, they get accredited, and solutions get listed on Five9’s marketplace. To drive success, Five9 has a two-way referral initiative along with a co-sell motion. As a result, the program is growing every quarter, with an increasing number of partners wanting to partner with Five9.

Five9 is anchoring its global partner program on white-glove service, empowering partners, certifications, and development support. This year, Five9 is moving to target the right partners and provide new and improved professional certification options. It is also focusing on specific routes to market around certifications. In Five9’s own words, “…our special sauce is aligning with the Five9 sales team, demonstrating value, building mutual interest and trust, through initiatives such internal newsletter.” Partner Loop, a monthly newsletter, keeps all of Five9’s salespeople in the loop on sales wins, resources, all the great things happening with the partners, and why they should continue to win together with the partners. In addition, to accelerate time to market for its sales teams, Five9 has a partner locator, partner profiles, and CRM and UC integration guides to reduce the complexity of sales conversations. Partner Hello is an onboarding and activation concept that is seeing tremendous success and driving engagement. Five9’s amplify education webinar series provides training to its partners on new services and products. Five9 is addressing essential partner requirements. Techaisle partner survey shows that onboarding training and webinars are the two most crucial training options for partners with certification programs and web training modules representing the next-most important training options

To top it all, Five9 has also launched its Five 9 Global Partner Advisory Board and new Five9 Partner Hello Onboard and Welcome Guide in June.

Modern IT generally delivers systems that improve sales process efficiency and visibility. The drive to develop new customers and retain existing ones directly impacts the desire to emphasize solutions that support business growth, including social media, mobility, and analytics. Additionally, growing business confidence affects all business-relevant solution areas, freeing up resources for new solution exploration, adoption, and optimizing or redesigning business processes. Besides pure SaaS business applications, including cloud solutions, analytics, marketing automation, customer service, CRM, and other adjacent solutions, data shows that SMBs are planning to increase spending in AI, Chatbots, voice assistants, UCaaS, and mobility solutions.

Five9 is positioning itself to be a key player in the customer experience solution segment by successfully embracing an industry-wide trend away from rigid solution definition towards fluid, flexible configurations that integrate multiple components and moving from opportunistic to strategic. In addition, it is accelerating collaboration across partners for predictable, rapid responses to customer demands, becoming proactive in building effective relationships with trusted allies.

Management of P2P ecosystems is not a core focus of many vendor channel organizations – but it will be increasingly crucial to success in providing channel coverage for complex technologies. One distinguishing characteristic of a traditional channel firm is its ability and willingness to test, learn about, deploy, integrate and support new solutions as customers need them. However, increasing solution complexity has made it more difficult for channel partners to master all of the different technologies required by their clients. This has, in turn, led the channel to look at partner-to-partner (P2P) alliances as an alternative to the building (through training/certification) or buying (through new staff hires or acquisitions) unique expertise whenever required. Vince DeRose, President, PEAK Resources, Inc., said it very well, "it is difficult to staff engineering/delivery talent for every solution we sell. Training and certification are generally required to have a meaningful and relevant relationship with a manufacturer/OEM." Techaisle research shows that costs are high for staffing skills with certifications. In an increasingly complex market (e.g., IoT, hybrid IT), partners need access to many products – certainly more than they can afford to be certified. Certifications may work for some products, but they constrain options for partners dealing with configurable solutions. P2P collaboration is the panacea for delivering complex customer solutions.

The enduring issue of Partner-to-Partner

PEAK Resources, a 30-year-old DMR, actively believes in and participates in P2P to augment skill gaps – technical and geographical. Initially, most of its IT skills focused around IBM offerings, but now there are many prominent vendors in the market with varying solutions and platforms to meet changing customer demands, such as Cisco, VMware, Dell, and more. In addition, projects are becoming much more complex, requiring many different and complex IT skill sets to solve for the customer. Vince DeRose continues, "a P2P platform, like P2P Global, Inc. is vendor agnostic. It works specifically great for emerging technologies and vendors who have immature partner programs. Vendors are making efforts to develop their P2P enablement programs. Still, most see their platforms filling a gap in their portfolio instead of partners' preference for fulfilling a skills gap. "

Techaisle saw this trend start to take root with security, where deep and diverse protections (and threats) opened the door to mainstream channel collaboration with MSSPs and other specialized security providers. However, the channel partners could not immediately replicate the security experience in other areas. Channel partners often act as gatekeepers, reducing client exposure to other solution sources and internalizing as much of the IT-related business requirements as possible.

Still, though, with the industry-wide trend away from rigid solution definition and towards fluid, flexible configurations that integrate multiple components, P2P collaboration (and from a vendor's perspective, ecosystem alliances) is moving from opportunistic to strategic. In addition, the COVID-19 pandemic catalyzed technology and IT companies to become more flexible and quickly roll out more efficient and seamless digital solutions for partnering and completing projects.

CohnReznick, a 100-year-old firm specializing in tax and audit work and deep expertise in ERP core consulting for midmarket firms, has strategically jumped into P2P ecosystem participation. But, again, the pandemic was the great accelerator. It joined P2P Global, and whose "platform shines as it is laser-focused on curation versus throwing up matches like a job board type solution," says Reed Dailey, Director, Strategy, Technology, and Transformation, CohnReznick.

Partnering To Be Efficient

Techaisle sees solution packaging as a customer choice issue – and customers are choosing to move from turnkey systems to hybrid environments that can align with their evolving needs. In many cases, this requires an accelerated frequency of partner-to-partner collaboration. Real-world demands for predictable, rapid responses to customer demands requires that channel businesses be proactive in building effective relationships with trusted allies.

Karl Kleinert, Director, Advisory Services, CohnReznick, adds, "typically, the vendor solutions are closed ecosystems to their network, but end-customers are not only buying or using solutions from one vendor. We are in a heterogeneous world. The vendor platforms break down pretty quickly in terms of their partner networks as soon as a partner has a project with even a minimal level of complexity that requires ancillary and adjacent technologies. We are very particular about the partnerships that we enter into and make sure we have a route to market model that fits us and that we have good rules of engagement and well-defined roles and responsibilities. Customers are demanding new technologies, which exposes new skill gaps within the partners. A vendor agnostic P2P collaboration platform gives us the kind of flexibility that is important for business success. A good example was a rollout of Infor's Birst data analytics solution supporting a global ERP deployment. CohnReznick owned the overall implementation, and we leveraged another partner for the data migration."

Informed by end-user and partner survey research, Techaisle sees substantial and increasing demand for solutions integrated around data rather than physical system components. The escalating requirement will require changes in channel go-to-market strategies. Channel businesses that are not actively developing P2P capabilities will be vulnerable to gaps in their ability to meet customer expectations, reducing their ability to maintain solid and profitable relationships with existing clients. Results from the 2021 research indicate that channel businesses that are effective in P2P are more likely to experience growth – and higher growth – than those that rarely collaborate with other channel members. Vendors with solid ecosystem management programs with a platform that helps facilitate P2P collaboration have an opportunity to help engaged partners to obtain above-average returns, strengthening the vendor and its partners alike.

The Benefits of a P2P Ecosystem

Connectria, a 20-year-old managed services and cloud migration services provider with 180 partners, is "getting its feet wet" in the P2P ecosystem collaboration space by recently joining P2P Global. Jeff Swartz, Director, Channel Sales, Connectria, said, "our objective is to glue our partners together so not only do they get the benefits of doing business with us, but they also get the benefits of doing business with all of our other partners." For ten plus years, Connectria has been in IBM Power hosting business but has been branching out into managed services for AWS, Azure, and Google Cloud. Connectria is successfully conveying the message to its customers that it is essentially bringing them more value. P2P Global allows it to expand on the relationship that it has with existing customers. "Particularly over the last year, customers want to see more value from the suppliers they are doing business with, not value addition but value creation. Value addition is akin to selling hardware which is a race to the bottom with very little money,", says Jeff Swartz.

One of the core tenets of channel-ready products is that they are 'designed for relevance, rather than elegance' – that they predictably address a defined issue, rather than being designed so that they can be applied to address a range of potential issues. Resellers then build these products into turnkey solutions that help a target audience to achieve a defined outcome. One result of this approach was that vendors connected to partners in a 'hub and spoke' model, where multiple partners relied on one vendor for a component of a turnkey solution, and the vendor relied on numerous partners to deploy their products within well-defined target markets.

Ecosystem Partnerships

John Guido, CEO, and Founder, P2P Global Inc., has a great perspective on the IT channel and provides valuable insight, saying, "We developed P2P Global to help facilitate P2P engagements for channel partners – to help them solve for skill gaps. In the end, while our platform is easy to use and very efficient, it is only a tool. If a solution provider believes they can deliver more customer value and competitive advantage by leveraging an ecosystem approach, then they will also need to create a company culture that embraces scaling partnerships. While we know our platform can help deliver ecosystem value, we also know continuing to scale membership will be critical to further our value proposition. I believe vendors and distributors will be key to scaling and enabling their channel partners to participate in platforms like ours."

In the "as-a-service" world, a solution is based not on a defined hardware/software configuration but the orchestration of multiple on-demand services integrated with existing legacy systems. In an important sense, this is a liberating factor for the channel partner. However, it also means that channel partners have to increase their collaboration with other channel members, not opportunistically but frequently, similar to what PEAK Resources (a DMR), Connectria (an MSP), and CohnReznick (a consulting firm) are doing.

Small and midsized businesses find it challenging to defend their users, applications, and data against external threats. Data from Techaisle’s SMB and Midmarket security research reveals 63% of US SMBs report that they experienced one or more cyberattacks in the last year, contributing to an average of 3.6% of revenue loss attributable to security incidents. For 46% of SMBs, preventing cyber-attacks is one the most pressing and critical IT issues. Yet, 59% of SMBs are very confident that their firms could recover from a cybersecurity incident. Nevertheless, security issues cast a long shadow over SMB IT priorities, especially as firms embrace the benefits of hybrid work, hybrid IT, only to find that their environments become more complex and more challenging to manage and protect. SMBs respond by expanding security budgets – but they lack the staff and expertise to construct effective shields around their organizations. The channel, working with leading-edge products like those from Fortinet, Cisco, Dell Technologies, Palo Alto Networks, has an essential role to play in defending their clients’ SMB businesses against security threats.

The origins of the saying “it’s about the journey, not the destination” may be unclear. Ralph Waldo Emerson, theologian Lynn H. Hough, Canadian rapper Drake, or others may have said the phrase, but its applicability in an IT security context is clear. There is no endpoint at which security is ‘done’; security requires constant updating to stay current with expanding threat vectors.

This requirement for continuously improved IT security is both a challenge and an opportunity for security suppliers.

What is the opportunity?

Techaisle has pegged global SMB security spending in 2023 at $68 billion. However, high IT security spending levels and growth rates mask an underlying sense of confusion concerning safeguarding emerging cloud and hybrid IT environments – and a lack of resources to address this problem. Compounding – or perhaps, causing – the lack of clarity into cloud security issues and the relatively tepid adoption rates for cloud security solutions is that SMB IT operations are under-resourced. Without specialized staff, SMBs cannot keep pace with the constantly changing threat vectors and security options.

The lack of insight by small businesses becomes clear: only 5% have IT security staff. 44% of midmarket firms have an average of three full-time internal security staff, but the demands of a business of this size would exceed a single individual’s bandwidth. The percentages more than double for upper-midmarket firms. Simply put, SMBs lack the bench depth needed to dedicate IT resources to security. Everywhere within the SMB segment, there is a mismatch between available resources and the depth of the skills required to keep pace with security needs.

The lack of understanding of a threat associated with a widely-used platform on the one hand, and the lack of IT staff resources available to address security concerns on the other, produces a clear conclusion: SMBs need suppliers to step up to the delivery of secure IT environments.

In many cases, these suppliers will be the mainstream channel partners who supply the SMB’s technology and act as the IT management presence within the SMB’s business. In other cases, including in many midmarket environments, the source of security products and services will be specialized managed security providers who focus tightly on operating SOCs and protecting client environments. In some scenarios, firms will ‘land’ by entering a client account from one of these positions and then ‘expand’ to serve a broader range of IT supply needs – crowding out competitors who can’t address the risk and compliance issues that are central to the CEO’s mandate.

What is the security supplier call to action?

As security suppliers move towards managing SMB security needs, they need to address the pace at which their clients absorb new offerings. Small businesses will not embrace eight new technologies, nor are midmarket firms going to integrate fourteen new solutions into their environments. Even if this were possible from a budget perspective, it would cause chaos in the business.

Instead, suppliers of security services need to co-create a security roadmap with their SMB, which starts with assessing the customers’ executive teams’ tolerance for risk. What absolutely must be secured, and in what order? The security supplier can then identify the solutions that best fit the customer’s immediate and longer-term needs and then deploy, integrate and manage the solutions over time. After all, data shows that 45% of SMBs feel it will be beneficial for them if an external services firm can help define and implementing security policies.

One key point of exposure in this process is the ability to ensure that different solutions work together. In the cloud world, and increasingly in the on-premise world as well, channel partners and MSPs focus on integrations: the breadth of a single vendor’s product line, plus – and importantly – the extent to which third parties develop and support links to a firm’s products.

There will be no slowdown in the digital transformation of SMBs; their business infrastructure will increasingly rely on technology. Likewise, there will be no slowdown in the threats to that infrastructure; as reliance on technology increases, so does the potential bounty for attackers. And as a result, there will be a continuous and growing need for IT security services – which will sustain firms adept at delivering and managing security solutions that combine expertise and industry-leading technology.