In all sectors, the last two years were tough – and as a result, 2022 is challenging from a market planning perspective. As we enter 2022, IT product and service suppliers are looking to create a context for understanding the range of outcomes that the new year may bring. Techaisle is launching its "2022 in Focus" research series to support that effort, which illuminates issues and requirements in the vast SMB and midmarket segments. To begin with, here are our top 10 (and additional 3) predictions for 2022. After surveying thousands of SMBs and midmarket firms, having hundreds of depth calls, we identified over thirty trends. After that, we systematically prioritized ten predictions for your consumption.
We look forward to working with you in the year(s) to develop fact-based perspectives on the issues that shape the success of the IT industry.
1. SMB security will move to holistic, but suppliers will need to be in the price range
SMBs will emphasize the importance of holistic security approaches that consider people, processes, and technology. Realizing that the entire organization is only as secure as the weakest link, SMBs will look for ways to capitalize on opportunities to strengthen the overall security posture. Suppliers will need to provide clear evidence of and support for best-available security and privacy via their product/platform and be within the price range of SMB buyers. However, suppliers will find it challenging to reach the potential buyers because they will be unable to identify the right marketing mix to intercept the demand.
2. SMB IT spending will increase to counter inflation, labor shortage, supply chain concerns
In addition to rising inflation and supply chain issues, SMBs will struggle to find qualified employees to fill job vacancies. The forecasts do not look too optimistic in the forthcoming quarters. As a result, SMBs will look for ways to streamline business and IT processes to best return on existing human capital. In the pursuit of greater efficiency, SMBs will explore options that help stretch budgets and use efficiency-oriented techniques to help to optimize the impact of labor shortage, inflation, and supply-chain issues. SMBs will invest in PCs, analytics, cloud, security, UCaaS / CCaaS, customer experience solutions, and networking. However, IT services will see the highest proportion of IT spending.
3. Momentum will build for business outcome-focused IT consumption model adoption
The business outcome-focused consumption model will provide a direct path to tying SMB IT investments to business objectives and value realization. The biggest driver will be connecting consumption costs to usage by giving IT services cost control to business management, managing the department's costs. In addition, however, SMBs will seek supplier guidance to precisely define the value and benefits of outcome-focused solutions based on consumption agreements and cloud solutions.
4. Establishing a digital infrastructure network will come into sharp focus
SMB business operations start with, rely on, and get constrained by access to capable digital infrastructure. Networks are a clear pain point for SMBs as they embark on digital transformation to align with the emerging requirements of the post-pandemic world. Networks are the critical link providing the connectivity that unlocks all other digital opportunities and potential. Security (including SASE) and SD-WAN (software-defined wide-area networks) will be vital issues in establishing a network foundation that will support the SMBs' hybrid requirements arising from digital transformation initiatives.
5. Office-less, Hybrid work will be a work in progress
SMB workforce structure has evolved to a mobile, distributed model that relies on communication and collaboration technologies, rather than brick-and-mortar buildings, to link people and ideas and generate results. SMBs' growing focus on enabling the hybrid worker will reflect investment patterns in cloud technologies, mobile applications, and access devices. However, with the hybrid work model, SMBs will have lingering concerns regarding networks/data security and privacy, misgivings over employee productivity, concerns about employee morale, and a sense of isolation.
6. SMBs will work with all hyperscalers but will have one preference
As SMBs accelerate cloud adoption, they will seek to understand and optimize the balance between advantages (such as compressed time to market for products/services based on a cloud) of focus within a single cloud vs. multi-cloud, which increases total available options and complexity. There will not be a one size fits all answer that will apply across SMB segments. Some SMBs will have an appetite for multi-cloud benefits but will lack the internal resources to manage across clouds, while others may follow the advice of their suppliers.
7. SMB IT staffing time and efficiency will splinter and stretch
Cloud adoption, hybrid work environments, and interdependence of IT infrastructure and business applications to enhance organizational productivity will splinter and stress IT staffing. SMBs will distinguish between IT-as-an-important-force-in-driving-business-strategy and IT-as-a-supplier-of-management-and-integration-services. The former will spend much less time on "IT" than "business strategy." The latter will likely divide into two, with one part focused on connecting cloud business applications. In contrast, the second group will focus on the on-premise product (e.g., PCs) acquisition, configuration, deployment, and support. These approaches will be subject to intense cost pressure, as outsourcing to the channel will become an attractive option.
8. Customer intimacy will drive cloud contact-center solutions
Focus on customer acquisition, customer retention & customer satisfaction will drive cloud contact-center solution adoption and customer service-related business process evolution. High-growth SMBs committed to a holistic digital transformation strategy, mature cloud adopters, and SMBs that identify as very innovative will move towards AI-driven chatbots and integrated contact center solutions. First, however, SMBs will have the arduous task of identifying suitable suppliers that meet their needs of price, support, reliability, security, and manageability.
9. Enhanced IT services for digital transformation will become time-critical
SMBs' interest in digital transformation will be a unique business driver for scale-up IT services. The fear of digital inequality will be acute. To accelerate migration to support a mobile workforce, anxious SMBs will prioritize automation, application bandwidth, and analytics, each of which requires services outlay. SMBs will increasingly need support for hybrid IT environments spanning conventional and cloud infrastructure. There will be an urgent need to provide business consulting aligning cloud capabilities with SMB's business requirements, map specific cloud services to these needs, integrate cloud services with existing infrastructure and each other, and provide ongoing support. SMB issues in servicing hardware at home will demand home office software/hardware packs for service.
10. Who, what, where, and why: Identifying high-growth, IT spend SMB buyers will test IT suppliers
SMB buyer personas, care-abouts, and the buyer's journey will supplant the notion of the marketing funnel. SMB Suppliers will have to map sticky content to digital pathways traversed by high-priority targets. It will be a demanding task since many vendors lack direct experience with SMB customers and prospects, managing them programmatically rather than individually. Suppliers will realize the value of understanding and analyzing how an ever-wider range of SMB decision-makers research, investigate, and select IT products and solutions.
11. SMBs will build the Edge, take Edge plunge
As SMBs develop digital foundations, innovative SMBs will build an edge by building the Edge. These SMBs will find that edge computing delivers significant business benefits: improved customer experience, cost efficiencies, revenue growth, better productivity, and streamlined internal business processes. Spurred by these achievable goals, other SMBs will also begin to use edge solutions to facilitate collaboration, supply chain visibility, asset tracking, and cost efficiencies; and for objectives as diverse as patient tracking and location-based marketing. SMBs will build edge solutions on a flexible, responsive hybrid core, with intelligence everywhere in the fabric, relying on dense networking to ensure that the data they collect and the process is available throughout the business environment.
12. Cloud business application automation overlays will be non-optional
To have a future-ready business strategy, SMBs will find that combining structured output from core systems with unstructured information will develop actionable perspectives. This state of inflection will create new opportunities for IT suppliers to overlay applications such as ERP, HCM, financials, and CRM to deliver edge, analytics, AI/ML opportunities. The automation overlay will help address business challenges by identifying threats, justifying new market expansion, tailoring services or product offerings, controlling costs, or meeting growth objectives.
13. SMBs will show a strong adoption trend towards cloud servers
Suppliers in the virtual infrastructure world will need to prepare to meet the needs of small businesses (primarily, ease of purchase, migration, and support) and midmarket companies (support across hybrid environments). Suppliers of on-premise infrastructure will need to tailor their marketing message to midmarket buyers and emphasize capabilities in supporting environments that rely on both physical and virtual infrastructure.