Techaisle Blog

Techaisle’s US SMB and Midmarket SaaS adoption trend data shows that 73 percent of small businesses (1-99 employees) and 97 percent of midmarket firms (100-999 employees) are using one or more SaaS application categories. 37 percent of SMBs (1-999 employees) are using < 5 SaaS categories, however, 28 percent are using more than 10 SaaS categories (driven by midmarket firms). Overall 72 percent of SMBs are currently using 10 or less SaaS application categories but planned adoption indicates there is room to grow for the SaaS market within the SMB segment. The pace of SaaS automation is being governed by business & IT challenges, security posture, deployment and integration capability and point of purchase. Initial SaaS adoption has been for non-core business processes; however, 57 percent of mature adopters are using SaaS for core business processes. Techaisle survey data also shows that 64 percent of SMBs are using collaboration-focused SaaS solutions and 60 percent finance focused, however, future plans indicate that 62 percent will use customer-focused SaaS solutions.

As per Techaisle, US SMB and midmarket firms are forecast to spend US$25.6 billion on SaaS solutions in 2019.

Techaisle has released its annual research infographics on top 10 IT priorities, business issues and IT challenges of SMBs (1-999 employees), midmarket firms (100-999 employees) and small businesses (1-99 employees) for 2019. In its detailed SMB survey Techaisle investigated 21 different technology areas and several technology sub-categories, 23 different IT challenges and 21 different business issues. This is the 9th year of Techaisle’s annual survey research initiative that probes for top business issues, IT priorities and IT challenges. Tracking history provides a fascinating evolution in which new business goals drive new IT priorities and uncover challenges that must be addressed to enable progress on business objectives.

Primary research was conducted among senior IT and business decision makers from Techaisle network of 1.2M B2B IT professionals spread across 30+ countries.

There are some interesting differences in IT priorities as compared to 2018. IoT and VR/AR fell below top 10 (but still within top 15) and replaced by Voice/Digital assistants as well as Open source solutions. Across all regions (US, Europe, Asia/Pacific, Latin America) digital unified workspace and software-defined are becoming a priority for both SMBs and midmarket firms. Security many places within the top 10 IT challenges in different forms – cloud security, mobile device security, data protection/recovery/business continuity – with Cloud security as the top IT challenge.

Global SMB & Midmarket IT spend (excluding telecom services) in 2019 is projected to be US$665B and corresponding cloud spend is expected to be US$115B. Research also found that IT budget growths in 2019 will be the highest in Asia/Pacific (6.2%) and lowest in Latin America (1.8%). While IT budget constraint is not the top challenge within SMBs in the US and Asia/Pacific, it is the top concern in Latin America.

Managing data growth is continuing to pose challenge for SMBs and when probed further Techaisle research found that only 11% of SMBs and 29% of midmarket firms have evidence-driven culture with data-driven decision-making business processes in which data defines requirements or opportunities and management then determines the best option for moving forward. In the US, 17% of small business and 34% of midmarket firms consider themselves to be innovative.

2019 Top 10 SMB business issues, IT priorities, IT challenges

Dell has been aggressively peppering both the digital and print media with its enterprise storage campaign “running circles around everyone else”. It has reason to do so. Dell has come a long way from a dorm in Austin, TX to the corporate offices and consumer households globally. And Dell is doing all it can to take its channel partners, which are Dell’s extended sales and deployment team, along a fraught put potentially rewarding journey.

Dell’s channel momentum has not yet peaked. Q3 YoY channel order revenue grew by 21% as compared to 14% YoY reported in Q1. Distribution remains one of Dell’s fastest growing routes to market, having 19% Y/Y growth in Q3 (same as Q1) and through three quarters, accounting for roughly 40% of Dell’s overall channel mix. In early 2018 Dell had set a target of reaching US$50 billion in channel revenue and by end of 2018 it was at US$49B in orders (pending Q4 financial results). It has now set its sight at US$70B, timeframe as yet unknown.

Regardless of the success achieved, Dell continues to modify its partner program. Actually, it can be argued that continuous tinkering with the program has helped Dell to drive channel partner growth. While the core tenets of Simple, Profitable, Predictable remain, in February 2019 Dell has added three imperatives: 1/ making it easier for partners to do more business with Dell, 2/ fast-tracking partners’ ability to deliver transformational solutions, 3/ embracing and monetizing emerging technologies. Is Dell being very smart in using financial incentives’ levers to drive quarterly growth and revenue share and missing out on long-term transformation of its channel partners to efficiently participate in multi-cloud, connected business future? Is Dell focusing on the end zone without regard for down and distance? Let us analyze.

A Techaisle survey of nearly 900 midmarket firms on Digital Transformation trends in the US found that more than one-third of midmarket businesses – 34% - view digital transformation as a means of driving product innovation. Regardless of whether the ‘product’ that an organization produces is a physical good or a service, there is likely a link between DX and breakthrough design and delivery.

In both products and services, the key links between DX and product innovation are insight and agility. As the graphic below shows, these themes permeate the key business issues, innovation objectives and digital transformation drivers that shape the strategy of ‘holistic’ organizations – the most advanced DX users in the midmarket. These firms are using DX to respond to a set of imperatives that set them apart from their competitors.

Senior executives in midmarket organizations care about digital transformation – and as a result, channel members can leverage their understanding of key Digital Transformation objectives and roadmaps into long-term, sustainable relationships with senior decision makers.