It’s likely that the conditions SMBs experienced since 2020 were and will remain unique: driven by a combination of a global pandemic and geopolitics, everyone was forced to rethink how they worked, or sink.
Those who chose “rethink” over “sink” keenly adopted the cloud, in a faster and deeper change than any technological revolution since the Internet made communications ubiquitous. In a recent commissioned study, Future of Operations 2023, Forrester canvassed South-East Asian (including ANZ) SMBs from the micro-business all the way up to 1,000 staff. It found adoption climbed 20% or more in all of the operational domains served by cloud offerings, whether infrastructure, productivity, security, business continuity, or business applications. The front-runners, cloud infrastructure, and development platforms for business applications, grew by 48% each.
The race to the cloud seems to have paid off for SMBs. Forrester’s data demonstrates successful cloud implementations helped companies grow their revenue between 10% and 19% from one year to the next. And that’s without mentioning other cloud-enabled benefits like better security and cost-effectiveness.
The businesses themselves said their priorities remain revenue improvement (86%) as well as a better customer experience (83%) – and as Forrester’s data showed, there’s still room for benefits to be realised, since in spite of two years’ uplift, the SMB segment still lags large enterprises.
Unlike large enterprises, SMBs can’t devote sufficient staff to their cloud journey to cover every need. Once they’ve taken the early steps – adopting cloud-based storage or office applications, for example – they quickly discover there are many other cloud services they need if they’re going to maintain their momentum.
In Forrester’s Cloud Maturity Assessment, surveyed scored an average 3.61 out of 5. They did well in “process”, followed by “technology”, but in “people”, SMBs were the least mature. Experienced staff are hard to find.
The skills squeeze leaves SMBs with a deficit in most cloud disciplines. The Forrester findings showed their top challenges using public clouds include managing security, cost, and consumption; while SMBs using private clouds struggle with software licensing, performance – and, like their peers on the public cloud, cost.
Forrester found SMBs are looking for third-parties for cloud strategy development in four out of five operational domains. They seek specialists that can support longer-term, strategic planning and end-to-end delivery of secure, performance managed cloud estates, including more advanced deployments such as cloud-native development and app modernisation. Capabilities in high demand include security, business continuity, cloud cost control and optimisation.
As a result, most businesses expect their budgets for external cloud service partners to rise over the next 24 months by up to 20%: 78% of micro-businesses; 86% of small businesses; 87% of mid-market businesses; and 84% of upper-mid businesses
Forrester’s survey respondents cited two primary factors in considering third-party service providers behind their decisions: 60% lacked the budgeted resource to do the work themselves, and 51% needed to rely on external knowledge.
There’s much more in the Forrester survey to help you see how well your business is aligned with SMBs spending intentions.
Most importantly, while they still have an appetite for cloud spending, it’s a good time to identify where you can expand your own offering.
Some resellers might want to introduce new services; others might get more benefit joining forces with complementary service providers. As cloud estates grow, you won’t only be plugging holes in your customers’ skills gaps. Internally, they might need help along. Externally, they might need help dealing with more vendors, as contract and licensing negotiations may stretch your customers’ in-house capabilities.
However, not all of your customers will be in the same place or have the same plans. Some might still be trying to work out what their next moves are, or going into a holding pattern for other reasons. They’ll be looking for advice from suppliers they already have relationships with.
That’s the time to be proactive: identify opportunities to help them identify how to get the most out of their existing investments, help them find gaps in their investments and capabilities, and demonstrate how filling those gaps will deliver the next round of revenue growth.
The more you can demonstrate your ongoing value to your customers, the better you can head off the risk that they’ll put your platforms or solutions under review.
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