Australian SMBs step up the pace in consolidation and virtualisation

The pace of consolidation and virtualisation in the Australian small and medium-sized business (SMB) market is progressing at a considerable rate, according to a new IDC report.

The report titled “Consolidation, Virtualisation, and Storage Strategies in Australia Small and Medium-Sized Business: The Quiet Revolution” revealed that in order to deploy, maintain and grow a broad array of services and applications, Australian SMBs must continually add new servers and storage.

However, in doing so they are facing challenges such as rising costs, poor ROI (as servers are most often under utilised) and decreasing manageability due to the higher number of servers.

Jean-Marc Annonier, IDC's research manager for small and medium business markets told CRN that from an IT services perspective, there are not enough good mid-size IT services companies to service the whole SMB market.

“The good ones such as Axxis are flourishing because of that. There are a lot of small IT shops providing small scale services with a very limited portfolio, and often they cannot provide SMBs with sophisticated products and services,” he said.

Annonier said the service provider must act as trusted advisors and provide guidance to their clients. They must ensure that their services and products are specifically designed for SMBs and not a re-packaging of an Enterprise product,” said Annonier. “Simplicity is paramount but customisation must remain possible. Obviously appropriate pricing will be very important, so lowering operational cost through proper managed services back end systems and processes are very important.”

According to Annonier, the reality is that requirements of SMBs aren't that different from larger businesses.

“Their need for help is even more acute because they don't have access to substantial financial resources. So they really need proper IT products and services but often can't afford them,” he said.

When dealing with SMB customers, IT service provider must keep in mind three key information; Keep it simple: business owners don't really want to know about technology, but instead how they it can improve the business; Keep it short: rolling out a new system over 6 months just won't work for SMBs, operations can't be impacted; Keep it cheap: SMBs are price sensitive, the ROI model must be clear and simple.

“A main priority for SMBs is to increase server utilisation. Therefore education is very important, especially regarding virtualisation as many SMBs do not know/understand it,” said Annonier.

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