Techaisle Blog

Techaisle’s SMB Cloud Adoption survey shows that SMBs that are using Cloud applications are experiencing tremendous improvement in customer acquisition, retention and work satisfaction. In fact, 1 in 4 SMBs say that customer retention has improved, and nearly 1 in 3 says that customer acquisition has improved.

In general SMBs have experienced improved customer acquisition and retention after using cloud applications, however, SBs (1-99 employees) and MBs (100-999 employees) differ. Typically, SBs are more hard-pressed to acquire customers, a top business issue for them. With the adoption of cloud, 32 percent SBs say that they have seen improvement. MBs on the other hand, have better direct sales force for customer acquisition, but after equipping the sales force and marketing with cloud applications they have seen marked improvement in customer retention. Additionally, an important point to note is that 29 percent of SBs have reported improved group productivity and 34 percent improved employee satisfaction.

The survey also showed that B2C and B2B SMBs have had different experiences in customer acquisition and retention.  Specifically, B2B SMBs have reported nearly twice as high improved experiences as B2C SMBs. Many B2C SMBs are using social media platforms such as Facebook and twitter and marketing automation solutions to build a set of followers to improve their customer retention and acquisition. On the other hand, comparatively higher percentage of B2B SMBs are using LinkedIn, Twitter and specialized platforms such as Chatter, Yammer and GageIn to track news and conversations with their customersaction.

CRM has become the central application and the core around which other features and functionality are deployed as required by an SMB organization, department within an SMB or an individual user within the SMB. CRM is that core cloud business application. After the SMB CRM base has been built (or simultaneously), the order of implementation depends on the SMB’s focus but is likely to be business intelligence, marketing automation, Financials, HR/Payroll, customer service for service companies, ERP, fulfillment (SCM) and industry vertical applications.

There are four key areas of SMB cloud usage and deployment. Each has got many sub-sets of applications. These four areas are:

1. Infrastructure and Platforms (US$13.0 Billion SMB Opportunity by 2016)


2. Communications and Collaboration (US$7.9 Billion SMB Opportunity by 2016)


3. Business productivity & Applications (US$15.5 Billion SMB Opportunity by 2016)


4. Industry specific applications ((US$2.7 Billion SMB Opportunity by 2016)

While there are many niche vendors addressing each niche area, the complexity grows manifold as businesses move from one application to another, from one device to multiple devices. As Cloud computing adoption among SMBs grows, the real issue of data integration continues to come into play and it will become imperative for each of the four areas to communicate with the other. And once that “integration enlightenment” happens SMBs will witness even higher improvements in productivity, satisfaction, acquisition and retention.

Anurag Agrawal
Techaisle

Announcement

Cisco has announced a new Cloud and Managed Services Program (CMSP) that integrates its currently existing Cloud Provider, Cloud Services and Managed Services Channel Programs (MSCP) into one. Besides streamlining incentives, discounts and payments for its partners, the program also aims to simplify pricing for Cisco-based cloud and managed services offerings. The program will also enable collaboration and sharing of complementary opportunities between partners through a microsite via Cisco’s partner portal. All partners are expected to transition to the CMSP by August 2013.

Techaisle Take

We believe that with one master move Cisco is strategically addressing the US$94 billion global SMB opportunity by 2016.

Techaisle’s global channel surveys have shown that Cloud, Mobility, and Managed Services Solutions together are changing the SMB channel landscape as these solutions are revolutionizing IT utilization by SMBs. The new paradigm would be the "3-in-1" Channels offering Mobility, Cloud, and Managed Services as a single offering. We first wrote about the 3-in-1 channel here. And now Virtualization is quickly becoming a potent arsenal in the SMB channel partners offerings.

Techaisle’s corresponding SMB research has consistently shown that SMBs want mostly integrated solutions to limit complexity and therefore seek partners that are capable of such deliverables but very few partners currently do so as they are all camped in either one or two solution corners and few seem to embrace a holistic solution view - and this is making SMBs unsure of overall benefits and desire to spend.

With its current announcement Cisco is removing some of the barriers by bringing channel partners serving managed services and cloud needs of SMBs under a common cluster. Since many SMBs want to obtain all services from a single provider, it is important for broad product/solution vendors to evaluate all their partners, seek and cluster partners based on where they are with regards to capabilities of delivering complete solutions and introduce programs to support development. As the dividing line between cloud and managed services is becoming thin, Cisco has just done it, that is, created a single program that should:

• Enable channels to build more dynamic and serious partner-to-partner collaboration to collectively address complementary opportunities


• Enable Cisco partners to add capabilities, such as, managed services to an existing cloud services


• Attract newer partners to join Cisco program


• Help current channel partners qualify and move up Cisco’s channel partner pyramid

The data on the right from Techaisle’s channel study (N=2851) shows that channels that serve the SMB segment are keen to offer multiple services that straddle cloud and managed services. Cisco’s new program should open up opportunity for its channel partners to offer both cloud and managed services using Cisco platforms.

If we look at the survey data at micro-level, we find that is a higher percentage of Channel Partners that are offering some type of Managed Services Solutions than they are offering Mobility Solutions or even Cloud Computing. The channels falling in the green columns will benefit immediately, those in the blue columns will find the program attractive but those within the red columns in the chart would be of immense importance.

It is clear that Managed Services has been the most important offering for Channel Partners, as they evolved from a typical value added channel to offering break-fix services and remote managed services.



The path being chosen by Channels to move from one offering to the next is strongly dependent upon their current offering. Those that are in the mobility space are moving to cloud, while those in the cloud are moving to managed services.

Understanding the channel dynamics and current offerings gives clues in the direction they will move. For those that are offering only one of the services there is a clear path to adding services. In fact Techaisle survey shows that the channels have chosen their path of selection.

Channels are also interested in offering mobility solutions, however, it is also clear that mobility has become possible due to cloud and managed services allowing employees to work from anywhere, anytime and from any device.

 

The responsibility now lies with both the channel partners and Cisco to make the program a success. However, there some other steps that Cisco needs to take as well.

• Extend the reach of its Smart Care to cover cloud based services


• Develop capabilities that not only work with Cisco's networking devices but also with client devices. Although it must be said that Cisco is addressing some of those needs through its partnerships with other vendors


• Further the agenda on not only BYOD but also just BYO


• Market the program aggressively. Channel partners are being courted and trained by many other vendors


• Use the program to establish a strong presence in the datacenter space

With the latest move, Cisco may have begun to shift the tide in its favor more decisively.

Anurag Agrawal
Techaisle

Symnatec just announced its Endpoint Protection Small Business Edition 2013 which effectively moves Symantec's flagship security solution for SMBs to the cloud. The solution has an on-premise solution as well giving SMBs the flexibility to start with an on-premise solution or use directly a cloud-based solution with no additional hardware requirements and no special IT staff or training needed.

Techaisle Take
In the SMB space, the trend is definitely moving to the cloud, with SMBs reporting growth in the average number of cloud applications rising from 2 in 2010, to 4.3 last year and expected to hit over 7 this year. Symantec has seen flat revenue in a growing market and needs to take advantage of this trend in cloud services. Security is among the most widely deployed cloud application (~60% of Cloud Users).  Symantec has a very broad portfolio of products and despite a management shakeup and unwanted attention from hactivists; they have been able to maintain stability over the past few years. Having said that, there is always some uncertainty when migrating from one architecture to the next; it will be very important to maintain a solid opportunity for channel partners and they will have to execute well as they make this move.

Symantec needs to ensure that their channel partners are well trained in the difference between between the 2013 cloud edition and the 12.1 on-premise version to avoid any SMB marketplace confusion. Symantec also needs to make sure that their marketing campaigns present the choice of offers as a benefit rather than a hard decision; there are benefits to both cloud and on-premises versions depending on the SMB customer need. We have found that there is a gap in demand from channel partners for cloud security services based on what they are hearing from their SMB customers – Vertical Applications, Security and Storage and Backup solutions top the list of requested applications.

All software companies are wrestling with or implementing cloud services strategies. After Cloud Security, which is a strategic imperative for Symantec, the largest opportunities within Cloud Infrastructure are in Remote Storage & Backup services, unless they step far outside their core business. SMBs recently reported that although their business priorities have remained fairly constant, 77% want vendors to reduce complexity in IT so they can focus on business and customers. It seems Symantec wants to enable that by offering both (all) their services through a common interface which is delivered through the channel and allows remote management of both On-Premises installed base and Cloud versions. If they can do this successfully, it should be a win for both small businesses and channel partners.  Even so, the devil is in the detail, and if they fail to bring both of these to the market successfully they risk losing credibility in their core security market.

Anurag Agrawal

Delivering Work-Life Harmony through Enabling Technology

Citrix calls it Life Slicing, a form of work-life harmony. And it is on a relentless pursuit of creating continuities between devices, location, apps, data, events and culture irrespective of place, time and environment. Mark Templeton, CEO says that he and his team are busy designing solutions that create customer experiences that will differentiate Citrix from its competitors and in the process reduce cost and increase simplicity for end-users.

It is not an easy objective to achieve. However it is the right objective. Citrix is either a leader in some categories or second in others and a relatively new entrant in yet other areas. It is confident that a focus on delighting the customer with tools that conform to the way end-users work in a multi-modal collaborative world, pining for utmost simplicity will make Citrix the winner.

To achieve its vision, Citrix has set its eyes on six key areas.

• Social Collaboration: with carefully selected and integrated product line consisting of – GoToMeeting, GoToTraining, GoToAssist, GoToWebinar, ShareFile and Podio. While GoToMeeting was Citrix’s first foray into collaboration (when collaboration was not yet a must have), recent acquisition Podio extends the collaboration to teams.

 

• Data Sharing: ShareFile is Citrix’s answer to enterprise-grade Dropbox that Citrix hopes will win on security, ease of use and customer service. ShareFile enables employees to send, share, sync files with business features such as follow-me data, access from any device, encrypted in transit and at rest, remote wipe and account locking.

 

• Enterprise Mobility: a strategy built on Citrix Receiver, a client software app that allows access to data, apps from any device for the unbridled, fast growing BYOD market. Citrix Receiver uses XenApp and XenDesktop to deliver self-service apps and data to over 3 billion devices. Add to it CloudGateway for provisioning that is identity-based, scenario-based and secure serving of data on apps whether the device is windows, mobile, web or HTML5.

 

• Windows-as-a-Service: an area which is the bread and butter of Citrix, a leader in the space with maximum number of products – XenDesktop, XenApp, XenClient, VDI-in-a-Box. Citrix is furiously working on delivering Windows apps and desktops as a true cloud service. RingCube and Kaviza acquisitions helped Citrix accelerate its presence in the VDI marketplace and eliminated the trade-offs with VDI to allow both shared and fixed desktops to be managed. In addition its HDX technology aims to deliver high-definition virtualization experience and its FlexCast delivery technology makes possible individual user configuration.

 

• Cloud Networking: echoing the thoughts of many others that the future network will be fast and flat Citrix is betting on NetScaler, ByteMobile and CloudBridge solutions to deliver a network fabric that meets or exceeds the demands of a mobile world with ever-growing bandwidth requirements from devices, data and applications that are in constant motion.

 

• Cloud Platforms:  staking on its belief that Open platforms will win, Citrix has CloudStack addressing the needs of both traditional and cloud workloads. Specifically, Citrix has also rolled out a Cloud Portal specifically designed for service providers that is a single self-service interface for cloud deployments.

Routes-to-Market for SMBs

The channel comprising of VARs, Systems Integrators (SIs), dealers, resellers and retailers form the essential cogs of an IT vendor’s eco-system that puts products and solutions in the hands of the customers. This is particularly true in the small and medium business market (SMB) where the vast majority of opportunity can only be addressed through the channel. Selling direct is not economical. So it makes complete sense that Citrix is trying to find ways to engage and involve the channel in their cloud efforts. With over 10,000 channel partners globally Citrix is concentrating on three different yet complementary efforts: 1/ Strengthen the VAR and SP channels; 2/ Build strategic alliances; 3/ Reach the SMB channels. The third point is most noticeable as Citrix has launched two new channel programs:

1. SMB Specialist

 

1. Cloud Advisor

SMBs have made the leap to cloud-based infrastructure and will rapidly move to multiple services that leverage their investments. The new solution stack is virtual and relatively standalone at this point; the next stage will require integration of more complex applications. As new Cloud Services are rolled out it will not be possible for most SMBs to maintain the internal expertise to make the most appropriate choices. Helping customers emerge without being overwhelmed and providing relevant knowledge of how to effectively apply the new technology will strengthen the SMB customer-channel-vendor relationship. And Citrix is building that channel handbook to enable its partners to be those trusted advisors.

In addition it has developed and released a Partner 360 Dashboard with real-time analytics. Its channel measurement and incentive metrics are based both on fulfillment and influence. Borrowing a leaf from the SMB transformation phenomenon, Citrix is enabling its partners to shift their focus from just operating to implementing and therefore helping them define their respective roles in the cloud.

Techaisle Take

SMBs are going through a transformation in terms of their work style, behavior and IT usage. Citrix is addressing the transformation. SMBs traditionally started off their journey into IT unknowingly using single building block concepts. The process for an SMB growth and its relative steps to absorb IT were steady and predictable. Some SMBs stacked their blocks faster than the others but the steps to get to the top block were always the same.

Enter flat IT. Cloud, mobility, virtualization, managed services have effectively toppled the blocks down in one fell swoop and have laid everything flat on the table. SMBs have moved from enablement to empowerment. Now it is not a race to the top, but how can an SMB reach its full potential in the shortest period of time. The process of an SMB’s growth and steps to absorb IT are no longer steady and predictable.

The SMBs are looking for value shift, moving from enablement to empowerment. They have moved from individual productivity to group productivity. Work from anywhere, anytime is more prevalent today than ever before. SMBs are no longer clustered in one location. It took 10 years for percentage of SMBs allowing telecommuting to double itself but only 3 years to again double to reach 77% in the US. The average number of locations has gone up from 1.05 to 1.85 in 5 years. Another important number to note – 15% of SMB employees always work from home, that is, 11 million SMB employees.  SMB executives have also accepted work at home culture. And they see it as a benefit for the company as well as employees. 46% agree that it benefits companies, 37% say that tasks can be accomplished from anywhere. And 28% say that the technology used by employees is more advanced than that offered by workplace. It is known as Consumerization of IT but it has implications on how IT is absorbed and how IT vendors offer support and training. SMBs use multiple devices & applications to collaborate when traveling or telecommuting, many of which did not exist 5 years ago. Mobility is at the SMB doorstep.

To address the SMB transformation Citrix has it all: Collaboration, Data sharing, Mobility, Virtualization and even flavors of managed services. In the process, it is introducing simplicity and mobility along with driving down the cost. But what about the routes-to-SMB-customer? This is where Citrix has some work to do. Recognizing the shortcoming, Citrix has launched a somewhat thought out campaign to serve the needs of the channel partners that cater to the SMB community. What it already has in its favor is the tail wind. But any fellow traveler can easily testify that the tail wind can turn into a head wind. Citrix has its work cut out for itself, making sure that the channel partner tail wind is maintained.

Anurag Agrawal
Techaisle