Sachin Bhardwaj, Director Marketing & Business Development, eHosting DataFort shares his views on the growing adoption of cloud infrastructure by the SMB sector.
IDC had forecasted that Small and Medium Businesses (SMBs) will spend $564 billion on IT hardware, software, and services, including business services, in 2016. This amount is expected to increase at a compound annual growth rate (CAGR) of 4.2%, reaching $668 billion in 2020. It also predicted that the Middle East will be one of the fastest growing regions over a five-year forecast.
Middle Eastern governments are proactively providing very strong grounds for the growth of SMBs in the region. This has given rise to a greater interest in new and advanced technology to fuel growth and business processes. Technologies such as the Cloud, digital transformation, cyber security, etc., are not just limited to deployment by large enterprises anymore. They have been gaining traction within the SMB market too for revenue growth, building a solid customer base, business performance and the sector is making significant investments in their technology spends.
As a long-standing Cloud Infrastructure and Managed Services provider in the UAE, we are witnessing a high rate of SMBs across business sectors, who are now understanding the need to putting their workloads in the Cloud. Many of these organizations are relying on the professional and skill sets of Managed Service Providers to integrate, manage and maintain their IT infrastructure and applications.
Barriers to technology adoption among SMBs
Business dynamics are changing at a rapid rate across the globe, setting the pace for both strong opportunities as well as challenges. One of the most widely accepted norms for business growth is the unprecedented increase in the use of technology. However, while most organizations are willing to accept the importance of technology, the maturity levels do not correspond accordingly and serves as one of the most significant barriers in technology adoption.
Often, there is a gap between the ‘Boardroom’ and the ‘IT Department’, where due importance is not provided to furthering IT investments, be it infrastructure, IT professionals, etc. Viewed mainly as technology experts, few IT heads are given their rightful chair in the boardroom to ensure that technology is discussed, not just as an enabler, but as a possible and crucial part of business strategy. It is certain that when technology leaders are part of strategic discussions, they are in a position to understand and provide a more holistic approach to the technology needs of the organization.
To leverage the growing benefits of technology, organizations must have the right skill sets to manage and maintain their IT systems. However, many organizations have been reducing the amount of money they spend on IT staff despite requiring new skills. This in turn is increasing the use of Service Providers to tackle their IT needs as they have the necessary skills and processes needed to complement this reduction in internal resources and budgets.
Cloud Infrastructure Services – the perfect fit!
According to IDC’s Worldwide Small and Medium-Sized Business Forecast, SMBs are spending more on software and IT services and will continue to rise through to $700 billion in 2019. The main reason for increasing investments in IT is that they are looking at alternative technology that will help them gain a competitive advantage.
As in other sectors, the SMB market too is looking at gaining a competitive edge through technology. Middle Eastern governments are laying strong emphasis on digitization which sets the platform for the SMB market to also adopt and implement the latest technologies to keep up with the regional business environment. This has spearheaded the growth of Cloud Computing in the region.
Cloud infrastructure provides SMBs with robust systems that can help them scale their IT needs depending on their requirements. These businesses avail of the services of Cloud providers for their Cloud infrastructure requirements. It works as a cost-effective measure that is contracted on a yearly or monthly basis, with some service providers giving an option to pay-as-you-go. This takes care of significant budgets which would otherwise be allocated for IT Infrastructure and applications.
The flexibility provided by a Cloud Service Providers is an added advantage for SMBs. From availing of business applications that are utilized on a need basis makes is convenient for SMBs to upgrade or downgrade services at any time depending on their requirements. It brings along greater benefits by being able to start small and increase the usage of services as needed to match business growth.
