Few among you would be surprised to find new, innovative, scrappy companies vying for a piece of the quickly growing technology market that services businesses of your size. But some of you might be surprised to find out how entrenched such old-line computer-industry standard bearers as IBM and Hewlett-Packard are in this market.
“Hewlett-Packard generates about a third of its revenue from the small- and medium-sized business market,” says Chris Ogburn, the company’s director of small and medium business sales in North America, “and that includes everything from ProLiant servers to small-scale color printers.” He adds that the company estimates that nine out of ten small and medium businesses own an HP product.
Buell Duncan, IBM’s general manager of ISV and developer relations, says that over 20 percent of his company’s revenue comes from the sector, and it’s growing. “We’re seeing growth rates of 10 percent or more per year,” he says, “and that’s compared to IDC’s estimate of eight percent for the sector and five and a half percent for technology overall.”
This is very good news for people like you: It means you’ll be offered a steady diet of quality products by companies you can reasonably believe will be there for years to come. That’s particularly important because both Hewlett-Packard and IBM are focused not just on hardware, but on technology services that will help you grow your business.
Hewlett-Packard has an array of products and services that are delivered under the umbrella of its Smart Office Framework. “There are three basic legs supporting the framework — Smart Advice, Smart Technology, and Smart Services,” says Ogburn.
HP customers, or people who are considering buying an HP product, can go to the company’s Web site and chat with a technical support person. For more in-depth counseling sessions, telephone support is also freely provided by the company to its customers. But before you do any of that, you can take online courses or just read the tutorial documents for any number of technologies available for small businesses from Hewlett-Packard.
“Smart Advice is very important for businesses that don’t have much in the way of IT resources,” says Ogburn. He added, “Where else can you go for telephone advice if you didn’t even use a consultant to install your technology?”
It’s no surprise that Smart Technology is comprised of the foundation products in Hewlett-Packard’s enormous hardware and services portfolio. Everything from an inkjet cartridge to a PDA to security services are in the portfolio and made easily available to businesses of your size. Some products come in a variety of formats that can grow with your business. HP StorageWorks Data Protector Express, for example, is a purpose-built data backup and recovery designed to enable a business of your size to protect its data from disaster regardless of operating system or hardware configurations, and without any traditional IT support to operate it.
Hewlett-Packard’s Smart Services is a consulting package designed to assist business managers assess their situations; plan hardware, software and services solutions; and implement them in the framework of a long-term plan that will enable their businesses to grow. “A key element here is security assessment,” says Ogburn, “because while all businesses today are vulnerable to attack, smaller businesses are particularly vulnerable, and we can help them find and implement the right solutions.”
“Smaller businesses have the same needs, but definitely not the same resources, as large enterprise businesses,” says Buell Duncan, “so it’s critical that we are smart enough to bring applications and resources down in size in ways that make it easy for them to use technology.”
Like Hewlett-Packard, IBM has three legs supporting its strategy. “The key for us to be successful with small businesses is to be smart about packaging, price, and ease of use,” says Duncan. But a major difference is in the strategy’s focus. Whereas Hewlett-Packard’s is centered on self-reliant businesses, IBM relies on its large reseller network to implement its small-business strategy.
The cornerstone of that strategy is the IBM Express Portfolio, which is available to certified resellers. The package is composed of more than 100 scalable hardware, middleware, service, and financing solutions that are designed to be easy to use in small-business environments. IBM has priced them for that market as well, although solutions in the mix can be scaled to serve medium-scale businesses of up to 1,000 employees. That means they can serve your business when it gets that large.
Applications in the IBM Express Portfolio cover a wide range of business types and needs, ranging from medical technology applications to RFID solutions for retailers to supply-chain management for manufacturers, and even more. The growing list also includes helper applications that enable dealers to create and install applications using Oracle, Siebel, PeopleSoft, and other third-party products.
And IBM has even more plans going forward. “We plan to take on two major initiatives,” says Duncan. “The first is to develop even more prepackaged applications, delivered either as services or as appliances.” Duncan pointed to the company’s recent acquisition of Corio, a company that provides hosted services, as a leading indicator of its services-oriented strategy.
Going along with that strategy is Duncan’s second play. “We plan to move more services into a subscription-based business model,” he says. That’s a strategy that some analysts feel benefits both IBM as a provider, because it allows better price control, and its customers, because they can have wider discretion over their use of the services.
Are You Really Surprised?
There is one number cited by Buell Duncan that tells you exactly why companies like his are establishing themselves as strong players in your market. Technology growth in the enterprise sector has slowed to just over five percent. Those of you who have been around the technology business for a while can remember when 20 percent or even 30 percent growth per year in the business sector was not unheard of. Today there are more businesses of your size than there have ever been, and your number is increasing daily. It’s likely that the rate of growth will speed up, and the rate of technology acquisition will grow even more. As a result, IBM and Hewlett-Packard are each trying to be your best technology friend, and so are Microsoft, Oracle, and many other big-time players in the technology business. And here at SmartCompany.com, we’ll do our best to keep you up to date with everything they are doing.