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Small and medium businesses (SMBs) are investing in IT to boost their business. Looking at this positive trend and backed by statistics, Microsoft India looks at the country and especially the SMBs as the growth driver for the IT industry in the coming years. Rajeev Mittal, Group Director, Small and Mid-market Solutions and Partners, Microsoft India spoke about the company's plans in the Small and Medium Business (SMB) segment to AC Ganesh of CIOL.
 Why is Microsoft targeting SMBs in a big way?
The SMB segment will be the growth driver for the entire IT industry over the next few years. According to a recent joint study conducted by IDC and AMI Partners, there are 1.9 million small and medium business with computers and 30, 000 mid-market entities in India. As per analyst estimates, these SMBs are geared to spend $7.7 billion to beef up their IT infrastructure.
Small businesses are increasingly viewing IT as an essential strategic tool for their business instead of just another technology investment. In this context, we view SMBs as a very important market for Microsoft India.
What is your strategy for targeting these markets?
Our strategy to address this segment is three fold - increasing product relevance, extending partner reach, and strengthening customer relationships. We are doing several things in each of these areas to increase our reach into the SMB segment. Our solutions have been built ground up to meet the business needs of SMBs and are easy to implement, use and support.
We understand that the needs of the small businesses are different from that of the mid market customers and therefore provide heterogeneous solutions to them. In the last year, we have launched Dynamics Navision 4.0 (includes ERP, CRM and SCM) as well as Dynamics CRM 3.0 in India and will continue to introduce new offerings as per customer needs.
To reach out to our customers, we have put in place a partner ecosystem of more than 3,500 partners.
Are there any specific verticals that you are targeting?
We work in partnership with ISV partners to target vertical markets. Our approach is that of providing broad horizontal solutions to our target customers and we look to our partners to provide that “last mile” of vertical-specific functionality. We do however target several broad-based industries – manufacturing, distribution, retail, textile, professional services and public sector – all of which have a diverse array of verticals within each.
What are the challenges you are facing in India?
One of the biggest challenges is the vast geographic spread within the Indian market – being able to reach the customer base. Also, there is the question of IT awareness within the SMB segment – communicating the value of IT and getting these customers to making strategic investments in IT is a task. Finally, we face the challenge of high level of piracy.
What are the future plans of Miscrosoft?
We continue to evolve and will introduce newer offerings as per the needs of our customer. Our offerings such as Small Business Server, Mid Market Server and Office for Small Business Edition are designed for specific segment keeping in mind the functionality requirement of ease of use, ease of learning and integration.
In future, we will also look to increase our customer reach. We have doubled our partner coverage from 16 to 32 cities. Further, to train our partners and provide them consultancy on the unique IT requirements of our customers, we have adopted a 'Hub and spoke model'. We have identified 5 hubs (Ahmedabad, Indore, Chandigarh, Coimbatore and Nagpur) in the upcountry region where we will expand our presence. These hubs will service our partners located in 30 spoke locations and service needs on SMB market in up-country geographies.
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