SMBs challenged to do more with less

SMBs challenged to 'do more with less'

SMBs are seeking to deploy more robust infrastructure and reduce costs via outsourcing and leveraging technology from experts and infrastructure hosting companies to streamline business processes

Usha Prasad

Monday, March 09, 2009

BANGALORE, INDIA: “In difficult economic times like this, enterprises should opt for a hosted model like NaviSite’s Dedicated Hosting solution, which has a broader appeal. We look to build upon this in the India market while brining newer technologies like virtualization and cloud and making them a reality for the enterprise market in India,” says Sumeet Sabharwal, MD, NaviSite India.

According to him, Virtualization, Cloud Computing, Green IT, and Social Software and Social Networking will be some of the top technologies to gain momentum and preferred by enterprises in 2009.

NaviSite, a leading provider of IT hosting, outsourcing and professional services for mid- to large-sized organizations, remains committed as ever to pioneering solutions that create value and market differentiation for mid-market organizations.

Excerpts from an interview:

CIOL: According to you, what are the top tech trends for Indian SMBs in 2009?

Sumeet Sabharwal: With declining revenues, SMBs are facing the challenge of the ability to 'do more with less' and are putting a lot of effort to increase efficiency by optimizing the existing IT infrastructure with reduced costs.

This would see the focus shift to server virtualization and Green technology. SMBs are seeking to deploy more robust infrastructure and reduce costs via outsourcing and leveraging technology from experts and infrastructure hosting companies to streamline business processes. The Green concept makes increasing sense as saving on resources like power drives higher ROI and savings for both the underlying hosting provider and the end-customer. This involves adoption of better data center technology, adapting the foot-print for increased efficiency and lower power consumption.

By doing so, SMBs are looking at cutting costs and saving operational expenditure to be utilized in business development activities, making data protection faster and cheaper, realizing better ROI of the investments they make.

CIOL: Are Indian enterprises (both large and SMBs) holding back in their IT spends in this year?

SS: India is still evolving in its IT domain and has a lot more potential than currently explored. While the current global economic turmoil will act as a damper to reduce spending plans by most Indian enterprises, the challenges they face are slightly different that the companies in western hemisphere. With the Indian economy still growing at six percent, and most business are being driven to invest more actively in the underlying infrastructure to achieve the efficiencies needed to compete with the larger, more established firms that may have the advantage of importing existing technology and infrastructure from their western operations.

According to a recent report published by AMI-Partners, IT expenditures by SMBs in the Asia-Pacific region will incrementally reach US$153 billion in 2009. According to the report, the region's SMBs will dedicate about 60 percent of their IT&T expenditure on telecom services and computing requirements, which includes printers and printing supplies, as well as PCs and servers. Indian SMBs are the fastest growing pool, with a forecast 8.5 percent growth in IT&T spending over last year--nearly double that of the average 4.5 percent growth for the region. SMBs across all industries in India, however, are expected to lower their spending growth rates by one to two percent this year, it noted.

CIOL: How is IT Infrastructure essential for enterprises in these times of slowdown?

SS: Economic downturns frequently result in larger focus on getting maximum return from business investments. In such situations one needs to be practical in identifying opportunities for both cost saving and investment. While IT may be forced to reduce its own costs, there is a growing realization that the effectiveness of IT can affect a company's overall cost position and strategically increasing IT spending can drive even greater costs out of other parts of the business. So, businesses now understand that automating routine manual processes or outsourcing their IT infrastructure in times like this offers very compelling economics.

Further, the argument becomes even more compelling when we take the increasingly scare capital availability into equation. Most SMBs are wary of tying up precious funds into the IT infrastructure given the present economic uncertainty, and are drawn to the appeal of a leased monthly model with greater flexibility to modify computing resources as required.

The ever present benefit of outsourcing remains in both good times and bad – it allows companies to focus on running their core operation and diverting most of their investments and resources on the business side vs. the underlying technology infrastructure.

©CIOL Bureau