BANGALORE, INDIA: Faced with almost a saturating enterprise market in the country, providers of IT solutions and services are aggressively targeting the small and medium business (SMB) market.
Though these growing companies fall under the SMB category, some of them are growth-focused and view IT as a strategic tool to achieve business goals. In order to tap this market, which holds a lot of promise, companies are treating small and mid-sized companies on par with large enterprises by offering products and solutions that fit this space best.
Ashok Pamidi, director for commercial accounts, HP India Sales Pvt. Ltd., shares his views on how emerging companies are fast growing to become a large enterprise. He also gives an overview of mid-size businesses in India
"Today's emerging/small and medium businesses (SMBs) in India are witnessing fast growth and are becoming corporate houses of tomorrow. Instead of calling them SMBs they are best addressed as mid-sized businesses," says Pamidi.
With HP aggressively targeting the SMB market in India, the company has registered a growth of close to 60 percent in its business from this market in 06-07. "We have seen that 140 SMB customers of ours have today become enterprise customers," says Pamidi, adding, "Our customized products in the SMB segment grew by 75 percent last year."
HP, which did very well with its Enterprise Servers last year, has expanded its reach from eight locations to 20. "We saw good growth in the Integrity Server sales by roping in more partners. This is our hallmark in the Enterprise service," he adds.
Overview of growing and mid-size businesses
With the focus shifting towards mid-market space in India, HP got a survey done through AMI Partners to know the reason for this major shift.
Talking about this, Pamidi said, "Today, outsourcing is not limited to ITeS and the BPO industry alone. Most of the large companies are outsourcing their jobs to small companies i.e., mid-sized businesses.
According to the survey, the reasons for shift are -
· Demography and population
· Business relocation
· Consumer affluences
· Services shift
· Outsourcing & privatization
Apart from production, innovation/PLM, human capital, performance management and supply chain, it is noticed that global expansions, merger and acquisitions also act as important business issues that propel the IT needs of mid-size companies, he adds.
"We need to understand that different imperatives lead to business processes that in turn leads to IT needs," says Pamidi. The new reality is that 'IT no longer supports the business, it powers business'.
With mid-sized businesses talking about mitigating risks, lowering costs and accelerating business growth, HP is aggressively looking at its business technology portfolio - Business Information Optimization and Adaptive Infrastructure.
Highlighting the infrastructure pain points among mid-market companies, Pamidi said: "The study revealed that a majority of SMBs felt that the IT environment was too expensive to manage and maintain." They felt that there are too many applications, lot of customization and too many underutilized services. Small and mid-sized companies are actually struggling to meet service level agreements, he added.
In order to reach out to the mid-size market with a complete software, hardware and service solutions, HP and Oracle have joined hands to deliver complete business solutions.
"This single point solution from a single source is sure to add value to growing businesses in India, and the ERP market is the biggest growth engine," says Pamidi.
The cost-effective, low-risk Oracle and HP solutions enable growing businesses in India to achieve a tangible return on their IT investments.
To promote the new offer, HP and Oracle have kick-started an 18-city tour 'HP-Oracle Accelerated Road Show' with customer-focused events.
HP, which saw a big success with the launch of its integrity servers targeted at mid-size companies in 2007, has sold over 2,500 servers. "As a company we are also exploring the 'Pay as you use' model through partner networks," he said.