SMBs to lead the way out of economic downturn 31 March, 2009 By Chris Talbot

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"The key takeaway for us is we wanted to make sure that we're aligning very, very closely with our small- to mid-market customers, and the ... partner community that services those customers," said Corinne Sharpe, director of Canadian reseller channel at Microsoft Canada.

Sharpe pointed out that SMBs account for 50 per cent of gross domestic product (GDP) and 90 per cent of employment, and their ability to be agile and keep close ties with customers is what helps them to steer the general economic out of downturns. SMB employees represent such a large percentage of the population, and they continue to try growing their business and being competitive without access to stimulus packages from the government, she noted.

Based on research conducted in the U.S., Canada, France, the U.K. and Brazil, Sharpe said that fact rings true throughout all of the geographies the study focused on. What also rings true is the important role that IT plays during an economic downturn, she said.

"What we're seeing from the study as well as from when we're talking to our customers and partners, IT is having to take a broader shift in how they support the business," Sharpe said.

The business is expecting IT to make decisions about technology that will reduce operating costs, increase employee productivity, and attain and retain existing customers, she said.

The top IT investment area among SMBs is that of server consolidation and virtualization, the study found.

"That came out on top that businesses as well as the partners were focused on," Sharpe said, adding that Microsoft was happy to see because of Hyper-V being included in Windows Server and offering a way for customers to get into consolidation and virtualization.

Four key areas of IT investment were identified. Server consolidation and virtualization was at the top of the list, followed by employee productivity and the ability to support remote workers (which Sharpe said is critical to attracting and retaining talent), business intelligence and customer relationship management, and software plus services. In fact, Microsoft expects to see a 10 per cent increase in Canada alone in software plus services by the end of 2009, she noted.

"We've been talking to our customers for quite some time about software plus services ... and we just launched the Business Productivity Online Suite," she said. The Microsoft Business Productivity Online Suite was designed to give customers some flexibility in an option they didn't have before, she said.

Although SMBs are seen as those that will lead the way out of the economic downturn, they're not without their challenges. They have lower IT budgets, but have to do more with them, Sharpe said. Yet they have to make strategic investments in order to give a boost to the bottom line.

"What [partners are] telling us in Canada is the customers are anticipating they're going to invest as much or more than in previous years," Sharpe said, adding that it's a good positive message at a time when there's a lot of negativity.