8 Technology Investments to Help Small & Medium Sized Businesses Dominate the Recession

When the economy takes a turn for the worse most business try and make swift budget cuts to give themselves a better financial runway. Usually these cuts impact Marketing and IT with great severity, when ideally these are the two areas you should be at the very least maintaining budgets. With that in mind over the next couple weeks we will be highlighting 8 areas where you can make relatively minor investments in technology to help your business Small or Medium sized business dominate in the recession by doing more with less to gain competitive advantages.

The 8 Technology areas that we will be highlighting:

1. Communications
2. Data Deduplication
3. Cloud Computing
4. Learning how to use the tech that you already have
5. Electronic Document Storage
6. Virtualization
7. Hardware Upgrades
8. Going Mobile

Why Sun Should Have Followed Apple’s Path

These days you don’t read or hear too much about companies deploying Sun Servers or workstations, you don’t read about the great advances in the Sparc Architecture, and you don’t read about how Solaris is powering the newest supercomputer. All of the things are what you would have routinely heard about ten years ago and through end of the dot com boom. Back then Sun was the platform of choice for enterprise computing and powering the latest web startups. Many a dotcom blew their VC funds on top of the line Sun servers to power their new next greatest thing. However, Sun has languished in light of cheap, but powerful, x86 and x64 hardware running Linux, which has virtually eliminated any advantages that Sun once had with their Sparc Servers and Workstations.

With their advantages dwindling Sun decided that they should jump on the mainstream bandwagon, by saying that they support Linux, building x64 servers, Open Sourcing Solaris, and buying MySQL. However all of these efforts seemed to be half-hearted measures to allow them to say they were doing these things, to get people in the door to talk to them about their Sparc closed source Solaris systems. They went so far as to start selling x64 workstations that ran, *GASP*, Windows.

Had Sun really supported these efforts they would have stopped selling a commercial version of Solaris and embraced a highly optimized, user friendly, custom version of Linux as their OS of choice that could run on any device they made. Furthermore, they would have limited their Sparc SKUs to the extremely high-end systems with everything else running x64. Finally, they would have embraced the consumer with gateway products to build their brand and suck new customers in, while building a hedge against market fluctuations. Does this strategy sound familiar? It should, its exactly what Apple did to not only maintain relevancy, but steal significant market share from Dell, HP, IBM, and Microsoft.

In Many ways Sun could have been bigger than Apple because they already had enterprise products, they just needed a consumer strategy, which albeit is much more difficult to create than an enterprise strategy. They could have accomplished this through an acquisition several years ago of a company like Suse, HTC, Creative Labs, or Macromedia. Anyone of these companies or any number of others could have vaulted Sun into the consumer space or have given them the tools to build really innovative consumer and enterprise level products.

Cisco, another dotcom high-flyer saw the writing on the wall about a dwindling enterprise market. This prompted them to make some strategic acquisitions to enter the consumer and small business space with Linksys and WebEx, among others. While not exactly the same, since Cisco does not make Workstations or Servers (at least until this week they did not), it is similar, they continued to serve their core market while bolstering their consumer offerings as a hedge against the separate market fluctuations.

But alas, they did not and in today’s news is that Sun is in talks to be acquired by IBM for nearly $7 Billion. However, I do not view this as bad news for either company because there are great synergies in products between the two companies. It is also not too late for IBM to still embrace a consumer strategy and get back into the workstation and laptop market that they should have never left.

Your Big IT Vendor Does Not Understand Your Business

Recently I have come to the conclusion that Big IT Services, Software, & hardware vendors do not understand small-medium sized companies. Most IT vendors seem to fall into one of two categories, the first is Big Enterprise Vendors that think you are or want you to be larger than you are, and fast. The second type is the Small Time Vendors that do not understand what business goals are and how they impact IT, and are quite fine fixing your desktop computer when it breaks, which is fine for the very small company, but they do not scale well. Rarely have I seen a company that can fit comfortably in the middle.

You may be asking yourself, “What constitutes a Big IT Vendor?” These are the companies that you would expect that make hardware or software such as Cisco, HP, and EMC. Big IT Vendors are also the “Value Added Resellers” such as Insight and CDW, as well as your local/regional “Enterprise Consultants/Vendors” that resell hardware & software, in addition to offering consulting services.

Next, you may be asking yourself  “What constitutes a small-medium sized organization?” This one is a little harder to pin down, as it is not always dependent on a headcount of staff. I know of several smaller companies that have only a few employees but require networks and systems on par with companies that have 60 employees, due to the nature of their businesses. In general I would say these are your non-tech based companies that have less than 150 employees, but more than 15. Most companies in this category are happy with their infrastructure as it stands, no matter how broken and inefficient it is, because they do not know any better. They do not have IT Goals, they usually have a loose idea of what they want or where they would like to be, but those ideas are always at the mercy of what else is going on in the organization.

Most Big IT Vendors are fundamentally sales organizations, or at least the departments that you will get to interface with. This is true even with companies that “make” hardware and software, you usually only get to deal with the sales dept. rarely get to talk to anyone that is technical in nature, or if they are they are a Sales Engineer. A Sales Engineer is essentially a sales person that has a better understanding of the technology, but is still fundamentally a sales person. This is bad because sales people are typically paid on commission, so they are usually more interested in pushing units than finding the best solution for your company.

Without sounding like Jeff Foxworthy, you can tell that you are dealing with a Big IT Vendor that does not understand small-medium sized businesses when you starting hearing them say things like:

• What is your annual IT budget? – What they are really asking is “how much money can I try and get from your company?” This is a way for sales people to size your organization up. Again this is something that most small-medium sized companies do not have formally established (but arguably should).

• What is your budget for this project? – This is essentially the same as the previous one. Most small-medium companies would answer this with “what is it going to cost us? If we like the number that is our budget”

• What projects are you working on that we may be able to assist with? – This is question that goes along with the IT Goals question; rarely does an organization in this category take on large long-term projects. Projects that would normally be considered a large undertaking for bigger companies, such as deploying a new IP Phone system or Exchange Server, are fairly short-term projects simply due to the size of the organization.

• We will get a quote put together for this. – This one is a pet peeve of mine. If these companies would just publish a standard price list and not sell their products as a million different components there would be no need for formal quotes. Personally, I am fine working with rough ballpark numbers until I am ready to commit to buying the products. This is a classic way for Sales people to maintain contact with you to try and push you into committing to buy the product or service.

Furthermore Big IT Vendors tend to push Microsoft & Cisco, with some RedHat or Novell Linux peppered in, centric solutions.  They believe that everyone needs a SAN, a web filtering system, a full Unified Communications Solution, and they look at you funny when you say you allow your users to use *GASP* Macs.

These Big IT Vendors have their place in the world, which is servicing large Enterprises. However, with the economy in the toilet shareholders pushing for ever larger market share these vendors have no choice but to try and convince small-medium sized companies that they need to have the latest and greatest enterprise-level technology to make their business run more efficiently. The fact is that most small-medium sized companies do not need an excessively complex IT Infrastructure to run their business, the need a simple, stable, inexpensive environment.

Unfortunately, without Big IT Vendors, that leaves many smaller companies to deal with the small-time IT Vendors previously mentioned, which is often not a better situation.

Zimbra has 40 Million Paid Mailboxes

Venture Beat is reporting that Yahoo’s Zimbra has 40 Million Paid Email boxes, which is gives it more paid mailboxes than Google’s Free Gmail and it’s paying Apps (Gmail) For Your Domain customers, and puts it close behind AOL and Microsoft’s Hotmail services. While Zimbra’s users are not the same type of users as Gmail, AOL, and Hotmail’s users, in that Zimbra is not offering basic web mail services like the aforementioned services, they are offering something more significant in a full Groupware system with Calendaring, Email, Contacts, etc., and they are getting companies to pay for it, whereas the others, not so much. Much of Zimbra’s new found user base is due to the fact that Comcast has deployed Zimbra as it’s new email system for all of it’s broadband subscribers.

While Zimbra has made significant headway in aquiring new customers, they still have a lot to do to compete with Microsoft Exchange, with their biggest hurdle being acceptance by non-technical “office-type” users of using their own web mail interface over the traditional Outlook Interface. I ran into this head on when I replaced our existing Exchange 2003 Server with Zimbra. While the system was fairly stable, but less so than our Exchange server, their Desktop Connectors that linked with Outlook, Entourage, Apple Mail, and Apple iCal left much to be desired. These connectors were down right buggy and feature incomplete. With that said, if you can get your users to use their Zimbra Desktop Client or Web Client, the system was rock solid, and their Connector for Active Sync worked flawlessly.

I hope this milestone gets them noticed within the Yahoo corporate structure and gets them some more resources so that they do not get lost in the current Yahoo re org mess. I am still not convinced that Yahoo’s acquisition of Zimbra was a good move for either of the companies. As I have said before I still think that Apple should have bought Zimbra instead of creating their iCal Server.

It should be noted that I own stock in Yahoo.