The mid-market conundrum
© Quocirca 2013 - 2 -
How to achieve ‘best
class’ IT application delivery with limited resources
Mid-market organisations live or die by the quality of the applications that drive their business operations; from sales generation through supply chain management to post-sales services. Similar IT complexity to that in large enterprises has to be managed to support these, but with more limited resources. Somehow, the aspiring
needs to achieve peace of mind, confident that these applications are consistently delivering the desired business outcomes.
Mid-market CIOs recognise that they must deliver desired business outcomes
The majority of mid-market IT directors already have a CIO (chief information officer) mind set. They focus on applications over infrastructure and take a holistic view of both the application and the supporting infrastructure to ensure delivery of the only thing that really matters; the desired business outcome. Only when this is the case will they achieve the peace of mind that a given application will perform reliably, be available and secure on a day-to-day basis and free up time to focus on other strategic initiatives.
Best-in-class applications are a key competitive asset for any mid-market business
97% of mid-market organisations transact directly with users from partners, customer organisations and/or consumers and 72% of their employees rely on access to applications to do their jobs. On average the number of external users engaged with is 40 times the number of internal users; for some organisations it is considerably higher than this as they run hundreds of thousands or millions of external transactions per year. Any inefficiency or inaccuracy that results from poorly implemented or integrated business-critical applications is instantly visible to key stakeholders and will lead to competitive disadvantage and lost revenue.
Mid-market businesses need the capability to scale people, processes and technology
Most mid-market IT leaders recognise that if they rely on internal resources alone, they will not be able to deliver best-in-class applications. On average they have 73 users per IT staff member; with smaller organisations being half as efficient as larger ones. So most work with third party IT service providers (ITSPs) to gain access to scalable resources including people, processes and technology. Mid-market businesses cannot afford the upfront capital and on-going investment that this requires, but ITSPs can as they share the costs across multiple customers.
Finding partners with the right skills who are willing to engage is a key challenge
Mid-market businesses are typically not of interest to most large system integrators, and they become less interesting the smaller they are. Companies with just a national focus are also less likely to deal with larger providers. The quality of service provided by smaller IT service providers (ITSP) that do focus on the mid-market is variable and inconsistent; all too often the experience is disappointing and for a better-than-expected service to be delivered is a rarity. This explains why their mid-market IT directors are often serial experimenters.
Help with facing up to current IT trends must be part of package
Mid-market organisations accept that new technologies are a key part of the solution to their challenges, including support for mobility and cloud-based services that provide an opportunity to enhance operational efficiency. Help is also needed in other areas such as big data and consumerisation. Mid-market IT directors and their management teams need access to partners with proven skills and capabilities to enable them to harness these technologies with confidence and in a way that ensures the desired business outcomes are achieved.
Both end user organisation and ITSP need a partnering mind set to succeed
A better experience of working with ITSPs is usually reported if both parties see a partnership as the basis for the relationship. However, many mid-market organisations engage on a tactical basis, which leads to fragmented overall delivery. They struggle to find the right balance, with the number of suppliers going up and down over relatively short timescales. Those organisations that seek to engage in a true partnering fashion, with risk shared between both parties, are the ones that will achieve real long term benefit from their ITSP engagements.
The mid-market conundrum summarised:
The problem for mid-market IT directors is to find ITSPs that focus on applications and business outcomes rather than technology alone and that have access to scalable resources; this is as much about values as it is about capability and competence. The end user organisation and its ITSP need to share the risk involved and when this is the case both should benefit from the success that follows.