Get documents about "99.7_ of firms in the Canadian market have less than 500 employees
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Document Sample
99.7% of firms in the Canadian
market have less than 500
employees 991796
31284
Number of Businesses
14433
6846
1595 1178
Small
97.7 % Medium
2.04% Enterprise
0.26%
1-49 50-99 100-199 200-499 500-999 1000+
Company size by employee
Source: Stats Can, Business Register June 2003
Canadian SMB IT market spending hits
C$9B in 2004…and growing!
$11,000 $9.08B $9.38B $9.67B $9.94B $10.2B • 2004-2008 CAGR:
$10,000 • SMB (1-499) 3.1%
• Small (1-99) 2.6%
$9,000
$2,035
$1,860 • Med. (100-499) 3.4%
$8,000 $1,719 • Hardware 1.8%
$7,000
• Services 4.2%
$3,437
$3,131
$6,000 $2,897 • Software 4.3%
$5,000 • SMB Market Drivers:
$4,000 • Services
$3,000 $4,682 $4,787 • Replacement cycles
$4,464
$2,000 • SMB Market Inhibitors:
$1,000 • Canadian Economy
2004 2005 2006 2007 2008 • IT Credibility
Hardware Services Software
Source: IDC Canada October 2004
SMBs account for 27% of
Canadian IT external spend
Home
10% Small
11%
Coverage Challenge
Competitive Challenge
Medium
16%
Enterprise
46%
Large Small 1-99
18% Medium 100-499
Large 500-1000
Enterprise 1000+
Source: IDC 2004
What telecom projects are
SMBs adopting?
At what stage in the implementation cycle are the following telecom and communication infrastructure projects over
the next 12-18 months?
Internet connectivity 75% 7% 16%
Network security
61% 18% 17%
infrastructure
Virtual private networks 46% 15% 37%
Wide area networks 42% 9% 46%
Teleworking/Mobility/UM 32% 20% 43%
Wireless LAN's 24% 22% 52%
Call centre technologies 16% 8% 74%
Implementation Complete/Rollout in Progress Acquisition/Piloting/Considering No Plans
VoIP Usage Remains in Infancy
Stage - SMB
N=400;Does your organization currently use VoIP? Is it the predominate system in your
organization?
0.00%
200-499
4%
Company size by employee
0.50%
100-199
10%
0.90%
50-99
6%
0.30%
1-49
7%
VoIP - Usage VoIP - Predominant
Source: IDC Canada, 2005
Primary Benefits of VoIP
Adoption - SMB
N=400; Which of the following do you consider to be the primary benefits of adopting a
VoIP solution?
Reduce cost of
business
24%
operations
26%
Long distance/toll 10%
savings 19%
Reduce cost of
Telecom/network
14%
operations
7%
Improve employee 14%
mobility 7%
Improve customer 5%
interactions 12%
Source: IDC Canada, 2005 Small 1-99 Medium 100-499
VoIP Triggers for Adoption -
SMB
N=400; From the following list, what event(s) or issue(s) actually triggered or would
trigger the adoption of a voice over IP solution? – all that apply
Replacement of PBX equipment
64%
58%
Want to fully leverage existing IP-based 47%
network 42%
Re-organization 40%
39%
Office relocation
38%
38%
New office/branch opening 34%
42%
Critical business issue or pain 34%
39%
Source: IDC Canada, 2005 Small 1-99 Medium 100-499
Primary Business Inhibitors to
Adopting VoIP - SMB
N=400; What are the TOP business inhibitors preventing adoption of a voice over IP
solution?
Capital investment 37%
is too costly 26%
Don't fix what isn't 21%
broken 21%
Lack of business 15%
needs 21%
Senior management 10%
resistance 16%
Waiting for a robust 7%
application/solution 13%
Source: IDC Canada, 2005 Small 1-99 Medium 100-499
Primary Technology Inhibitors
to Adopting VoIP - SMB
N=400; Of the choices you selected, which would you consider your TOP technology
challenge?
Cost of upgrades to existing IT 30%
infrastructure 28%
Quality of service issues 12%
14%
Network can't carry additional data traffic 17%
7%
Current technology doesn't meet 7%
business needs 12%
Security concerns 10%
9%
Legacy IT/ Telecom environment 8%
concerns 7%
Source: IDC Canada, 2005 Small 1-99 Medium 100-499
Who has influence in the
‘Identify Need’ stage?
Within your firm, who plays the largest role in influencing the formal purchase
decisions at the „Identify Need‟ stage of the technology acquisition cycle in 2004?
IT Manager & Bus Executive
IT Manager
54%
47%
43%
20%
5% 5%6% 3% 8% 7%
3% 0% 0%0%
100-499 500-999
CEO CIO CFO
CTO IT Manager Business Executive
Executive Committee Source: IDC, iPanel 2004
Unlike enterprise market - SMBs buy on
pain, where need triggers action
Window of Opportunity
Pain
Time
Inefficient Sales Efforts
Typical Selling Cycle
SMB Technology Buying Behaviour
‘Need’ originates from both internal
and external forces for SMBs
What influence do the following groups have on WHAT technology
products/services your company buys?
Head “Every single piece of
Office software, including our
Staff accounting systems are
43% approved by our client.”
27%
(Oil and Gas)
Suppliers
Customers
11%
41% “100% - There are
12% certain things you
35%
need and certain
27% 28% things you must do
right down to where
your training is done –
all mandated by
Ford.” (Automotive)
Significant influence Some influence
N=905
Who has influence in the
‘Allocate Budget’ stage?
Within your firm, who plays the largest role in influencing the formal purchase
decisions at the „Allocate Budget‟ stage of the technology acquisition cycle in 2004?
36% 33%
IT Manager
CFO
24%
16% 17% 17%
13%
9% 8% 10% 10%
3% 4%
0%
100-499 500-999
CEO CIO CFO
CTO IT Manager Business Executive
Executive Committee
Source: IDC, iPanel 2004
Who has influence in the
‘Evaluate Alternatives’ stage?
Within your firm, who plays the largest role in influencing the formal purchase
decisions at the „Evaluate Alternatives‟ stage of the technology acquisition cycle?
77%
69%
IT Manager
IT Manager
8%7%
2% 3% 6% 5% 3% 3% 7%0% 7% 3%
100-499 500-999
CEO CIO CFO CTO IT Manager Business Executive Executive Committee
Source: IDC, iPanel 2004
SMBs look to the internet and
Peoplecolleagues for direction
• Friends
• Colleagues
• Customers
• Competitors Best Sources:
• VARs Informal Networks
• Consultants &
3rd Party sources
Internet
• Search engines (most common) “I Google it”
• Manufacturer Web sites
• Third-party websites (e.g. tomshardware.com, zdnet.com, experts)
• Webinars
Paper
• Vendor proposals
• Trade magazines & publications
• Technology publications
• Industry specific publications
Worst Sources:
Other Ads/Sales Calls/Mailings
• Industry associations
• Technical seminar
• Trade shows
Who has influence in the
‘Select Vendors’ stage?
Within your firm, who plays the largest role in influencing the formal purchase
decisions at the „Select Vendors‟ stage of the technology acquisition cycle in 2004?
83%
69%
IT Manager
IT Manager
7%7% 8% 4% 10%
3% 3% 0% 3% 3%0% 0%
100-499 500-999
CEO CIO CFO CTO IT Manager Business Executive Executive Committee
Source: IDC, iPanel 2004
Quality & expertise important factors when SMBs
determining where to buy
Importance of these factors when deciding whether to purchase direct from a vendor
or through an independent product reseller or services/solutions provider?
69% 65% 50% 48%
34%
39% 28% 21%
59%
53% 52%
46% 46% 43%
Very Important
33%
29% Important
N=908
A number of sources influence
where SMBs buy
What influence do the following groups have on where your firm buys
technology products/services?
9%
10%
41% 8%
34%
30%
27% 27%
22%
Some influence Significant influence
N=898
Partners are provider of
choice for SMBs
Name the one provider through which you purchase the bulk of your technology
products/services?
Partners 42%
"I like the idea of being able to put
Dell 21% my hands around somebody‟s throat
if something goes wrong. If they are
IBM 14% there when I need them, even if it is 4
in the morning - that is critical. I
don‟t like to be kept waiting.”
HP 11% (Professional Services)
"With a VAR you have a
Bell 2%
face - someone you're “I personally don‟t like
dealing with and someone working in a company where
Microsoft 2% to talk to. It's probably I‟m 50 or 100 people away
more difficult to call a from the top. I feel
vendor directly to get employees care much more
Telus 1%
anywhere." (Automotive) in a smaller company.”
(Medical/Health)
N=840
Top Vendors Groups for
Hosting Services
N=443; Who do you currently Buy HOSTING services from?
Telecom Vendor 25%
22%
Services Vendor 28%
24%
System Integrators 12%
7%
Retailers 1%
5%
Value Added 1%
Resellers 1%
Managed Internally 32%
35%
Small Medium
Source: IDC Canada, 2004
Churn - Plans to Change Long Distance
Service Provider in the Next 12 Months
N=453; How likely is your organization to switch to a different LONG DISTANCE
SERVICE PROVIDER in the next 12 months
Very Likely
4%
6%
Somewhat Likely
4%
5%
Neither Likely nor 9%
Unlikely 13%
Somewhat Unlikely
23%
21%
Not at all Likely
58%
53%
Source: IDC Canada, 2004
What is important to SMBs in a technology
provider:
– Understand their business
– Be there for them and build long-term
relationships
– Do not “force-feed” them enterprise
solutions
“I have a short list: spend time
– Solve their business issues not their in
with me and be an expert
your field. I know your
technology issues competition so tell me what you
know about your competition
“Vendors need to gear their sales pitch and why you are the best. Don‟t
and attitude towards us. We can‟t try to pull the wool over my
spend millions of dollars at the drop of eyes because I‟ve done my
a hat. There are smaller sales bites, research and so now you do
but with longer-term relationships” yours.” (Medical/Health)
(Medical /Health)
Who has influence in the
‘Approve Purchase’ stage?
Within your firm, who plays the largest role in influencing the formal purchase decisions at
the ‘Approve Purchase’ stage of the technology acquisition cycle in 2004?
34%
Owner/C-Level Exec
Owner/C-Level Exec 30%
23%
20%
15%
13%13%
9% 9% 10%
7% 7%
5% 3%
100-499 500-999
CEO CIO CFO CTO IT Manager Business Executive Executive Committee
Source: IDC, iPanel 2004
