Moving to a ‘Cloud-Only’ IT Paradigm

|||Moving to a ‘Cloud-Only’ IT Paradigm

Last month, I attended Salesforce’s annual conference, Dreamforce. This year’s Dreamforce was the largest to-date, with more than 170,000 registered attendees, reflecting the growing popularity of the company’s core CRM software as an easy to deploy, flexible platform for hosting sales and other front-office related processes.

While Salesforce is typically viewed as a company that services midmarket, over the course of its 16-year history, the platform has effectively scaled out to be considered a leading CRM package for many large enterprises and government agencies. That said, Dreamforce 2015 featured several SMB-specific developments that effectively brought the smaller customer directly back into the conversation.

For instance, the SMB keynote featured Desk.com, a Salesforce product operating as a virtual start-up within the larger company. Desk.com provides an all-in-one solution to manage the customer support function across fixed and mobile devices, and is aimed squarely at small businesses and start-ups. A Desk.com-driven first-annual Start-up Summit brought in hundreds of new attendees to Dreamforce, many of whom were small business owners and managers keen to collect best practices and network with peers and investors. And finally, SalesforceIQ for Small Business, an intelligent, out-of-the-box CRM solution that can be set up in minutes, was a major focus at the event.

Cloud and mobile, along with business intelligence software providing access to insights culled from big data, are quickly mitigating company size as an inhibitor on competitive advantage. Across the IT market, phrases like ‘on-premises‘ and ‘mobile first’ are giving way to ‘cloud-only‘ and ‘mobile-only.’

Much of this can be traced to how industry heavyweights have pivoted to emulate Salesforce’s ‘cloud-only’ model. Microsoft CEO Satya Nadella quoted that Microsoft’s SaaS business is now driving $8.5 billion in revenue, with momentum being generated from SMBs’ Office 365 subscriptions, growing at a rate of 50,000 monthly. This is a turnabout for a leading IT vendor historically known for dominating on-premises computing and infrastructure, and validated the Dreamforce 2015 theme of platform partnerships.

My view is that additional vendors will start to take a second (or third) look at the SMB space by building common applications around more advanced capabilities, like analytics, rather than simply offering basic turnkey capabilities, like email and device management, which have characterized the SMB cloud market to-date. While the market for cloud BI is rife with start-ups, we see the major software brands that have already built channel strategies and an installed base of smaller customers have this advantage to already effectively reach the broader market, as long as the right mix of features can directly solve a particular business problem.

Chris Chute VP of IDCChris Chute is a Vice President with IDC’s Small and Medium Business Practice, providing strategic guidance to IT vendors and buyers regarding the development and deployment of cloud and mobile IT solutions. Mr. Chute’s research often centers on market disruption, such as the impact of hosted applications and infrastructure on small and medium business IT consumption, and how BYOD has reshaped IT policy requirements. Follow Chris on Twitter: @chrischute

 

IDC Analyze the Future

2018-09-17T15:32:28+00:00