IBM Australia is taking a cooperative approach to taking on the small business marketplace. The vendor recently assembled five of its key small business resellers in Sydney to discuss ways of tackling the marketplace together, with the aim of developing strategies and programs it can propagate throughout its channel.
This group represents the first five of IBM's Business Centres, and is made up of IC Technologies, IT Services Group, Business Computing Systems (BCS), WJ Moncrieff and Logical Solutions. According to IBM's Jeremy Pollard, they represent the vanguard of a con- certed attempt to find a better way to meet the needs of the small business marketplace.
Pollard says IBM research has shown that in Australia there are 795,000 small businesses that can be categorised as having 1 to 49 employees. He said that, of this number, 26 per cent still haven't bought their first PC, while the median expenditure on IT for businesses in this segment is only $1200 per annum.
"These aren't encouraging statistics, until you consider that there is a small group of around 10 per cent that spend over $10,000 per year," said Pollard. "What that tells you is there's a whole lot of people who find this whole process so daunting they haven't even dared go near it yet.
"When we went out and talked to some of those businesses that were buying a reasonable amount of IT, they told us that they weren't terribly happy with the process of acquiring technology.
Understanding small business
"But rather than IBM saying we know how to fix this, we took a slightly different approach, and said let's go find some dealers that are successful in this marketplace."
The result has been the meeting of the five business partners. Pollard says IBM's role in the process has been to be both a catalyst for discussion and a repository for the information collected.
The end result should mean that prospects are helped and supported in a consistent and friendly way, said Pollard. "They are going to be a lot happier, and get more benefit out of the technology that they acquire. And the dealers that work in this way find that they have a more pleasant interaction with the customer, and make some money too."
According to Nick Setchell, general manager of participant company IT Services Group, the key to servicing to small businesses is to understand how they work. "I think there's a media perception that IBM doesn't necessarily have an understanding of small business. But they're being very sensible in how to approach this, by going to dealers that have very close relationships with small business, and in many cases are small businesses themselves.
"So what this has been about is to identify how we can approach this group as effectively as possible, while utilising some IBM resources and some good ideas that we've each had."
Brand name power
The process will also see partners combining resources and expertise when it is of mutual benefit, said Andrew Rouse, managing director at BCS. "We've all got specific skill sets as well, and they're all working really well for us. So we're putting all that together, to give the customers the benefits. And that means that if we need different resources to get something done very quickly, we can do that through a relationship, and the customer benefits."
One such area is leasing. Pollard says it is here that the diversity of resources within a company such as IBM can really come to the fore. "Because of the credibility we have working as a group, it's easier to go to other parts of IBM and ask, 'can you design us something that looks like this?' And in the past, one dealer wouldn't have been listened to. Now it's a group, and we're starting to get results."
Pollard says IBM can also bring to bear its power as a brand name. "Small businesses are really nervous about a lot of things in their environment, and they're really looking for brands that they know and can trust."
The group will now go away and put some of the things it has learnt into practice, before meeting again to compare notes. From there it will seek to extend group membership. "We as a cooperative are going to be defining a profile for success, and basically going out to the marketplace and inviting people to join us. In other words, if you feel that you have these qualities, and would like to work in this way and achieve these results, give us a call.
"We think there's probably a lot of dealers out there that would really like a new way of doing business."
While IBM will remain the core technology for the group, Pollard said it will also take an agnostic approach in areas. "We're talking with a whole lot of other suppliers to invite them to participate in this, because we recognise that while IBM's got a lot of great technology, we don't have everything. So we want to work with Microsoft, Novell and Telstra, and a lot of the specialist software companies, and invite them to join the thing as well."
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