SMBs require a solutions-based saviour, but here’s why CSPs must act fast to take the title

Angus Ward of Beyond Now

The pandemic has had a lasting impact on all businesses, and in particular, the SMB market (99% of all global businesses) which is focused on accelerating its digital transformation journey to aid its recovery. A recent business transformation report published by Raconteur, revealed the share of firms in advanced stages of technology adoption and implementation. As Angus Ward, CEO of Beyond Now says, it found that 64% of surveyed organisations are using digitised processes and data to improve efficiency, and a further 68% are using modern IT platforms.

As businesses of all sizes advance their digital maturity, there are several technologies viewed as key to improving business resilience and efficiencies, whilst also reducing cost. Network security, cloud applications, multi-cloud infrastructures, 5G, Edge and IoT are all firmly on the radar of enterprises.

SMBs which represent the majority of the enterprise market are currently heavily investing in digital transformation. There is real hunger for moving services online and to embrace new tools, making it an attractive market where CSPs can help to drive innovation and capitalise on new B2B revenue opportunities. The digitalisation of the SMB means that they too are gradually becoming software businesses due to the proprietary data that they generate. They want to become an integral part of a wider digital ecosystem of services and are looking for the partners to help them achieve that goal.

The expectations gap

For years, SMBs had to put up with multiple solution providers to address their needs. Now, they seek a well-rounded savior who can offer a range of solutions, without the added complexities. As their adoption of technologies and digital tools accelerates, it’s forecasted that SMBs’ services revenue will grow by 9.5% CAGR between 2020-2025, driven by public cloud, next-generation unified communications and collaboration tools, and security services.

Long coveted by CSPs, SMBs are a critical asset in the 5G landscape and a [$433 billion (€424.78 billion)] revenue opportunity. Despite that, CSPs have seen this market as the ‘problem child’ and struggled to address them in the right way because they lack the consumer volume and deep pockets of a large organisation. However, SMBs perceive CSPs as their trusted 5G go-to partner. So, what is really stopping CSPs from harnessing this opportunity?

It is primarily down to a lack of innovation, speed and the inability to purchase connectivity solutions directly from the CSP that fit an SMB’s specific requirements. SMBs can feel overwhelmed when trying to solve technology and transformation issues themselves, relying on an average of seven different suppliers to address their ICT needs. Their needs are complex, so they need an organisation with the expertise and specialism to help them get it right.

Demand from SMBs has not only attracted attention from CSPs, but also alternative service providers like large technology companies, hyperscalers and even fintechs. With these additional players in the market, CSPs must act quickly to be seen as their savior and work to deliver outcome-based technology solutions that meet a variety of business needs. If not, they risk weakening their B2B value proposition and failing to grow beyond simply being a connectivity provider.

Establishing new value through solutions

The secret for CSPs lies in the ‘solutioning’. SMB customers are becoming increasingly tech-savvy and are aware of the benefits of deploying cutting-edge technologies. The challenge for them is that they simply don’t have the time, resource, nor are they willing to understand the technology and learn how to maximise its output. What they do know, is that they want technology-based solutions that are simple to buy, fast to integrate, easy to consume and focused on an outcome from a single source.

To capitalise on this opportunity and fend off competition from alternative service providers who are quicker to address this market, CSPs need to work collaboratively in a wider ecosystem of players and consider how they take their digital marketplaces to the next level. The digital marketplace trend is becoming commonplace, but to date, they have been too focused on reselling unbundled technologies rather than complete solutions. It’s critical that CSPs focus on developing and selling solutions via their digital marketplaces and with their ecosystem partners, rather than simply making multiple components and services available.

What CSPs’ efforts must centre on is evolving the marketplace model to co-create solutions with specialist vertical industry partners. Alone they simply won’t have the capabilities to address the broad requirements of the SMB sector. Partner co-creation is fundamental and CSPs are in an ideal place to orchestrate that partner ecosystem in order to nurture an environment of joint responsibility.

By co-creating with a variety of partners, CSPs will reduce the risk of trialing solutions and improve their delivery models to launch fast offerings and do so quickly to identify repeatable patterns and scale. Acting as the orchestrators of these digital marketplace ecosystems, various partner specialisation can be channeled into a single solution that meets the requirements of the B2B customer. This will ensure CSPs can continue to launch and monetise new offerings and scale their digital marketplace with success.

The time for CSPs to start is now. The SMB market represents an ideal inception point to develop and establish value in the B2B sector, where CSPs can realise their ambitions to grow beyond connectivity and generate new revenues outside of their traditional consumer centric business.

The author is Angus Ward, CEO of Beyond Now

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