Ben Worthen at the WSJ wrote a very compelling piece last week – Start-Ups Emerge as Tech Vendors of Choice. Owners of sub $50m businesses should take note of Ben’s points:
- Vanguard Health Systems spends $100m on technology and buys from the Big Guys. However they chose Explorys Inc, a start-up to help spot trends in clinical data. Why? Costs were less and the software could get up and running faster.
- Many CIOs with large tech budgets say smaller companies are now quicker to embrace new computing models, have products that are easier to deploy, and tend to respond better to customers than the giants.
- CIO Executive Council gave their top vendors a score of only 3.23/10 across 20 categories. I call it the complacency of the big boys.
So as the owner of a SMB are you focused on winning business against bigger and stronger competition?
Ian, I guess I would take issue with the question:
“So as the owner of a SMB are you focused on winning business against bigger and stronger competition?”
Many competitors may be bigger but I question the stronger part. If they are rated only 3.23/10 by their customers they clearly are not stronger in the eyes of the customer.
What I have often seen is that larger companies get much more internally focused and SMBs are much more outwardly focused. This makes them much more responsive to the needs of their customers.
The real challenge for companies like ours, a small company is two fold:
1. Older entrenched ways of the people we would sell to. When we sell green fields we are fine, when we sell into a current operation it is more difficult.
2. The older and larger companies often have a market presence, marketing dollars and entrenched systems in place. They are only stronger in that they can often throw money at the problem. However, that only lasts so long if they are not innovating.
Thanks for posting this, it is important for small companies to keep their eye on the ball. Remaining outwardly customer focused will help them succeed in the long run. We are betting on it.
Very well put Paul. It comes back to a basic selling proposition worth believing in: focus on the business results you can deliver for your customers.