The pandemic has had a lasting impact on all businesses, and in particular on the SME market (99% of all global companies) that is focused on accelerating its digital transformation journey to drive its recovery. A recent report on business transformation published by Storyteller, revealed the share of companies in advanced stages of technology adoption and implementation. As Angus Ward, CEO of beyond now said, he found that 64% of organizations surveyed use digitized processes and data to improve efficiency, and an additional 68% use modern IT platforms.
As businesses of all sizes advance in their digital maturity, several technologies are considered essential to improving business resilience and efficiency, while reducing costs. Network security, cloud applications, multi-cloud infrastructure, 5G, Edge and IoT are all firmly on the radar of businesses.
SMEs, which make up the majority of the business market, are currently investing heavily in digital transformation. There is a real desire to move services online and adopt new tools, making it an attractive market where CSPs can help drive innovation and capitalize on new B2B revenue opportunities. The digitization of SMEs means that they too are gradually becoming software companies because of the proprietary data they generate. They want to be part of a larger digital ecosystem of services and are looking for partners to help them achieve this goal.
The expectation gap
For years, SMBs have had to deal with multiple solution providers to meet their needs. Now they are looking for a complete savior who can offer a range of solutions, without the added complexities. As their adoption of digital technologies and tools accelerates, SMB services revenue is projected to grow by 9.5% CAGR between 2020 and 2025, driven by public cloud, unified communication tools and next-generation collaboration and security services.
Long coveted by CSPs, SMEs are an essential asset in the 5G landscape and a [$433 billion (€424.78 billion)] income opportunity. Despite this, CSPs have seen this market as the “problem child” and have struggled to deal with it in the right way as they lack the volume of consumers and deep pockets of a large organization. However, SMEs perceive CSPs as their trusted partner for 5G. So what’s really stopping FSCs from exploiting this opportunity?
This is mainly due to a lack of innovation, speed and inability to purchase connectivity solutions directly from the CSP that meet the specific needs of an SME. SMEs can feel overwhelmed trying to solve technology and transformation problems on their own, relying on an average of seven different vendors to meet their ICT needs. Their needs are complex, so they need an organization with the expertise and specialization to help them get it right.
SME demand has not only caught the attention of CSPs, but also alternative service providers like big tech 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. Otherwise, they risk weakening their B2B value proposition and failing to grow beyond just being a connectivity provider.
Create new value through solutions
The secret of CSPs lies in “solutioning”. SMB customers are increasingly tech-savvy and aware of the benefits of deploying cutting-edge technologies. The challenge for them is that they simply don’t have the time, the resources, or the will to understand the technology and learn how to maximize its performance. What they know is that they want technology solutions that are simple to buy, quick to integrate, easy to consume, and result-oriented from a single source.
To capitalize on this opportunity and fend off competition from alternative service providers that are faster to approach this market, CSPs need to work collaboratively across a broader ecosystem of players and think about how they drive their digital markets. at the top level. The digital market trend is becoming commoditized, but so far they have been too focused on reselling unbundled technologies rather than complete solutions. It is critical that CSPs focus on developing and selling solutions through their digital marketplaces and with their ecosystem partners, rather than simply making multiple components and services available.
CSP efforts should focus on evolving the market model to co-create solutions with specialized vertical industry partners. On their own, they simply won’t have the capabilities to meet the general requirements of the SME sector. Partner co-creation is fundamental and CSPs are in an ideal place to orchestrate this partner ecosystem to foster an environment of joint accountability.
By co-creating with a variety of partners, CSPs will reduce the risk of trying solutions and improve their delivery models to launch quick deals and do it quickly to identify repeatable patterns and scale. Acting as orchestrators of these digital marketplace ecosystems, various partner specializations can be channeled into a single solution that meets the requirements of the B2B customer. This will allow CSPs to continue to launch and monetize new offerings and successfully scale their digital marketplace.
Now is the time for CSPs to begin. The SME market represents an ideal starting point to grow and establish value in the B2B sector, where CSPs can realize their ambitions to grow beyond connectivity and generate new revenue outside of their traditional business. consumer-centric.
The author is Angus Ward, Beyond Now CEO