7 SMB Technology Predictions For 2013

What's in store for small and midsize business technology in the New Year?

Kevin Casey, Contributor

December 19, 2012

7 Min Read

9 Bargain IT Tools For SMBs

9 Bargain IT Tools For SMBs

9 Bargain IT Tools For SMBs (click image for larger view and for slideshow)

As we move headlong into 2013, it's time to dust off the crystal ball and play fortune teller.

I asked several analysts for their take on the year ahead in small and midsize business (SMB) technology. I sprinkled in a few of my own thoughts, too, including a confidence rating of high, medium, or low. (Consider the latter the longer-odds picks.) Without further ado, here are 7 IT predictions for SMBs in 2013.

1. A Growing Gap Between IT Haves, Have-Nots

Around this time last year, the folks at the SMB Group coined the phrase "progressive SMB," referring to smaller firms that prioritize strategic IT spending tied directly to bottom-line growth and other business initiatives. SMB Group partner Laurie McCabe described the less strategic flip side of that coin: "I get technology when I have to, but I don't think that proactively about it," McCabe said in an interview.

There will be a growing gap between the IT haves and have-nots in 2013. The latter will fall behind the former on a wide range of business technology fronts such as mobile, cloud, social, virtualization, and analytics -- enough so that the back of the pack may never catch up. SMB Group data shows that 85% of SMBs with increasing IT budgets expect revenue growth in the coming year, compared with just 38% of SMBs with flat IT budgets and 42% of firms planning to decrease tech spending in 2013.

The good news: That "progressive SMB" segment is growing, according to McCabe. She attributes that in part to an increasing number of companies founded by young entrepreneurs and tech-savvy professionals who were laid off during the recession.

Confidence: Medium

[ Will you make any new IT hires in the New Year? Read SMBs Spending On IT, Not New IT Hires. ]

2. Revenue -- Not Cost -- Will Drive IT Decisions

Techaisle CEO Anurag Agrawal said that the seismic shift in how SMBs acquire technology -- thanks to cloud, mobile, and other categories -- has encouraged firms to more clearly connect those investments to business initiatives instead of fretting solely about budgets.

"Now that we are moving quickly away from capital budgets, revenue has become the focus rather than tight cost control," Agrawal said via email. "Enabling rapid growth is one of the keys to technology investment for SMBs."

That corresponds with a growing influence on IT spending from other areas of the business, such as sales and marketing departments. As a result, Agrawal predicts SMBs will invest more in CRM, marketing automation, business intelligence, and other revenue-centric platforms in the coming year. "For IT purchasing, the CMO will be as important as the CIO over the next five years," Agrawal said.

Confidence: High

3. The Rise of Hybrid IT Roles

With more SMB IT pros getting out of on-site infrastructure support and other legacy roles, they'll be able to elevate their profile elsewhere in the business. In smaller, more agile organizations, expect hybrid IT roles -- those professionals fluent in the language of both IT and marketing, for example -- to become more visible. It's not a particularly large leap, given how many SMB professionals already fill multiple job functions beyond their actual job title. McCabe of the SMB Group expects that interdisciplinary approach to be especially evident in spending and strategy decisions.

"IT may be just as influential in the decision-making process, but the business people really get it," McCabe said. "They may sometimes be leading the charge."

Confidence: Medium

4. Office 365 Goes Legit

You're not stepping too far out on the ledge if you predict SMB cloud usage will continue to grow. But Techaisle's Agrawal made a specific cloud call that requires a bit more gumption: 2013 is the year that Office 365, the online version of Microsoft's popular productivity software, goes mainstream. He points to increasing bandwidth speeds, reliability, and mobility as several macro reasons why. According to Techaisle research, 10% of small businesses (under 100 employees) are "actively investigating adoption" of Office 365.

"10% may not seem a lot, but that is enough to cross the chasm," Agrawal said. "Many young entrepreneurs are used to Google Docs, and in the new age of collaboration, moving to an Office 365 environment is logical."

Microsoft's going to do its part to make this one come true. It recently launched a 90-day free trial of Office 365's small business tier for companies with up to 10 users. The offer followed quickly on the heels of Google's announcement that it will no longer offer the free version of Google Apps, Office 365's biggest cloud competitor.

This one depends largely on how you define mainstream. If you agree with Agrawal that 10% is a significant number, then the prediction seems plausible in 2013. If you raise the bar much higher -- say, to the point where SMBs are just as likely to use Office 365 as they are to have traditional Office licenses -- it seems like a much longer-term bet.

Confidence: Low


Bring-your-own-device is already well on its way to becoming standard operating procedure in many SMBs, and 2013 will cement it as the default setting. "BYOD is a given," Agrawal said. But it won't be a free-for-all. More companies will turn to a mix of technology and policy to bring order to the BYO environment. "SMBs will adopt mobile device management solutions in record number," said Analysys Mason analyst Patrick Rusby via email. The firm projects more than $189 million in cloud-based MDM spending in 2013, Rusby said, "as SMBs find it more difficult to manage and secure the plethora of mobile devices across their organizations."

Confidence: High

6. Say Hello To Server-less SMBs

SMBs have been shedding servers for a while now as cloud and virtualization usage has skyrocketed. As those technologies move from "trend" to "normal," I suspect we'll see a growing number of SMBs that abandon the server closet altogether. In the case of well-established companies with lots of legacy systems, it may be more likely a drastic reduction -- from 50 servers to 5, for example -- rather than complete elimination. But a growing number of new businesses and branch offices will operate with no on-premises servers at all -- further freeing up IT pros to pursue those more strategic, hybrid roles mentioned above.

"The SMB server and network will become less visible as they progressively move offsite physically and from a remote management perspective," Agrawal said.

Confidence: High

7. SMBs Get Social Fatigue

My inbox is stuffed with end-of-year predictions about social business. The general theme: 2013 is the year SMBs "get serious about social." I'll offer an alternative view: 2013 will be the year that a growing segment of SMBs experience social fatigue.

That's not to say that companies will suddenly start deleting their Facebook Pages and Twitter feeds en masse. They'll continue to maintain a basic social presence because they feel they must, but they'll grow tired of staying current in a constantly changing social landscape. They'll become especially frustrated with their inability to quantify the bottom-line impact. (The low confidence rating below is more a recognition that this prediction itself will be difficult to measure.) In effect, these SMBs will simply be going through the motions.

"SMBs will continue to struggle to determine ROI from their social media initiatives and its usage will be considered a productivity drainer for already lean-staffed SMBs," Agrawal said. "Aggressive SMB adopters will realize benefits but many others will be disillusioned unless advised, encouraged, and shown a path by early adopters."

Confidence: Low

Tech spending is looking up, but IT must focus more on customers and less on internal systems. Also in the new, all-digital Outlook 2013 issue of InformationWeek: Five painless rules for encryption. (Free registration required.)

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About the Author(s)

Kevin Casey


Kevin Casey is a writer based in North Carolina who writes about technology for small and mid-size businesses.

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