Business apps surge

The SMB business applications market in the Middle East has continued to boom with vendors increasing their focus in this segment. For solution providers, this is a sector that offers solid margins.

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Business apps surge Doug Kennedy, VP, Microsoft Dynamics Partners
By  Clayton Vallabhan Published  June 26, 2012

The SMB business applications market in the Middle East has continued to boom with vendors increasing their focus in this segment. For solution providers, this is a sector that offers solid margins.

The market for SMB business applications is ripe with ample competitiveness. Customers have begun asking for more support and customisation, and solution providers are faced with dwindling price points to satisfy the demand. Solution providers have to also make sure that there is a lot more value in their offerings and positioned at a reasonable price for the ‘hungry’ SMB target audience.

“Global SMB IT spending crossed the half-trillion-dollar threshold in 2011 as companies stepped up technology spending to stay competitive,” said Raymond Boggs, vice president of SMB Research at analyst and research firm IDC. “Technology spending will continue to vary by company size, geography, and IT category, with PCs and servers setting the stage for advanced solutions across regions.” Boggs also noted that SMB IT spending will approach $700 billion in 2016.

While the SMB sector continues to show insatiable appetite for IT in general, the question is how much of this money will be spent towards ERP, CRM and other SMB business applications in the Middle East region.

Torben Pedersen, senior analyst, IDC MENA said: “As the software solutions market in the MENA region moves toward greater mid-market penetration, vendors will benefit from diversified offerings geared to the more modest needs of smaller organisations.

Paolo Juvara, CEO, Openbravo said the SMB business applications market in the Middle East is not very different from other markets around the globe. He said SMBs still lack an absolute solution to address their customers’ needs in a satisfactory manner.

Juvara said that most offerings are based on obsolete platforms. “From one side you have many local providers that are able to serve customers in the region very well with solutions that are very well tailored for the specific needs of local vertical sectors but that are not able to cope with the requirements of globalisation and international trade. On the other hand, there are a handful of international products that are not only expensive, but are also typically rigid and do not offer the business agility that SMBs in a dynamic economy like the Middle East require in order to stay ahead of the competition,” he observed.

Ali Hyder, CEO of Focus Softnet, said that the SMB business applications market in the Middle East region, has been growing and would continue to grow across various verticals. “A significant number of SMB companies are looking at lowering TCO by availing the shared cost model in the adoption of business applications,” he said

At Sage Software, Vikram Suri, managing director Middle East & India, said the market is getting more competitive, as customers now question why they need these tools and how relevant a solution is to their business. “Post recession people are still questioning investment in technology and trying to join the dots of that investment to their business benefits,” he said.

Before delving into the offerings available to customers, it is necessary to evaluate the health of the channel and what is happening. Training of course is important, but it is equally important to understand a customer’s needs and the ability to deliver an appropriate solution.

Hyder said that the channel is involved directly with many industry verticals and is in the position to understand customers’ requirements and identify gaps on how business applications will work for them. He belives channel partners have to identify the best business solutions that will fill this gap.

Doug Kennedy, VP, Microsoft Dynamics Partners, said channel partners need to focus on their core competencies and continue investing in marketing, pre-sales, sales, and delivery skills.

Remarking on Microsoft Dynamics’ training programme for partners, Kennedy said: “The learning plans will help the partner to focus on specific goals and access the training they need to gain in-depth product knowledge and obtain the relevant certifications.”

Juvara said Openbravo’s partner programme is very selective, and requires of all partners ‘to maintain a minimum number of certified professionals on staff.’

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