Kelvyn Taylor

Large IT vendors have a blind spot

Britain’s small firms are the backbone of the economy so why are vendors ignoring them?

Written by Kelvyn Taylor

With the latest round of buzzword bingo well under way on the back of Everything 2.0, this is probably a good time for me to have another little rant about big IT vendors and how they still seem to either not understand, or possibly not care about, the requirements of most UK businesses.

“The long tail” is one of the latest catchphrases that you’ll see plastered on PowerPoint slides and marketing material these days. It’s a term used to describe certain types of statistical distribution, where the combined volume of low-frequency items in the “tail” of the distribution add up to outweigh the high-frequency items at the chunky end of the graph.

The latest DTI statistics on UK businesses relate to 2004, and show a picture that has not changed substantially for many years. The total number of private businesses in the UK was estimated at 4.3 million, of which 99.3 percent were small businesses (0 to 49 employees), 0.6 percent (26,000) were medium (50 to 249 employees) and a measly 0.1 percent (6,000) counted as large (250+ employees). Even taking out one-man bands, there were still 1.2 million small companies.

Now that’s what I call an awfully long tail. And yet IT vendors still seem to wilfully ignore it: Alan Stevens recently wrote in IT Week about a large vendor that insisted “very few small firms have networks”, according to its research. So up to 99.3 percent of firms in the UK don’t have a network? Presumably it’s because they have no PCs either, if my colleague Alistair Dabb’s experience is anything to go by.

This brings me to the core of my argument. Several years ago I was helping one of these small firms, which had three employees, half-a dozen PCs (and a network) and an annual turnover of £4m. I was asked to find a couple of new PCs and a server, preferably from a “big brand” and I failed miserably. Nobody wanted to know: not the resellers, not the direct sellers, not the local computer dealers.

So I did what I suspect a lot of smaller businesses still do – I just upgraded the existing machines to get a few more months out of them. They were eventually replaced one by one with off-the-shelf boxes from a PC superstore.

I don’t know if this is still a typical situation, or whether enough suppliers have sprung up to meet the many and varied needs of smaller enterprises. But it seems that there’s not a lot of advice around to help fledgling firms – the Federation of Small Businesses’ latest (2006) report on Barriers to Growth doesn’t even include a section on IT procurement problems, except indirectly in a few pages about e-commerce.

The DTI’s Business Link web site has some gems of advice such as “hardware contains moving parts, and these will eventually fail”. Many small companies have the potential to be the large enterprises of tomorrow, so surely the backbone of our economy deserves better than this?

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