There is one area in which these tough times will be very efficient – sorting the businesses that will be set for success in the next boom. Make sure your’s is one of them. PAUL WALLBANK
By Paul Wallbank
As the downturn bites we’re starting to see big differences between the behaviour of established larger enterprises and that of smaller businesses and startups.
Over the Christmas break I’ve been doing quite a bit of reading, not of all it happy. One report was Goldman Sachs’ IT spending survey, which predicts a spending fall of 5% across the developed world.
This report confirms trends that are already noticeable here in Australia and we can expect this to accelerate during the year as the downturn bites.
One conclusion of Goldman’s is this will favour the large incumbent IT industry players such as Microsoft and Symantec while working against the newer technologies such as software-as-a-service (SAAS), web 2.0 and open source software.
As the big end of town focus on their core activities they will see experimenting with new methods and technologies as a distraction. It’s far safer to stick with what currently works even if it is just “good enough”.
For smaller and newer businesses SAAS, web 2.0 and open source offer flexibility and cost savings that are not only essential to survival but also allow them to exploit the niches and market opportunities that will develop over the next few years.
This difference between small and big businesses’ reactions to the downturn is going to be true right across the board. Apart from getting debt levels and unnecessary costs down, what works for big business will be very different to SMEs and start ups.
While the big incumbent players need to focus on their core markets, the smaller and newer operators have to be fast to spot opportunities, grab them and become the incumbent player in that niche before larger competitors even know that niche exists.
Some of today’s small businesses will the giants of the next economic boom, and many of the success stories will be because they embraced the new tools and technology available to them which allowed them to see and exploit the opportunities in the years ahead.
Paul Wallbank speaks and writes on how business owners can meet the challenges of the new economy. A business owner himself, Paul has spent over 15 years helping businesses achieve their potential. He has two computer advice websites; PC Rescue and IT Queries, and appears monthly on ABC Local Radio’s Nightlife program and Sydney 702 weekends.
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