Gartner Analyst: Everyone Needs To Be On The Same Page When Defining A Midsize Enterprise

Mike Cisek, research director for midsize enterprises and IT operations at Gartner, told an audience of CIOs and IT administrators at this week's Midsize Enterprise Summit that success comes in part from forgetting everything they know and focusing squarely on the future.

The Midsize Enterprise Summit is hosted by CRN parent The Channel Company.

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IT executives in many if not most companies tend to stay focused on what he termed "past glories," or the things that previously worked well.

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"Try and forget everything you've known, everything that worked," Cisek said.

The problem, he added, is that much of the technology on which small and midsize enterprises depend was not defined for them because the vendors on which they rely do not understand their needs.

While Gartner defines a midsize business as a company with between $50 million and $1 billion in revenue, or between 100 and 1,000 employees, everybody has their own definition, Cisek said.

And that would be OK if the vendors understood the needs of a particular small and mdisize enterprise, he said. However, IT executives of those businesses would do well to ask vendors what they mean by midsize enterprises when they say they offer products or services to them, he said.

"What you're trying to do is get the products and goods you need according to scale," he said. "But what is the scale?"

In a survey this year Gartner asked CIOs to name their top business priorities for the next two years, Cisek said.

The top priority by a wide margin was growth and market share, followed by digital business and digital transformation, innovation and research and development, technology improvements, workforce focus, customer focus, business consolidation and security, he said.

Small and midsize enterprise IT executives must also learn to leverage five key technology trends, Cisek said.

The first is data curation, or making sure a business’ data is valuable and available now and into the future by taking advantage of prescriptive and predictive analytics, customer intelligence, knowledge management, and workforce and sales analysis , Cisek said.

"You want to make sure you can get your data to someone for whom it's high value," he said.

The second is operational innovation, which is the trend for which CIOs are most likely to be compensated, Cisek said. This might include investment in managing IoT services, machine learning, content services, customer self-service, cloud, rapid mobile app development tools, and IT service management tools, he said.

It is important for IT executives to easily share and exchange information on infrastructures and ideas, which require as little overhead as possible. "You don't want to add a lot of tactical debt," he said.

The third is risk-based security, where things like managed detection and response, browser isolation, managed security services, cloud access security brokers, and network sandboxing are becoming important, Cisek said.

Gartner found that 87 percent of small and midsize enterprises do not have a chief information security officer or any other dedicated security resource, he said. "That responsibility falls on midsize and small enterprise CIOs in most cases," he said.

The fourth, Cisek said, is requisite cloud services, including API management Platform as a Service, Content Services Platform as a Service, cloud-based IT services, cloud office, Integrated Information as a Service and Platform as a Service, Disaster Recovery as a Service, and Unified Communications as a Service.

IT budgets no longer have the luxury of adequate capital expense budgets and instead need the financial discipline to manage IT as an operating expense, Cisek said. "You have to figure out how to pay for it," he said.

The fifth is turning infrastructure into utilities, such as Firewall as a Service, operating system containers, micro data centers, hyper-converged infrastructure, SD-WAN, virtual machine backup and recovery, and again things like Disaster Recovery as a Service and Unified Communications as a Service, Cisek said.

Small and midsize enterprises have been moving away from component-based IT infrastructures for the past 10 years or so, and are adopting project-based infrastructures like hyper-converged infrastructure that allow quick expansion or even contraction as needed, he said.

This is especially important as vendors look to pull businesses into their clouds, but make it difficult to leave, he said. "You have to be aware of these before you commit," he said.

Cisek did a good job of defining the concept of a small and midsize enterprise, said Ben M. Johnson, CEO of Liberty Technology, a Griffin, Ga.-based solution provider who attended the Midsize Enterprise Summit.

"I've been talking with a lot of enterprise vendors as well as software companies and a lot of folks in the channel, and in every phone call that I've been on in the last year and a half I've made a concerted effort to make sure that I'm talking to who I think I'm talking to, and that they are talking to who they think they are talking to, and that the terms we are talking about like cloud, security and risk assessment mean the same thing to both of us," Johnson told CRN.

Johnson said his company's definition is very close to Cisek's definition, but unfortunately many vendors' definitions are not.

"It's the old ‘to a hammer salesman everything looks like a nail,’" he said. "They're trying to shoehorn enterprise solutions into the midmarket."

Johnson said that his business has gradually moved from a focus on small and midsize businesses to a focus on midsize enterprises.

"But lately, it's really been changing the consumption model and repackaging those so that we can actually sell them to the midmarket," he said. "Because with lots of folks, be it Microsoft with their enterprise agreements or Cisco with their enterprise licensing agreements, we're actually able to become aggregators for the larger enterprise vendors to take pieces of their enterprise solutions, put them together, and serve them up in a just-right manner for midsize enterprise clients."

Liberty Technology is going through many of the changes the midsize enterprise businesses at the conference are going through because it is designing, building and delivering the right solutions for them, Johnson said.

"We've had to, out of necessity, adopt a lot faster," he said. "But we've also gotten really, really good at it. And we've seen across a multitude of industries … what works and what doesn't based on employee count or size of the segment that they're in or the vertical that they're in or how high IT dependent they are."

Liberty Technology also has had to adapt to the breadth and depth of the IT capabilities and resources midsize enterprises have, Johnson said.

"That's been one of the largest differentiators, I think," he said. "A lot of enterprise vendors, they really don't focus on how IT savvy these customers are or on what ability to execute complex IT solutions they have."