Gartner's SMB Vendor Ratings: Hewlett-Packard

By Patricia Fusco | Posted February 02, 2004

Hewlett-Packard, IBM and Microsoft have been cited as three of the leading suppliers of technology for small- and medium- size businesses by information technology research firm Gartner. In its first ever vendor ratings of the most powerful global technology providers serving the small- to medium-sized business market, Gartner analyzes each vendors strengths and weaknesses.

Gartner used various criteria to rate the three key SMB vendors. The ratings are based on each vendor's corporate viability and SMB market offerings, as well as their customer service and support initiatives.

For the purpose of the ratings, Gartner defines small businesses as those with fewer than 99 employees and medium-sized businesses as those with 100 to 999 employees. Mika Yamamoto Krammer, Gartner research vice president, said HP, IBM and Microsoft were selected for the inaugural edition of its SMB vendor ratings because the three companies provide unparalleled products and services to the SMB market.

"Overall HP and Microsoft are the best suited to serve both small businesses and midsize companies. Businesses with fewer than 500 employees need simplicity and have smaller IT budgets," Krammer said. "We found that IBM best serves the mid-market, those businesses with more than 500 employees."

Krammer said the SMB vendor ratings are important for end users — small- and medium-sized businesses in the process of choosing their hardware and software vendors. Just how important? That depends on the product or service, the company behind it, and to a great extent, the U.S. economy.

"Our advice for the end user is to put into question the vendors they do business with," Krammer said. "Every IT vendor says it has some kind of product or service for the mid-market, but you've got to look at each vendor's track record individually."

Krammer advises that if the product or service is new, SMBs should wait to see if the technology picks up traction in market. The key question is this — when the economy picks up will serving the SMB market still be important to these vendors?

"Large enterprise space is so saturated, yet the mid-market is under penetrated. This is a scary proposition for small- or mid-sized business," Krammer said. "When the economy recovers we're going to see a mass exodus of IT vendors from the SMB market — 70 to 80 percent of the venders serving the SMB market today won't be there tomorrow. As the IT market consolidates and enterprises start spending again, SMBs need to know they've picked a brand they can trust."

Smart Office, Smart Decision
Trust is one of the reasons HP tops the list of SMB vendors. HP announced its invigorated SMB strategy in Sept. 2003. Gartner contends that HP's "Smart Office" products and services are well positioned and as a result, will experience significant growth in the SMB market.

The Gartner rating cites HP's entire product line and supporting organization as "strongly positive" or "promising." Chris Ogburn, HP SMB America team director, said the rating affirms the company's expanding presence of products and solutions for the SMB market.

"We think its validation of the work, effort and resources we've put behind serving the SMB market. Our Smart Office initiative extends to many different types of products. It's based on our ability to provide IT expertise for the SMB market," Ogburn said. " Our Smart Office offerings include imaging, storage and PCs that work well together. We make office technologies easy to own. Our research and development dollars are used to deign almost plug-and-play ease of use for SMBs."

Since HP launched its Smart Office initiative, more than 100 products and solutions have been released ǿ each designed to meet the specific needs of its SMB customers. Ogburn said these innovative products are only part of the equation for small- and medium-size business owners.

"SMBs want to have access to the HP's IT through local solutions providers that they can rely on, Ogburn said. "The right expertise, easy to buy, and easy to use — that's what Smart Office is all about."

But the SMB market in the U.S. is pretty fragmented — some 7.7 million SMBs in the U.S. alone — and different businesses buy through different routes.

"The mid-market predominantly buys through our channel partners, which positions us well," Ogburn said. "But we have strong direct-buying capabilities, too. So our brand is equally appealing to small businesses with less than 50 employees that tend to buy through retail outlets."

The SMB market is a very competitive space — SMBs demand good quality products at competitive prices. Ogburn said small businesses should be just as demanding as the mid-market when it comes to seeking out alternative hardware and software solutions.

"Depending on the dynamics of the business of your business, buying new hardware should make your business more competitive and consequently more successful," Ogburn said. "The smaller the business; the greater the potential return on each and every dollar spent on an IT investment."

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