Cloud, mobile and security top the list of technology trends in small business again for the coming year. But this is no business-as-usual report; these trends come with refined twists that pack a wallop. In other words, it’s not just about using cloud and mobile; it’s about data convergence and reimagined work. And while security earns intensified focus this year, it also comes with new mandates from some of your biggest customers.
Here’s what you need to know about cloud computing, mobile and security to stay on top of new business demands and opportunities in 2015.
1. Small Business Trends in Cloud Computing
It’s no secret that small businesses are flocking to the cloud. Indeed, 92 percent of small businesses use at least one cloud business solution, according to SMB Group analyst Laurie McCabe’s blog post.
The most common use of the cloud thus far is subscription software. Increasingly, small businesses subscribe to software rather than purchasing it outright and installing it on company computers. Subscription software, otherwise known as Software-as-a-Service or SaaS, not only reduces the cash outlay for software, but it also lets you and your employees remotely access the data from home office desktop computers, laptops, tablets, and smartphones.
While small businesses pay more over the life of the subscription than they would if they purchased the software outright, the monthly “rental” model is easier on cash flow, includes automatic software updates, and places the onus of IT maintenance on the vendor rather than the small business owner. The “use anywhere on any device” flexibility also untethers SMB owners and workers from their desks, which increases both productivity levels and workflow options.
But that’s just the beginning.
Subscription software whetted the SMB appetite for more remote access to the company data. This year will see more SMBs moving data to the cloud precisely for that purpose. Both plentiful and cheap, cloud storage makes adding hardware to the company data center an unpalatable choice in most cases. Although some companies use a hybrid approach—wherein some data resides in the cloud and other data in the companies’ on-premises servers—primarily as an additional security measure.
Small businesses are also turning to the cloud for infrastructure services. “Eighty-seven percent use at least one cloud infrastructure solution,” says McCabe in her post.
“In 2015, cloud solutions are poised for hockey stick growth as more SMB decision-makers turn to a cloud-first approach that not only supports existing business models, but also enables them to develop innovative new products, services and business models.”
All of these changes will result in the restructuring and repurposing of small business IT staff. According to McCabe, this is the year that “SMB IT staff and channel partners evolve into cloud managers.”
In a statement to the press Steve King, of Emergent Research and co-author of a joint Intuit report, Small Business Success in the Cloud, said:
“Today, the U.S. and global economy is going through a series of shifts and changes that are reshaping the economic landscape. In this new landscape, many people are using the power of the cloud to re-imagine the idea of small business and create new, innovative models that work for their needs.”
How the Cloud has Redefined Small Business
But the cloud isn’t just making work easier and more productive; it’s changing how small businesses attack business opportunities and threats too. According to an Intuit study, small businesses that find great success in the cloud fall in four broad categories:
Small businesses will increasingly adapt to the cloud by taking advantage of specialized services that they can seamlessly integrate into back-office operations. Instead of spending time and effort on the nuts-and-bolts of finance, marketing and human resources, cloud-adapted small businesses will plug into cloud-based providers who deliver comprehensive, tailored solutions, giving small business operators the ability to focus on mission-critical areas of business.
Cloud-adapted small businesses will increasingly be made up of individuals who share talent to form a team. These businesses will operate virtually, with employees working in different locations, and increasingly flexible staffing levels will rise and fall to meet project needs. For example, independent contractors will use virtual spaces to connect and market themselves. On Main Street, small manufacturers and producers may share a commercial facility.
A growing number of cloud-adapted small businesses will compete head-to-head with major firms, using the growing number of platforms and plug-in services to reach markets once only accessible to large corporations. This is already happening with platforms such as AirBnB, which provide individuals with the ability to reach a mass market through community infrastructure.
Successful cloud-adapted freelancers will bring together multiple income streams to create a career portfolio. These largely will be people who start with a passion, or a specific skill. They’re motivated primarily by the desire to live and work according to their values, passions, and convictions. They will increasingly build personal empires in the cloud, finding previously unseen opportunities for revenue generation.
2. The Convergence of Mobile, Cloud and Data
Small business data is on the move—thanks to the cloud—and mobile devices provide far more than a standard means of communication. Two prime trends breaking on this front: mobile payments and using geo-location in mobile advertising and marketing.
“We’re seeing the use of geo-location—meaning pushing out ads to people within a given radius of a business,” says Ken Wisnefski, founder and CEO of internet marketer, WebiMax. “It used to be a difficult prospect to incorporate people’s vicinity to your business into your Internet marketing and advertising campaigns. But social media makes this simple and cheap, for example using Facebook’s Local Awareness Ad product, you can create ad campaigns for as little as $5 a day.”
In short, mobile isn’t just about getting your work done; it’s about attracting customers to your business in myriad ways, too.
Mobile payments are on the upswing too, in ways that go beyond the usual services such as Swipe, Square, Dwolla, and PayPass. New services, such as Apple Pay, require that small businesses have a POS system that supports the NFC chip. It will be awhile before the mobile payment services industry goes through a shakeout that will shorten the list of options an SMB must accommodate. For now, Current trends in mobile payment options mean that accepting mobile payments in almost any form is essential.
Bring-your-own-device (BYOD) programs are on the rise in small businesses, too. But these days, small businesses want to store company data in the cloud rather than on mobile devices to increase data protection should devices be lost, stolen or broken. It’s also easier to block a former employee from accessing company data that way.
“A growing majority of small businesses now regard mobile solutions as essential business enablers, with 60 percent saying that mobile solutions are critical to their business,” says McCabe. “Eighty-six percent of SMBs agree or strongly agree that mobile apps are a complement to traditional business applications, and 71 percent believe that mobile apps will replace some traditional solutions entirely.”
As mobile and data converge, rather than operate as two independent tools, they become more central to how business is done. And this, of course, requires renewed attention to security.
3. Security: A Top Priority, But SMBs Lag Behind
While small businesses notoriously assume that they’re too small to attract cybercriminals, the opposite is true. Hackers often view SMBs as the best entry points to a larger organization. That was the case in the infamous Target breach, where hackers gained access to Target’s data via an unprotected small company’s access to Target’s vendor portal.
But access to big companies is not the only appeal in attacking smaller companies.
“The cost of entry into an organization for a cybercriminal is decreasing and commercialization of malware and advanced persistent threats (APT) in particular grow at a rapid pace,” says Mark Bermingham, director of global B2B marketing at Kaspersky Lab. “As a result, small businesses will see attacks from a wider range of sources.”
“However, small businesses today are not very aware of this trend and are extremely vulnerable to an attack,” he added. “Small businesses need to be aware that cybercriminals, especially as malware actors become more prevalent, will follow the path of least resistance. In addition, the concept of the cyber-mercenary is very real today. As a result, we expect to see larger operations and more surgical strikes against small businesses.”
Because of this cybercriminal shift in focus, SMBs can expect their customers, particularly customers that are big companies, to insist that they meet security standards. SMBs that cannot prove they have adequate and reliable security measures in place will lose business in droves this year.
That’s the year ahead. Are you prepared for it?
Pam Baker has written for numerous leading publications including, Institutional Investor magazine, CIO.com, NetworkWorld, ComputerWorld, IT World, Linux World, Internet News, E-Commerce Times, LinuxInsider, CIO Today Magazine, NPTech News (nonprofits), MedTech Journal, I Six Sigma magazine, Computer Sweden, the NY Times, and Knight-Ridder/McClatchy newspapers.
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