There is a divergence of views on the definition of an SME. However, there is a unanimity on the fact a humongous growth potential for the SMEs exists in the country
Cover Story SME - Heart And Soul of Indian Economy
1. COVER STORY
There is a divergence of views on the definition of an SME. However, there is a unanimity
on the fact a humongous growth potential for the SMEs exists in the country.
G one are the days when most SMEs
had only a limited budget for capital
IT purchases. Today, the market potential is
and will also be key in developing India’s semi-
urban and rural areas thereby expanding the
domestic market”
unbelievably high. In fact, small- and medium- "The IT needs of both SME and large
sized businesses (SMEs) are a segment that
worldwide spends an estimated US$234 billion
The potential of SME enterprise are similar. While SMEs in developed
pats of the world are more oragnised, in India
(about Rs.10.53 lakh crore) per year on IT
products.
sector in India is really the segment is still conservative to an extent so
far as investment in technology is concerned.
As elsewhere in the big economies, Small and huge as it plays a vital role However, realisation is now downing on SMEs
medium-sized enterprises (SMEs) play a major in India that IT spend is something of an
role in the Indian economy. The SME segment for the growth of Indian absolute must," says Ravinder Raina, Country
has come to the forefront in the last few years Head - Private Network Solutions, NEC India.
in India due to several reasons; government economy by contributing HP foresees a humongous growth potential
thrust towards the segment, increasing business for the SMEs in the country. “Today, SMEs are
opportunities in a robust economy, domestic 45% of the industrial the backbone of the Indian economy. They are
demand, opportunities through globalization,
rise of tier-2 and 3 cities and towns and
output, 40% of exports, essential to sustain a competitive and efficient
market. In developing countries like India, their
momentum in entrepreneurial ventures.
“The SME sector in India is growing at an
42 million in employment, role is all the more critical, as apart from aiding
the growth of the economy, they also help
exceptional rate and this growth is invariably create one million jobs reduce the poverty,” says Nitin Hiranandani,
contributing to the overall economic growth Director - Laserjet Enterprise Solutions,
of the country,” says Ram Prasad, Deputy every year and produces Imaging & Printing Group, HP.
GM - Consumer Product, Epson India. Sriram Niraj Kaushik, Senior Director, Alliances
Rajan, VP - South, IBM India/South Asia, says, more than 8000 quality & Channels, Oracle India, airs his opinion on
“Small and Medium Businesses (SMBs, or Small the definition of an SME. He says, “Typically a
Medium Enterprises, variations of the same products for the Indian very large organization will typically have more
concept) have long been the engines driving the
economic growth of the country. As the global
and international markets. complexity but even smaller organizations also
will have different degrees of complexities.” To
economy continues its steady recovery, it is this Oracle level of complexity determines whether
group of entrepreneurial companies that are the enterprise is SME or not.
best-positioned for success.” Dell has kept its definition of SMBs very
VP Sajeevan, Director – Consumer System simple. Organizations having employee strength
Products Division, Canon India, says, “They are of 100 or less are called small businesses, more
a major link to the supply chain to Corporates than 100 but less than 500 are called medium
Ram Prasad Sriram Rajan VP Sajeevan
Deputy General Manager - Vice President - South, Director – Consumer System
Consumer Product, Epson India IBM India/South Asia Products Division, Canon India
44 October 2011 www.varindia.com
2. COVER STORY
businesses & 500 employees & more are large launched under EDGE series and part of the
enterprises. robust and realiable Think brand. The range
Anand. S, CEO, Zicom Electronics Security of products include ThinkCentre Edge 91z,
Systems Ltd, says, “It’s a known fact that India ThinkCentre Edge 71z, ThinkCentre Edge 71,
has the 2nd largest SMB segment amongst ThinkPad Edge E420s(SSD), ThinkPad Edge
the peer nation groups of BRIC, with over E420, ThinkPad Edge E420s (HDD). We are
35million SMB and MSME establishments. on a continuous surge to innovate as per the
By 2015, this is projected to grow to 45million changing trends of the market.”
establishments. Amongst the various SMB “With increasing entrepreneurial desire and
verticals, Professional Services and Retail have inflow of investment, we are going to witness
a very high technology adoption rate.” the unleashing of huge inherent power of SMEs
Nitin Hiranandani in our country in time to come,” says Hemendu
SMEs: Opportunity Galore for Director - Laserjet Enterprise Solutions, Sinha, Business Head, B2B, LG India.
vendors Imaging & Printing Group, HP Rajiv Sodhi, Director - SMB, Microsoft
For Cisco, SME is one of the fastest India, says, “SME constitute the chunk of
growing verticals. Arun Dharmalingam, VP, businesses in India and Microsoft is geared
Cisco India & SAARC says, “We at Cisco
believe that the business needs of an SME/B SME’s up to meet the requirement of most of these
SME’s. Microsoft provides the basic product
remain quite similar to that of big organizations and the platform for partners to be able to
– smaller enterprises want a good and reliable
network that will help them conduct their
Contribution provide customized solutions to a diverse set
of verticals.”
business efficiently, a secure place to store their
information and easy to use collaboration tools towards GDP in Indian SMEs are playing dual role of
preferred supplier and largest customer pool
that could help them connect all the employees for IT sector. The rapid growth of ITES, IT-
together.”
“A large number of companies in the IT
2011 was 17% software and IT-hardware sectors have provided
platform for many IT start-ups. “Lower
sector are from an SME background. They
are poised for a huge growth rate in providing which is expected investment, cheaper skilled labour, financial aid
provided by the government and other financial
software and hardware products and services. institutions are major driving forces for the
Most of these companies offer IT services as
well as software products. Custom application
to increase to growth of SMEs in these sectors,” says Vinit
Mahulkar, National Sales Manager- VoIP- IT/
development and IT consulting are the two
software services which are seeing huge 22% by 2012. Networking Segment, Matrix Comsec Pvt. Ltd.
The Small and Medium Enterprise segment
demand from network security solutions,” says in India shows great promise and scope for
Hemal Patel, CEO, Elitecore (Pprovider of growth. As the SMEs grow their business so
Cyberoam). does their need for infrastructure and peripherals
Dell sees tremendous opportunity in to set up a smooth running office. SMEs look
the SMB segment and believes it knows this for cost effective products that are also super
segment better than anyone else. “As one of efficient. Canon CSP (Consumer Systems
our top five global business priorities, we are Products) division offer a host of products like
committed to addressing the pain points of laser printers, inkjet printers etc that offer high
the small and medium businesses and have a end printing solutions to SMEs. One such
range of SMB specific products and solutions,” example is the laser printer Canon LBP3300,
says Satyen Vyas, Director, Medium Business, specifically designed for high volume printing
CSMB, Dell India. to meet workload demands. The MF 4450
Rajiv Rao, Director SMB-Lenovo India says, on the other hand is a cost- effective printing
“As a company, our main focus is to understand solution – Multi function Laser Printer- that has
our customers. We lay special emphasis to cater a huge potential in semi-urban and rural areas
to specific needs of the target segment, allowing of India. Another innovation for SME is wi-fi
us to be their preferred partner. Keeping this in Niraj Kaushik Laser MFD 4420 W – This will enable the user
mind, we have recently introduced an exclusive Senior Director, Alliances & to print from anywhere in the office.
product range for SMBs with attractive features Channels, Oracle India Cisco offers a spectrum of SMB specific
and competitive pricing. All the products are solutions that have been built with their unique
Anand. S Arun Dharmalingam Hemal Patel
CEO, Zicom Electronics VP, Cisco India & SAARC CEO, Elitecore (provider of cyberoam)
Security Systems Ltd
www.varindia.com October 2011 45
3. COVER STORY
requirements in mind. “The technologies that technology because of its ability to cut costs
are covered within our SMB-class solutions run and reduce the need for capital equipment -
the gamut from offerings such as switching and both hardware and software.
routing that help organizations connect disparate “While IT budgets across verticals continue
branches, security tools to protect the network to increase, Cloud computing is expected to
against rogue attacks and downtime, datacenter/ reshape the Indian IT market by generating new
storage solutions for storing an organization’s opportunities for the IT vendors and driving
prized intellectual capital, telepresence units changes in traditional IT offerings. The rapidly
that provide a medium to conduct meetings via growing enterprises, vast base of SMBs and
video technology, collaboration tools helping government adoption are driving the growth
employees stay connected with each other, of this sector,” says Amit Mehta, Director –
digital media systems for retail to virtualization Satyen Vyas Marketing, EMC India & SAARC. According
technology facilitating the adoption of cloud Director, Medium Business, to Sundara Raman, Chief Architect - Ramco
computing by SMBs,” says Arun Dharmalingam CSMB, Dell India OnDemand ERP, “Our message to the SME
of Cisco. market highlights the benefits that a customer
“We realize that SME’s are in need of can reap by moving to the Cloud.”
products and solutions that exceed their Rajiv Sodhi of Microsoft says, “Microsoft
customer expectations and Epson products
serve the purpose in this regard,” says Ram
Prasad of Epson. Anshul Gupta, COO, Go IP
SMBs account has one of the most comprehensive portfolios
of products to meet the specific requirements
of the SME sector. We are uniquely present
Global Services Pvt. Ltd says, “We realize that
there is a need to ensure that the IT is made
for $257B of the as leaders in the productivity and cloud space
to offer a compelling proposition to the SME
simple for the SME to understand and consume.
It has to be often a TCO model for the SME
leadership rather than ROI model. Our effort is
IT opportunity sector.”
Symantec provides solutions for security,
data protection, availability, and storage
to make IT to be consumed on demand so that
there do not have to be upfront commitment
in 2011, which management for the highly virtualized and
scalable environments required for cloud
on IT but on a pay per use model.”
Bhaskar Joshi, Manager- Marketing, Office
Imaging Solution Division, canon India says,
is 59% of the computing. “Symantec’s solutions for the SMB
market incorporate the features that a SMB
user can implement with ease, yet integrating
“As SME are continuously looking for cost
effective hardware and Software solution to
total market. elements of enterprise level technology,” says
Ajay Goel, MD – India & SAARC, Symantec.
develop robust IT Infrastructure and Canon Anshul Gupta of Go IP echoes the view that
entry level offerings in Hardware and Software cloud is the next step for SMEs. He says “Our
Domain is supporting these SME in their service focus remains bringing quality Remote
Pursuit of Advance Print Management and Infrastructure managed services to the SMB/
Workflow Management Infrastructure.” SME segment at an affordable cost, with the
same delivery quality of an enterprise segment.
Vendors Cloud Computing: The Next As the new initiative we are working on coming
Big Wave in SME Market up with cloud services for this segment.”
Small to medium sized enterprises (SMEs) Philips has a wide range of products to
are the primary market for several channel cater to almost all the sectors and has specific
partners. Even for an industry prone to hype, monitors to target the SME/SMB sectors. “We
the buzz surrounding cloud computing is sky- have monitor range from 18” to 27” LED. The
high. There is no doubt that few sectors have PowerSensor range from Philips is in-built with
generated more interest than cloud computing. PowerSensor technology which features a built
Cloud computing promises to be providing in people’s sensor. Harmless infrared signals
cost-cutting offerings that are strongly appealing detect the presence of a person in front of
to SMEs. After all the more popular cloud the monitor - and automatically reduce energy
computing gets, the less hardware SMEs will Rajiv Rao consumption by up to 80% the minute they
need to buy. Director SMB-Lenovo India walk away,” says Gautam Ghosh, Country
A growing number of SMEs in India are Director- India, MMD. Thus, controlling the
getting to grips with the cloud computing power consumption of the monitor and not
Hemendu Sinha Rajiv Sodhi Vinit Mahulkar
Business Head, B2B, LG India Director - SMB, Microsoft India National Sales Manager-
VoIP- IT/Networking Segment
Matrix Comsec Pvt. Ltd.
46 October 2011 www.varindia.com
4. COVER STORY
compromising with the superior quality that Coimbatore, Goa, Kochi, Lucknow, Vadodara,
Philips has to offer. Other than this, Philips Vizag, Nepal and Bhutan,” says Surajit Sen,
has a range of monitors which are easy on your Director Channels Marketing & Alliances,
pockets and yet are brilliant performers.” NetApp India.
In terms of storage, SMEs require holistic
Storage for SMBs storage solutions that work well in networked
In India also, SMBs are heading towards environments, have built-in backup capabilities,
a data deluge and given the requirements of and simplified remote access capabilities. These
effective storage, management and retrieval of attributes are necessary to realize the benefits
data storage has assumed the role of a critical of lower costs and increased administrator
IT enabler in today's time. As per IDC, the efficiency.
Enterprise Storage market in India is expected Anshul Gupta “WD is banking on the diversifying SME
to witness a double-digit growth. A significant COO, Go IP Global Services Pvt. Ltd. market for storage products. We are able to
portion of this growth would be contributed by focus equally well on all verticals courtesy
organizations (especially SMB enterprises) in our extensive distribution set-up,” says Sushil
cities other than the top four metros. Bandi, Country Manager for the Indian Sub-
At about $35 billion, the size of the storage continent, Western Digital. He adds, “We
hardware and services market for solution also have specialist distributors that have an
India is home to
providers serving clients in the SMB space is expertise in consulting smaller businesses on
mind-boggling. And, there are just as many the right storage solutions for their IT systems.
vendors with storage solutions as there are This current set-up is working quite well for us,
potential clients ready to snap them up.
The easy deployment and affordable
the second largest especially as we gear up to enhance focus on the
immense potential of the AV drive segment.”
SMB base in the
availability of technology solutions are key
drivers for the SME fraternity to adopt better ERP Solutions Right for SMEs
technology. The business challenges in the SME Today's small businesses are increasingly
Market are not new, and their transformations
are putting pressure on IT resources to change
world with 35 using technology for business advantage and
competitiveness. It was not so in the distant
million companies
with them. “Today, with simple to understand past that ERP was considered an expensive
GUI based management, storage has become proposition. However, things are changing
easy to deploy, manage, protect and is fast. Sundara Raman of Ramco OnDemand
expandable to the future needs. Most customers ERP; says, “SMEs can benefit from the winning
based on their experience are looking to partner combination of OnDemand technology and
with vendors who are ready to take the role of a business expertise from a pioneer in Cloud
true partner and help customers in adopting the ERP market, and get assured of zero or lower
right technologies,” says Amit Mehta of EMC. capital expenditure, faster implementation, ease
EMC has market specific storage bundles of adoption, and automatic upgrades.”
for SMB in India. These bundles are approved “Solution providers are quite excited at the
configuration and make it easy for customers prospect of growth of SMEs in the country.
and partners. With the ICT sector booming - ERP, CRM,
The storage giant NetApp defines SMBs as Broadband and Telecom, there is huge scope
organizations which spend more than $50,000 for modernizing Indian SME sectors with
per year on storage, or which have 250-1,000 IT solutions,” says Ankesh Kumar, Director
employees. Presently, the company is busy - Channel Products & Marketing, Emerson
in formulating strategies with an increased Network Power.
focus on Indian SMBs and will pitch its FAS SMEs and Security
2000 product line (at entry level) for the Today information security is a real issue.
SMB segment. “As an organization NetApp Like large enterprises, SMEs are also badly in
doesn’t differentiate between SMBs and SMEs. need of better security, and they are in the know
However, SMBs contribute 30% of NetApp’s Bhaskar Joshi of the importance security plays. For Indian
revenue, the company has decided to work Manager- Marketing, Office Imaging SMEs, security is a high-priority or critical-
with its distributors-Redington and Avnet to Solution Division, Canon India priority issue.
increase its focus in Ahmedabad, Chandigarh, Though SMEs cannot afford to have
Amit Mehta Ravinder Raina Sundara Raman
Director – Marketing, EMC Country Head - Private Network Chief Architect - Ramco
India & SAARC Solutions, NEC India OnDemand ERP
48 October 2011 www.varindia.com
5. COVER STORY
Gautam Ghosh Ajay Goel Sunil Kripalani
Country Director- India, MMD MD – India & SAARC, Symantec Vice-President Global Sales
& Marketing, eScan
dedicated resources to handle the security
of the network, they face the same level of
information security risks as enterprises. Hence, India is home to
they also need to implement high level of
Information security that can ensure Business
Continuity. It has become vital for SMEs to find
the second largest
new ways to perform their operations efficiently
and cost-effectively. “We, at eScan understand SMB base in the
the challenges faced by SME. Hence, we have
specially designed security products that have
enterprise level security to help SMEs deploy a
world with 35
strong security strategy built around the simple
but powerful architecture of endpoint security million companies
technology,” says Sunil Kripalani, VP Global
Sales & Marketing eScan.
Small and medium enterprises contribute Ankesh Kumar
to more than 30% of the total revenue of Director - Channel Products &
the overall IT security market. “Hence, the Marketing, Emerson Network Power
SME market opens a very wide window of
opportunity for McAfee and its partners to
increase their sales service revenues as well
as margins,” says Terence Gomes, Manager -
Inside Sales South Asia, McAfee.
Each day, SMEs have more and more critical
data that needs to be secured and with the
amount of information growth, their storage
needs are also on the increase. Despite the
criticality, SMEs continue to have low budgets
for their IT infrastructure.
“Our solutions across security, data medium businesses to be always connected and
protection are designed to address specific always protected. Our Worry-Free Business
challenges and made just for the SMB user,” Security Services is one initiative in that
says Ajay Goel of Symantec. direction,” says Amit Nath, Country Manager
Trend Micro has identified SMB as an India and SAARC, Trend Micro. n
important market segment. “We as security Terence Gomes
solution provider, promise a safer, smarter, S. Mohini Ratna / mohini@varindia.com Manager - Inside Sales
simpler security solution that allows small and Deepak Singh / edit@varindia.com South Asia, McAfee
Surajit Sen Sushil Bandi Amit Nath
Director Channels Marketing Country Manager for the Indian Country Manager India and
& Alliances, NetApp India Sub-continent, Western Digital SAARC, Trend Micro
50 October 2011 www.varindia.com