The Innovation Value Chain – An SME Perspective

July 2, 2012

Simon Hill, Big4.com, Guest Blogger

In a conversation with a client recently we found ourselves talking at length about what the proliferation of specialist, cloud-based applications has meant for small and medium sized businesses. They were a 50 person development shop, but the conversation spanned the SME spectrum. I reflected on that conversation that evening and felt it was worth encapsulating it in a post to share as the issues and challenges are certainly not unique to that one business:

The emergence of specialist, low-cost cloud solutions is both a blessing and a challenge:

The boom in web-based IT means that there are a host of specialist solutions available as apps, SaaS, on-demand and cross device. SMEs are now able to buy services that previously would have, even if they had been available, been far too expensive for them. They can now license access to tools for small amounts of operational expense and on monthly commitments, the benefits are unquestionable and without doubt these services make our business lives much easier.

But (we went on to discuss) there are challenges, I didn’t take notes at the time as we were just talking, but here are the things I remember us talking over:

Which tools should we be using, differentiating and selecting them is time consuming and complex?

Before we knew we couldn’t afford the time or cost to deploy most of these services. Now we can afford them and the time to deploy is minutes or less, but we don’t know which to choose and differentiating between service a, b or c is complex.

This is a really interesting dilemma, but I don’t think this really gets to the heart of the issue. Ultimately choosing the tools and services comes down to a few key criteria – are they fit for purpose, are they user friendly, is it secure and accessible cross-device etc etc. What we actually got on to was what I think is the really interesting challenge with specialist apps, they are all, primarily, stand-alone and don’t really work that well together. So let’s explore that a bit more….

Why can’t my apps and services integrate and work together?

The strategy for specialist applications has to be customer centric and has to therefore look to integrate within the value-chain (i.e. other applications along that value chain) if they are going to be successful in the longer term. The focus is therefore on two key areas – the API for pushing and pulling info between services, and the platforms from which to centralise these integrations. Integrations with leading product management tools (Basecamp, Pivotal Tracker, Huddle) are a good example. Using an idea software tool as an example: ideas come in, are evaluated and socialised amongst the organisational crowd, decision makers approve the best ideas and these are then passed along the value-chain to the next specialist tool for delivery of these ideas. The tool has done its job and the baton is passed. Now the SME has a suite of affordable and integrated specialist, best-of-breed services, who needs a big expensive enterprise deployment!

There is a lot of cross-over of functionality, do I need specialist tools or will one generalist one do?

How many applications and services can you cope with? This really depends on the complexity and maturity of the value-chain and processes you are talking about. The key challenge is not complexity, its ensuring people know what tools are for what purpose and understanding where they fit in terms of organisational process. Select the tools that work for your business, if that is one or many across a process, but as you scale the specialist tools do all you can to ensure they can sing and dance together. The last thing you want are multiple versions of documents, IP or any other key business in several disparate systems and try and centralise on one service per use case i.e. one idea management tool, one project management tool, one instant messaging service etc.

We didn’t solve all the problems, but it was a refreshing chat and shows where we are now along the maturity cycle for SaaS for SMEs and also I suspect larger companies as well.
Simon Hill is CEO and co-founder of Wazoku, an idea software company, an Associate Director with the Venture Capital Firm FindInvestGrow and an active member of the London technology and entrepreneurial community. Simon is an alumni of PWC, Deloitte and Cap Gemini.