Investing in Emerging Technologies on a Small Budget

You don’t need a big IT budget to investigate or invest in emerging technologies. Nearly one in four mid-market companies are early adopters of new information technologies, according to our 2007 study of emerging technologies; 23 of the 30 technologies listed on the following page are being deployed, tested or explored by at least half of the more than 200 midsize companies we surveyed.

While Internet technologies and virtualization dominate the top 10, there’s also strong interest in search, service-oriented architecture, identity management and business process platforms and suites. While small and midsize companies are more likely to be early adopters than larger companies, we didn’t find evidence that they are more likely to see payoffs than larger early adopters. Like larger firms, mid-tier firms need a culture that supports innovation and processes that support effective technology implementation. Midsize companies should be especially careful about investing in emerging technologies they hope will reduce costs; nearly half say these investments haven’t fully met their expectations.

Finding 1:
The Web Tops Emerging Tech List for SMBs
Six of the top 10 emerging technologies are Web applications or Web application-enabling software
(Ajax, Flash). That’s a clear signal that the Internet remains the most important opportunity for SMBs. Still, some Web 2.0 technologies (mashups, virtual worlds, social networking) have been adopted by 6% or less of companies, too few to make the top 30 list. The top 10 technologies also include PC, storage, and application virtualization.

Finding 2:
Are SMBs Taking Advantage of Being Early?

Small companies are more likely to be early and mainstream adopters—but they aren’t more likely to receive significant payoffs. That’s a sign that smaller companies aren’t necessarily good at managing innovation, and that their cultures are not quite as receptive to using emerging technologies as they may think.

Finding 3:
Mid-Market Puts Premium on Process
SMBs don’t have the same priorities for emerging technologies as larger companies have. Mid-market firms place more emphasis on process improvement, productivity, and providing new products than larger companies, but not as much emphasis on cost cutting or security.

Web Exclusive Finding 4:
Searching for New Technologies Is a Conversation
Outside sources—publications, vendors, research firms, associations—are all helping SMBs spot promising new technologies. But CIOs shouldn’t overlook internal sources of information. Nothing is better than having a dedicated emerging technology department within IT, but internal blogs, wikis and networks of technology enthusiasts can also lend a helping hand.

August 2007 Mid-Market Research Slideshow: New Technologies To Grow On

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