Small Business Financials.
Today, Microsoft launched its first new small-business product of 2005,
the first of many that competitors and partners should look for this
year. The product, Microsoft Small Business Financials, is designed for
the some of smallest SMBs, those with 10-49 employees.
The software comes out of Microsoft's Business Solutions division,
which focus had been more on what the company calls the mid-market,
larger SMBs below 1,000 employees. Competitors and partners should
watch for more Business Solutions downstream-moving technologies. Later
in the year, Microsoft plans to release Office for Small Business
Management, packing updated client-relationship management features and
adding an accounting component.
Microsoft's approach of releasing specific small-business products
is the right one. Too often, vendors make the mistake of trying to
reposition enterprise products for smaller businesses. Particularly for
the smallest shops, the approach is the wrong one.
Still, for all Microsoft is trying to do right, major shortcomings
could hamper the company's efforts. I believe Microsoft has made a
strategic error by selling Small Business Financials the way it does
other Business Solutions' products. Microsoft acquired most of the
products sold by the division. The acquisitions also came with highly
developed–and in some ways, stagy–sales channel structures. While
Microsoft has done a good job trying to integrate the disparate
channels into its own programs, Business Solutions products rely
heavily on third-parties to make the sales. So much that it's near
impossible to get pricing information without being contacted by a
third-party sales person. Pricing and other valuable information for
most products from the majority of other Microsoft divisions is easily
found on the company's Website.
Particularly for the smallest SMBs, JupiterResearch surveys show
that top-buying preferences are direct from the manufacturer and
through retail. Resellers rank fairly low on smaller SMBs' preferred
buying sources (See my report, “SMB Sales: How Competitors Can Trump Microsoft by Being Direct“).
Given this context, I think Microsoft should consider making the new
small-business software easier to buy. Simpler the better. … [Microsoft Monitor]