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Why mid-market companies should get their Goldilocks mindset on

Mike Ettling Profile picture for user Mike Ettling November 17, 2020
Mid-market companies should apply a Goldilocks mindset to getting the best fit when selecting a business software supplier, writes Unit4 CEO Mike Ettling

Fashion designer taking measurement of man wearing suit in tailor shop © antoniodiaz - Shutterstock
(© antoniodiaz - Shutterstock)

Goldilocks got it right. Size is everything. It's true in all aspects of business — production capacity, office space, workforce size, amount of inventory — all these have to be 'not too big, not too small' if the business is to flourish.

Matching resource size to the volume of demand is second nature to those of us in IT management as well. We want to:

  • Pursue cloud so we can right-size our compute and storage resources.
  • Use software-defined networking so we can flex our connections and bandwidth.
  • Match spend to service usage through consumption-based pricing.

So, what about software? Doesn't software need to be 'right-size' too? Of course, it does. But it's not as simple as "small companies need small software packages; big companies need big ones".

It's more to do with the simplicity or complexity of the organization's operating model and business processes — and whether the software is an efficient way of achieving the required business outcomes.

Ill-fitting software holds mid-size firms back

Often, mid-sized companies either make do for too long with tools they've outgrown (like spreadsheets); or they're persuaded by vendors to use software that's too complex or ill-suited to their sector.

Medium-sized enterprises in any given sector shouldn't have to shoe-horn their particular business processes into a generic framework. They should be using software that's tailored to their industry.

Take a mid-size nonprofit organization, for example. One of their top business outcomes will be the ability to set up new projects and processes quickly. Another will be the ability to give donors impact reports in any format they require (and they all need different formats).

Making do with traditional enterprise software that was initially designed for the manufacturing sector, will make achieving these business outcomes very awkward. Any customization of this kind of software would have to be coded specially for them by their SI, which is likely to be time consuming and expensive.

What medium-sized enterprises need is software that's well-suited to their business requirements in the first place and that they can reconfigure easily themselves if they need to.

Companies need software that's 'just right'

Mid-size firms also need software that's cloud-based so their home workers can access it easily from anywhere and be sure of getting a good user experience. They should be able to scale the software up or down as their business volumes fluctuate and turn off features (and stop paying for them) when they don't need them.

At this stage in the pandemic, it's also essential that implementation and ongoing management can be carried out remotely.

Mid-size players will grow into big players one day, and in the meantime, they shouldn't have to make do with second best. Their software should give them access to all the juicy features, like AI, automation and natural language digital assistants, that accelerate productivity, innovation and growth.

The mid-market should also look to consume their software as a service, since this model offers lower upfront costs and bills that match usage. This way, firms can align costs to business volumes and smooth out cash flow.

Look for a good-fit supplier too

Finally, fit matters in the supplier. Mid-size firms should look for a software partner that's the same sort of size as them and has experienced similar challenges. This should put them on the same wavelength and help them form a constructive working relationship.

The supplier should know the client's industry inside out, which (in a mid-size supplier) may mean they don't cater for every sector, but specialize in a few and do them really well.

There should be a good cultural fit too. Clients should choose suppliers with similar values to their own. If you work in a people-centered sector, choose a vendor who puts people first and builds their software around the way people work in your industry.

Demand a focus on the soft factors that affect user adoption — a passion for user experience, for making work more straightforward and saving labor through automation. This will drive user adoption of digital services, maximizing engagement and fulfilling the promises of the business case.

In short, don't settle for software, or software vendors, that are 'too big' or 'too small' but find one that's 'just right' for your organization.

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