SMBs' IT spends likely to grow: ACNielsen

With the small and medium businesses (SMBs) in India focusing on upgrading their IT infrastructure to have a competitive edge over their global rivals, the overall IT spends are likely to increase.

According to an ACNielsen study on 'Technology Roadmap of the SMBs', the main focus areas for Indian SMBs in the technology arena will be IT staff training and data protection and security.

While the SMBs operating in IT/ITeS sector (24 per cent of the total IT industry are SMBs) were likely to increase their IT budget in the next two years, SMBs operating in pharma sector (18 per cent of the total pharma industry are SMBs) would follow them closely.

The most common barriers to IT adoption, however, have been inadequate budget and a lack of alignment between business goals and IT efforts, the study added.

The total IT budget for about 54 per cent of the SMBs based out of Bangalore is within a range of Rs 50 lakh per year and close to Rs 1 crore for 16 per cent of the companies, it said.

The total spend of Indian SMBs on IT infrastructure was Rs 21,369.9 crore in 2005, ACNielsen study stated.

The study, which was conducted in association with the Computer Society of India (CSI), covered eight cities. The study polled SMBs across different sectors including manufacturing, transport & logistics, pharmaceuticals, hospitality and travel and IT-ITeS.

Said Sanjay Kumar Pal of Microsoft Dynamics, "The last couple of years have seen an honest desire by the SMBs in India to compete with large organisations with the adoption of technology. Technology solutions providers need to keep in mind that products have to be designed according to the needs of the SMBs and should be horizontally and vertically scalable."

Speaking at the ACNielsen seminar on 'SMB Revolution in India' here on Tuesday, Pal said that Microsoft Dynamics was a business management software provider that brings together people, processes and technologies.

Sanjay Singh, head, SMB Businesses, Avaya Global Connect said according to industry sources, the SME segment in India was growing at a CAGR of 20 per cent over the last few years and expected to continue to grow.

SMBs are migrating to the Internet Protocol (IP)-based telephony market which "is expected to account for more than 60 per cent share in the next three years," he added.