Business decision makers (BDMs) play a bigger role in cloud technology spending than IT managers, according to analyst firm Techaisle.
BDMs control the IT budget and purchasing with a ratio of 8:1 in small businesses, while in midmarket businesses, the ratio is much lower - 2:1, suggesting BDMs are more valued in smaller businesses compared to larger firms. Techaisle explained this makes it easier to sell cloud tech to small rather than larger businesses.
Techaisle's SMB & midmarket decision making & buyers journey report revealed BDMs have seven times as much influence in tech buying decisions within small businesses compared to IT management, although in midmarket businesses, this reduces to only twice as much power.
IT departments take authority for businesses with between 20 and 100 employees, while for those with more employees, BDMs are key to making the decision about what the company needs.
"'Determining the need for' a new cloud business application or a meaningful enhancement to an existing application is not, of course, identical to signing off on the purchase of a new system," pointed out Techaisle chief Anurag Agrawal.
Indeed, in cases where BDMs are in charge, the IT department's responsibilities shift to looking after existing systems rather than making strategic decisions, while the business management department becomes more responsible for driving revenues and will seek new ways to support business initiatives, which could include a more experimental attitude towards the cloud.
Business management has authority over the budget in the majority of businesses, whether the company has 20 employees, 100 employees or more. However, in 15% of organisations, no single party has the authority to decide how budget is spent.
Techaisle explained BDMs make decisions based upon the benefits to the business and objectives, rather than how flashy a particular technology appears to be.
"Once the applications are implemented IT gets involved and takes a proactive role in soliciting inputs for customization, enhancements and upgrades," Agrawal said.
"Due to an almost equal balance of authority between business and IT management, the decision-making unit becomes considerably larger than in small businesses making it imperative for IT suppliers to target both buyer segments - IT to prove technology capabilities and business to relate technology solutions to business issues."
