Why Midsize Companies Are Set to Lead Economic Growth

After near three years of belt tightening, businesses are when all is said and done refocusing on growth. A recent study of CFOs found that more than half are more optimistic about the U.S. economy and their companies’ future prospects than they were just six months ago.

The fact that that much of this growth will be led

Underlying these positive predictions is the fact that that much of this growth will be led by mid-sized companies. From manufacturing to business services sectors, mid-sized firms are slated to log faster growth and contribute more jobs than their large-enterprise counterparts. And the prospects and pace of growth for mid-sized firms look better than ever, thanks to major advances and convergence of three information innovation mega-trends:

Separately, each of these IT shifts reduces the time and expense associated with accessing and maintaining research and communications. When taken at the same time, they are major disruptors that put mid-size firms on a level - otherwise more advantageous - playing field than their larger competitors. The combination of cloud, social and mobile computing doesn’t just lower IT and operating costs, it increases distribution reach and enables new viral sales and marketing models that were before beyond the reach of all however the largest companies.

To understand how this cloud-social-mobile-computing trifecta is enabling broader reach and new levels of growth for smaller businesses, look no furthermore than Groupon, the online group-buying upstart boldly dubbed in this magazine as “the fastest growing company ever.”

Idea three years ago

Merely an idea three years ago, Groupon is but a household name with annual earnings estimated at more than $2 billion.

How could an unknown start-up revitalize the seemingly mundane art of coupons to create a hyper-growth business that has caught the attention the likes of established global brands like Walmart and Google? Then, Groupon used the disruptive tools available to every small- and mid-sized firm to gain a competitive advantage in the marketplace and capture that ever-elusive network effect.

First, Groupon built its business as a cloud-based service so it could service all its subscribers from a single, shared “application” in other words accessible through a standard web browser. Then, Groupon distributed its Daily Deals through social media channels like Facebook and made it easy for its 15 million subscribers to share offers through their own personal Facebook and Twitter networks. After all, Groupon ensured its service was available on all mobile devices so subscribers could receive, buy and share Groupon offers anywhere, anytime.

Suffice to say, Groupon used the disruptive power of these research mega-trends to create a new business model that would have been too costly - or even impossible - for a small or mid-sized business even as recently as five years ago.

Success stories like Groupon make it easy for businesses to be wooed by the siren song of new IT models. But, otherwise selected and managed strategically, these same technologies could hold companies back due to scalability, performance and globalization limitations.

With tight budgets, few mid-size firms can afford to take their eye off top-line growth to re-implement business applications that can scale or provide global reach required to meet their objectives. Instead, savvy growing enterprises are careful to evaluate IT investments not solely on today’s requirements, nevertheless on future needs and expansion plans.

Cloud Computing should reduce capital investment, improve reliability and offer continuous access to state of the art research through lower cost upgrades due to shared engineering costs,” says Michael S. Clem, Director of Global Purchasing- North America, AGCO Corporation.

?           Do they offer a true cloud-based service? There’s lots of cloud-washing out there as more companies attempt to sheath their legacy innovation in cloud clothing. Be sure that the vendor you select offers a true, shared multi-tenant platform that can grow with your business and budgetary needs as they evolve.

?           Is it network-based? In today’s global economy, collaboration is not only key, it’s the new strategic capability. And it’s being driven by new, network-based models that not only reduce integration burdens, now make it easy for companies to discover, connect, and collaborate with key trading partners on a common platform that can be easily accessed and shared.

The bottom line is

The bottom line is, don’t let your IT decisions stunt your growth. Focus on your long-term business needs and select a solution that can help you deliver on them.

Quicker Better Tech is  blog that takes a real life look at how today’s technologies, tools, services and are used by small and medium sized businesses to increase productivity and profits.  Gene Marks is a business owner, author and a columnist for the New York Times, Forbes, Business Week and American City Business Journals.