At Cisco, SMBs are a top focus area, and the company has created a comprehensive portfolio that it believes will help it create a leadership position in a market that is growing exponentially, explains Shiva Kumar Y, Managing Director, Commercial & SMB India & SAARC, Cisco in an exclusive interview
Some edited excerpts:
What are some of the key challenges for Indian SMBs?
India’s small and medium businesses not only embraced digitization to facilitate business resilience during the pandemic but to establish a stronger presence in the market and become globally competitive. They were one of the fastest adopters of technology, and according to a NASSCOM report, they even have the potential to account for a third of the Indian public cloud market. This is a testament to the appetite and growth the sector has shown in the last few years.
But some of the challenges holding back the sector are a need for more technical skills, the sophistication of the threat landscape, and the budget availability. According to the Cisco India SMB Digital Maturity Study 2020, small businesses place cash flow at a level equal to sales performance and even higher than customer engagement, production, or supply chain. The main reasons are the lack of assets among SMBs. The second is in the credit risk assessment stage because small businesses need more financial data and credit history.
The second and one of the most significant challenges is the ever-evolving cyber threat landscape. A Cisco study reported that three in five SMBs in India had lost more than INR 3.5 crore due to cyberattacks in the last 15 months, with some reporting losses of up to as much as INR 7 crore. Since they usually operate with limited resources and smaller teams, simplicity is the key to successful security deployments. Nearly 97% of SMBs in India feel that they have too many technologies and need help to integrate them. They need technology that is easy to deploy, use, manage, and available in pay-as-you-go models. The key to bridging these gaps is collaborating with the right partners to enable enterprise-grade solutions for small businesses. Lastly is the need for a technically skilled workforce. The importance of skilled workers to understand, explore, and demonstrate the possibilities of technologies is extremely critical as we go deeper into the digital-first world.
How does Cisco plan to capitalize on the opportunities in the Indian SMB market? Please explain the size of the opportunity and your product positioning to ensure competitiveness?
The MSME sector is one of the greatest arsenals of India’s growth. According to the MSME Annual Report 2020-21, the sector contributes to nearly 33% of the GDP and employs over 130 million people. With over 75 million small businesses in the country, even if half started their digitization journey, they could add up to $216bn to India’s GDP by 2024. Partnerships between SMBs and large tech conglomerates can be mutually beneficial to ensure they can maximize their technology investments and succeed in their digitalization journeys. SMBs can better understand the rapidly changing market conditions and evolving technology landscape and enhance their customer outreach through such collaborations.
At Cisco, SMBs are a top focus area, and we are committed and well-positioned to help them navigate any disruptions. As they fast-track their digital transformation brace the evolving hybrid world, we continuously innovate to help them digitize and capitalize on the opportunities created by the country’s accelerated digitization. We have been focused on creating purpose-built solutions and developing Cisco Designed. Built around four fundamental tenets — connect, collaborate, compute, and secure — the Cisco Designed portfolio provides a range of digital solutions that enables SMBs to connect to the digital network securely, collaborate seamlessly, and leverage data center solutions. It allows SMBs to operate without dedicated IT personnel, as they can get assistance from the partners trained by Cisco to handle any technology-related challenges.
We have also introduced a financing program for Indian SMBs to purchase Cisco products at zero interest with no upfront costs. This offer extends to the entire Cisco SMB portfolio, including software, hardware, and services. Today, around 25,000 SMBs are using Cisco tech to future-proof themselves, and our aim is to digitize over 1.5 million small businesses.
What kind of growth has Cisco witnessed in the Indian SMB segment? What are some of the hottest-selling products, and why?
For Cisco, Commercial and SMBs constitute almost 50% of business in India and are one of the fastest-growing segments. We truly believe this is just the start, as many more SMBs realize that digitally disrupting themselves is the key to winning in the hybrid world.
At Cisco, we offer a range of innovative and intelligent solutions that are easy to deploy, manage, and scale. Our products have been designed keeping in mind the technology trends – increasing shift to cloud-based solutions, reimagined hybrid work models, customer experience, 5G-enabled emerging technologies, and pay-as-you-go models.
Some of those products are Cisco Meraki, a cloud-managed IT solution that allows businesses to strengthen their high-density network quickly and easily, and it can be monitored using a centralized dashboard. Second is Cisco’s Secure Collaboration Solutions which help create a secure network to enable seamless hybrid work, and this includes Webex, video devices, collaboration platform-as-a-service solutions, etc. Third, the Cisco Small Business Security Solutions help deliver on the Cisco Predictive Networks vision, starting with SD-WAN, Cloud Security, End-point Security, and Network Security. Lastly, we also have data center networking and hyper-convergence solutions.
Future roadmap in the next year
SMBs now have a heightened awareness of their need to modernize IT. While organizations often pursued various degrees of digital transformation before the pandemic, the new perspectives we’ve all gained on how and where work gets done have refocused those efforts. Primary drivers of digital transformation used to be business growth and customer intimacy; now, it’s operational efficiency and connectivity between employees, customers, and partners.
According to the World Bank, globally, SMBs represent about 90% of businesses and more than 50% of employment worldwide. Therefore, to help the sector make the most of the digital-first world, policies must be designed and executed to ensure business continuity and growth. In line with this, at Cisco, we continue to develop and innovate solutions that are sustainable and directed explicitly toward small businesses to help reduce complexities and costs while ensuring operational efficiency and business resiliency.