Low-Cost Money for Advanced IT

What will it take to get your business to take advantage of the cloud, business analytics, and other technology trends that have been sweeping the world?  Organizations everywhere are wrestling with how they are going to compete in the rapidly evolving cloud-centric, virtualized, data-driven business environment.

Tapping the cloud or ramping up business analytics, however, isn’t cheap. Industry experts promise that cloud computing, SaaS, virtualization, big data analytics, and other related technologies will save the organization money, drive efficiency, and help it make even more money. Sure, but getting started requires considerable money.

In September IBM announced that it will provide $1 billion in financing to help credit-qualified small and medium businesses (SMBs) over the next 18 months  take advantage of new advanced technologies, such as analytics and cloud. If money is slowing you down, this might help.

Financing, IBM notes, is one of the biggest challenges limiting the success of SMBs today. The  U.S. Small Business Administration (SBA) consistently reports that well over 50% of small businesses fail within their first five years due to lack of capital. Since this segment is responsible for nearly 65% of global GDP, representing more than 90% of all businesses and employing more than 90% of the world’s workforce, SMBs play a critical role in a global economic recovery. The current jobless recovery in part may be due to the financial constraints felt by SMBs.

With this announcement, IBM is trying to address the capital constraints while providing the right financial and technology resources to support SMBs in this economy. IBM’s commitment of $1 billion in financing for SMBs is intended to eliminate some of the cost barriers to deploying advanced technology. IBM will offer simple, flexible lease and loan packages, some starting at as low as 0% for 12 months with no money down, allowing them to immediately acquire the IBM technology and services they need to begin to transform their businesses, while managing their cash flow more effectively.

This isn’t altruism on IBM’s part. The company, which already commands a big share of the IT business of large companies, needs to penetrate the SMB market if it wants to continue to grow. It can afford to throw money around to seed what it considers will become a valuable currently untapped market.

IBM clearly expects to move its technology products as part of this initiative. In conjunction with the announcement the company is offering a set of workload optimized systems and services focused on the cloud, analytics, collaboration, and security–all specifically designed to address key SMB needs. Through this program technologies once reserved for larger enterprises with big budgets can become more accessible to SMBs. To tap this program you have to work through authorized IBM business partners. You can find such partners here.

The current poster child for this program is Russell’s Convenience, a company with 24 stores spread across Colorado, Hawaii and California. It turned to IBM’s collaboration cloud to enable more transparent communications between its far-flung stores for the purpose of conducting day-to-day sales, marketing activities, and meetings. Probably saved a lot of money just on travel too.

So, is this a good deal for your business?  It might be. As CIO, figure out what you need and talk with your CFO.

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