In just a few short months, we will be at a year since the pandemic hit this country — and to say it has had a profound impact on businesses is about as big an understatement as there is.

Much of the focus has been the upheaval in enterprise-class companies because they’re big organizations with lots of employees. Small and midsized businesses or SMB segment often gets ignored, I’ve found when talking with technology providers, but the reality is this segment makes up 49% of jobs in the private sector. Also, their technology needs are often the same as enterprises, just on a smaller scale, although the solutions do need to be simpler to manage since information technology organizations are often jacks of all trades.

To get a better understanding of the impact of the pandemic on this segment, Avaya Inc. recently conducted a “Work From Anywhere” study, released today. SMBs often lag behind large companies when it comes to technology adoption, but the survey found that wasn’t the case with COVID-19 response. SMBs have been proactively preparing for remote work in response to the pandemic, with most planning to make the technologies they’ve adopted a permanent addition to their tech stacks.

One surprising finding shows 83% of SMBs already had technologies in place to accommodate remote workers.  This is likely thanks to the strong adoption of software-as-a-service applications in this segment.  The study, conducted in August, is based on online responses from 300 tech decision-makers at U.S. companies with 50 to 500 employees.

With a work-from-home model in place, 58% of SMBs believe they’re now able to hire a more distributed workforce, while 49% feel they can hire a more diverse workforce. The respondents cited several other benefits of working remotely, including a rise in efficiencies (57%), customer satisfaction (53%) and employee satisfaction (48%).

Decision-makers are also rethinking every aspect of their business. For 80% of SMBs, the pandemic has affected how they approach customer experience. This is critical because how businesses treat customers is now the top brand differentiator.

Small businesses often get squeezed by companies such as Amazon.com Inc. but can differentiate through customer experience. Employee experience and enabling new ways of working is at the top of mind for 77% of companies. The study found 75% of the respondents are reexamining their sales approach, and a whopping 72% are revisiting their overall business model. 

I found this last number a shock, since my experiences with SMBs is that they often embrace the “If it ain’t broke, don’t fix it” axiom, because change can be hard and expensive. The survey clearly shows SMBs are now taking a step back from their rapid pandemic response and rethinking the future.

SMBs are adopting new technologies faster than planned, with 71% of tech decision-makers seeing increased adoption in their company since COVID-19. More specifically, SMBs are investing in collaboration tools to accommodate changing work requirements.

Not surprisingly, videoconferencing was the most frequently added tool, for 65% of the respondents — an indication that companies have become more focused on employee and team communication. Video is also being used as an interviewing tool to hire people, which falls in line with the previous data point of increasing hiring geography.

The study revealed more than half of SMBs have used free license offerings from tech vendors during the pandemic. Zoom was the most frequently used free collaboration tool, by 73% of companies, followed by Microsoft Teams (50%), Cisco Webex (29%) and Slack (24%).

The Microsoft data point is interesting because Teams isn’t exactly free but is included in some of the Office 365 bundle. The success Microsoft has had with a subpar tool compared with the competition shows SMBs like simplified purchasing, which Microsoft uses a differentiator, since it also isn’t the cheapest.

Going forward, 85% of SMBs plan to keep the collaboration tools they implemented permanently because of COVID-19, whether they were free or paid. That includes hardware companies implemented to assist remote workers, such as mobile phones (47%), cameras (43%) and landline phones (21%). I’m skeptical of this high number because when the free period is over, I do expect to see companies start to shop around again and either pick another free tool or switch to a cheaper one.

Most SMBs (71%) prefer to source collaboration tools through a single vendor, so they can have everything in one place. When all the tools are integrated, they are easier to manage and improve efficiency, according to companies surveyed in the study. That number is even higher (81%) for those with one office. Only 29% of the respondents prefer multiple vendors, mostly because they offer a better variety of products.

In actuality, 10% of SMBs use a single vendor for collaboration tools. More than half of the respondents (65%) use two or three collaboration vendors, and 22% use four to five vendors. Companies with several locations tend to use more vendors. For example, 40% of companies with six to 10 offices have more than four vendors.

Those data points may seem contradictory but, until recently there were very few vendors that offered all-in-one solutions. Recently RingCentral Inc. added video, Zoom Video Communications Inc. has introduced phone service, Cisco Systems Inc. has beefed up cloud calling and Avaya cut a partnership with RingCentral to address the needs of SMBs. With more choices, I expect customers to pick a single platform instead of paying for multiple ones.

Now that most companies have settled into the new normal, they are shifting IT priorities in several key areas. Security (61%), collaboration software (52%) and cloud computing (51%) are at the top of the list. This is the first survey I have seen that had collaboration ahead of cloud, which underscores the growing importance of conducting virtual meetings today. Midsized companies with 251 to 500 employees are seeing the biggest variation in priorities, as they increase spending for security (74%), collaboration (66%), contact center software (59%), and contact tracing (53%).

The pandemic also accelerated spending in areas where SMBs are typically slow adopters. Connecting to “internet of things” devices is a growing priority for 41% of SMBs, and artificial intelligence is a priority for 34%. Smaller companies are prioritizing investment in advanced technologies as they adapt to changes in remote work. I would not have expected to see IoT and AI as high, but the reality is both are core technologies that are changing businesses. Given that 72% are rethinking their business models, it’s good to see so many looking at advanced technologies.

The post-pandemic world will be starkly different from the one we left behind. SMBs could have been left in the dust, but the Avaya survey shows they’re making the decisions they need to make to keep up with the larger Joneses.

Zeus Kerravala is a principal analyst at ZK Research, a division of Kerravala Consulting. He wrote this article for SiliconANGLE.

Image: thedarknut/Pixabay