The SMB Cloud Adoption Trend has a Silver Lining for MSPs

SMBs embraced cloud solutions to stay afloat during the pandemic, and now they need MSPs’ expertise to optimize, expand and protect these solutions and services.

Over the past year, as a global pandemic forced businesses of all sizes to adjust to remote work scenarios and economic upheaval, small and medium-sized businesses (SMBs) increased their use of cloud-based technologies. As we move into 2021, MSPs should take this opportunity to help them leverage the cloud in ways that can enable them succeed and thrive.

According to a new SMB Group report, Top 10 SMB Technology Trends, embracing new technologies and business processes will be critical for these smaller companies, many of which were pushed to the brink during the business disruption in 2020. According to the report:

“Technology will play a crucial role in helping SMBs gain the flexibility and agility they need to adapt and position their businesses as 2021 unfolds. Whether in the workforce or the workplace, in sales or financial management, in customer service or security, SMBs must tap into key technology trends that can help them make the necessary pivots to adapt, stabilize and grow back stronger despite the ongoing uncertainty.”

Many SMBs reported that post-pandemic business might look very different. While 22 percent of respondents said they expected demand for traditional products to return, nearly a third (28 percent) said they are making business model changes and creating new offerings. In comparison, 16 percent said they had grown during the pandemic.

The cloud emerged as a clear differentiator for SMBs in 2020. Cloud technology helped them shift to a virtual or remote work scenario during the pandemic and launch new virtual services. Employees could obtain real-time access to business process tools even while working from home, and the cloud also accelerated the shift to line sales via ecommerce.

When asked about their use of cloud-based services and solutions, SMB Group reports that in every category, 83 percent or more of respondents said cloud applications have been extremely/moderately valuable in helping to survive the COVID-19 crisis.

Cloud solutions also provide a valuable sense of control during volatile times. SMBs could plan for various scenarios and forecast how new service offerings or policies might affect their business. According to the report:

“Cloud solutions have enabled SMBs to access applications and data from anywhere. Having proved their worth, SMBs will move more business processes to the cloud sooner than they would have planned before the pandemic to maintain business continuity. But the value will extend far beyond this as cloud vendors embed new technologies—such as artificial intelligence (AI), machine learning (ML) and natural language processing (NLP)—into their offerings to supply SMBs with more automation and insights.”

Cloud adoption was already reasonably healthy before the pandemic, with 59 percent of SMB respondents reporting they were already using cloud-based business apps and 49 percent using cloud-based file-sharing or backup solutions. Implementation of cloud services and solutions increased by double digits during the pandemic across all categories — from 14 percent of respondents shifting to cloud-based business apps to 27% doing so for video/web conferencing. New adoption of cloud-based security during the pandemic was reported by 19 percent of respondents, on top of the 44 percent that already used those solutions.

The SMB Group report predicts these cloud investments will continue expanding:

“Cloud computing has been a lifesaver for SMBs during these trying times, enabling them to adapt to new operational requirements and to keep up with changing customer and employee requirements. More than 80 percent of respondents said cloud-based business applications have been valuable in sustaining their business, and 37 percent noted that the pandemic has made them more likely to choose a cloud solution for new application Investments.”

Help Your Customers Become Nimbler and More Secure

What does this mean for MSPs? For starters, those with cloud-based service and product portfolios can take advantage of current conditions to make a more significant push for services among SMB customers. Now that a considerable number of these companies have been forced to experiment with the cloud for everything from video conferencing to security and backup, they may be much more open to making the switch to the cloud permanent.

The recovery expected in 2021 can also help lay the groundwork for MSPs to help current clients implement disaster response and recovery plans as well as evaluating their customers’ security postures. No one was prepared for the slow-rolling disaster of 2020, which affected every sector to one degree or another and created IT and logistics challenges for companies that were not set up for remote collaboration scenarios with their staff and clients/vendors.

MSPs can now make a strong case for cloud-based solutions serving as a foundation for a rapid response to future challenges (anything from cybersecurity incidents to natural disasters to even a gas leak requiring a building evacuation). The cloud makes it easier to shift operations at a moment’s notice with minimal business disruption.

SMBs were already embracing the cloud before the pandemic because it offered flexibility and agility, resource allocation and ease of use. The pandemic pushed them to test these solutions in even more application areas like security, IT access, and collaboration. MSPs with cloud services expertise can help them maintain this momentum while potentially improving their competitiveness and profitability.

Neal Bradbury

Vice President, MSP Strategic Partnerships for Barracuda MSP, a provider of security and data protection solutions for managed services providers, where he is responsible for generating greater business value for the company’s MSP partner community and alliance partners.