As Published In
Oracle Magazine
January/February 2007

COMMENT: Analyst's Corner

The Right Stuff

By David Baum

Small businesses can compete on a big scale if they have enterprise-caliber software.

Donald Feinberg is a vice president and distinguished analyst at Gartner. He talked to Oracle Magazine about how the business world is changing for small and medium businesses (SMBs) and how technology vendors such as Oracle are responding to these changes.

Oracle Magazine: SMBs are adopting increasingly complex IT environments to keep up with business demands. What issues do SMBs face today, and why have these resulted in enterprise-level software deployments?

Feinberg: It's important to establish why so many small companies are interested in enterprise-class software. Take the manufacturing industry as an example. Until recently, small companies in this sector mainly catered to local markets or specialized niches because they didn't have the resources to reach much further. Now even small shops can compete with big companies because they can connect and exchange information online. However, if they can't participate in the supply chain, they can't sell to the big guys, and that's why they need enterprise-caliber software. We're seeing this trend in many other industries, not just manufacturing—anywhere where the business world is dominated by SMBs. These companies need high-end software capabilities to service a worldwide market.

Oracle Magazine: How are today's database products addressing ease of administration, tuning, and upgrade?

Feinberg: These software products are improving in several ways, from fast installation to automated storage management to push-button data recovery. Essentially, vendors such as Oracle are making the databases simpler to use and more self-managing, so they will work right out of the box. A self-managing database is particularly attractive to SMBs because they don't have to hire a battery of technical people or pay a systems integrator to set it up and take care of it for them. This was not the primary reason for automating today's database management systems, but it's certainly one of the side effects that have benefited SMBs.

Oracle Magazine: What level of security do the entry-level database editions like Oracle Database 10g Standard Edition One provide?

Feinberg: Oracle provides the same security model in all of its database editions. Of course, you still have to set up the security. Many SMBs hire a systems integrator or professional services organization to help. There are lots of boutique companies that specialize in installing software applications, developing data warehouses, configuring identity management systems, and even selling remote DBA services over the internet.

Oracle Magazine: What compatibility challenges do SMBs face in upgrading their databases to enterprise editions?

Feinberg: There isn't any upward-compatibility problem at all. The only problem is money, since the higher-end editions are more expensive to purchase, implement, and maintain. One way to get around that is to avoid customization. SMBs usually end up modifying their business processes more than modifying their software, which makes it easier to upgrade to a larger edition.

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Oracle Magazine: Do the requirements of SMBs for database software also apply to application software?

Feinberg: The reasoning is the same: SMBs don't want to hire specialists to deploy and maintain their application environments. They want to manage their businesses. This gives them two basic choices: Either they can go to a small application vendor and buy a complete software package, or they can subscribe to an on-demand version from an enterprise software vendor. This second option is becoming more and more popular. Today's SMBs can outsource just about everything, from computers and physical infrastructure to communications devices, phone systems, and all types of software. That is an appealing prospect to a lot of small companies.

Oracle Magazine: What requirements top the wish lists of SMBs looking for simple, turnkey database software?

Feinberg: Most SMBs don't have large IT budgets or a great deal of expertise in their IT departments. Thus they tend to favor proven solutions that are easy to install and configure. That said, they still want top-end performance, availability, security, and reliability—all at a comparatively low cost. This leaves them with a couple of choices. Either they can buy database software especially geared toward SMB shops, or they can purchase an entry-level edition from one of the enterprise database management systems vendors, such as Oracle Database 10g Standard Edition One. 

David Baum ( is a freelance business writer based in Santa Barbara, California.

Founded in 1979, Gartner researches, analyzes, and reports on vendors, technologies, and business processes in the IT industry.

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