Abstract

Small and medium businesses (SMBs) play a major role in economic activity in the world. In the ever-changing technology landscape, one of the many challenges that small and medium businesses (SMBs) world over encountered was access to funds to procure technology that would enable business growth, productivity, and profitability. In the past, SMBs and entrepreneurs had looked to traditional financial institutions for additional funds. However, the arrival of technology providers as lenders altered the scenario, opening up new vistas for a convenient and flexible mode of credit, specifically for technology acquisition. Global leaders in information and communication technologies (ICT) such as IBM Inc1, Cisco Systems2, Dell 3, Hewlett Packard4, and Microsoft5 besides a host of mid-sized players such as Nortel6, Lenovo7, Avaya8, and Alcatel-Lucent9 offered customizable financial solutions. The credit covered hardware, software, training, and maintenance. Some organizations such as IBM Global Finance also offered project finance encompassing the customer's business transformation processes. Through no-interest lease options and low-interest flexible financing schemes, technology vendors entered into short- and long-term relationships with SMBs, giving them the freedom to invest in business expansion activities rather than worry about IT spends.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

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Keywords

Small and Medium Businesses, SMBs, Information and Communication Technologies, ICT, Customizable financial solutions, Technology acquisition, Legacy equipment, Technology obsolescence, Leasing, Finance lease, Operating lease, Sale and leaseback, Resellers, Channel partners, IBM Global Financing, Cisco Systems Capital, Dell, Microsoft, Hewlett Packard, HP, Enterprise Resource Planning, ERP, Supply Chain Management, SCM, Customer Relationship Management, CRM, Unified Communications, Internet Protocol, IP, telephony, Virtual Private Networks, VPNs, Intranet, Business growth, Operational efficiency, Investment protection, Remote connectivity, Small and Medium Enterprises SMEs