Asia Insights with Johan Uittenbogaard & Mako Kosuge in Japan

Having completed again several Japan Country Leader positions this year it has been interesting to have conversations with local leaders on the penetration of the ‘mid-market’ segment. Apart from the different labelling that companies give to this segment and what is the definition of mid-market, we realized that quite a few regional and global leaders do not have a good perception of the opportunities that are there outside of the so-called “Large Enterprise”.

Most foreign-affiliated companies identify so-called Strategic and Large Enterprise accounts. The next group down suddenly becomes very large – thousands of companies would qualify for mid-market. The reality is though that most western technology vendors are selling to companies that do have an international presence of some sort. This total group of companies would still be around 2,000. A massive potential market to sell to.

Speaking to the local leaders for US & European tech vendors, we continue to hear that the CEOs of these mid-market companies often have a relatively high IT literacy.

Interestingly the results of our Leadership Confidence Index report (in partnership with Forrester Research) which was a global survey indicates a low IT literacy level in the leadership teams.

The case in Japan might have to do though with relative literacy. Once you go down through the ranks IT literacy tends to be low, much lower than within the Large Enterprise segment.

In terms of selling tech solutions, the top-down, CEO approach is the most obvious way to a successful win. These CEOs almost only want to talk about digital transformation, because they know it will be so much harder to accomplish when most of your staff is using faxes.

Their biggest challenge is improving their overall IT literacy in their organization.

With the local and global SI’ers and Consultancies not spending their efforts on this mid-market sector, and with companies lacking anything close to adequate resources to drive transformation and education themselves, the responsibility goes often to the tech vendor and their lesser-known partner companies in Japan.

How you enable these partners, and customers who typically do not have English ability, is a key to success in this challenging but massive market space.