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February 17, 1999

IT SERVICES: GETRONICS GROUP GROWS EUROPEAN WINGS

By CBR Staff Writer

After 23 years in charge, Ton Risseuw, who has stage-managed Dutch IT services firm Getronics Group NV through formation, flotation to recent restructuring, is to step down as president and CEO. The restructuring, from January 1 1999, converting Getronics into a business group, provides a coda to Risseuw’s reign. It is time for a new face. Cees van Luijk, aged 43, is the global middle market leader of PricewaterhouseCoopers global organization. He has been influential in merging Price Waterhouse with Coopers and Lybrand and turning it into a Plc. The choice of van Luijk, with his experience in the multinational environment, is a clue to Getronics’ international aspirations. Getronics has a strong presence in Holland, providing services to multinational Dutch companies like ABN-AMRO, Royal Dutch Shell and Royal Dutch Airlines. It is under-represented however, outside the Benelux region. Its clients’ international demands have spurred expansion into Western Europe. Germany, France and the UK are the first tier, Italy, Switzerland and Sweden represent the second wave. Getronics already has a foothold in Scandanavia; it owns Ark, a Norwegian Information and Communications Technology Systems (ICT) company. So far, Getronics’ strategy of acquiring a mid-ranged company with local expertise and using it to leverage its own market frontage has worked well. The blueprint, though, is not inflexible. No country is far from Getronics plans, witness the purchase of Spanish consulting firm Grupo CP, in June 1998. Getronics focuses exclusively on high-end market sectors which Peter van Voorst, senior vice president, explains means over 1000 desktops. Financial and business services is the principal field, representing over a quarter of its business; ABN-AMRO is typical. Trade, transport, media and telecommunications come next with between 20%-25%. Van Voorst adds that the telecoms sector is expanding by 20%-40% per year and that Getronics deals with many of the key operators, both in its home market (Libertel, KPN Telecom) and in Europe (Vodafone). In the third field, government and non-profit organizations (20%-25%), Getronics has run into some trouble, suing the Dutch home affairs ministry, which canceled its contract for ensuring the civil service salary system was year 2000 compliant, claiming progress had been too slow. The home affairs ministry has retaliated by issuing a counter-claim of $8.7m. Getronics began life reselling platforms and applications from major names including Compaq, IBM, Cisco and Sun Microsystems. Since then, it has aimed at a fuller provision of services to complement distribution, acquiring several integration services. In 1998, for example, Getronics absorbed Wavin Computer and Network Services, IBM ASAP, a wage processing application vendor, to accompany its Spanish consulting purchase. Revenues still stem mainly from ICT (over 50% of total revenues for 1998), in which the wholesale element figures strongly among outsourcing and network design. Increasingly though, Getronics is aiming to provide a ‘one-stop’ solution for end users, offering software and consulting packages (25%) and services (23%) to unify the client’s entire IT demands and thereby entrench the customer relationship. The systems integration and network services component is the key sector for growth, reveals its head, van Voorst. His division employs 8, 000, and specializes in both local and wide area networks. Getronics ranks third in Holland for services, trailing CMG and Cap Gemini. Getronics’ 12, 000 personnel is a far cry from the 200 with which it started in 1983. Revenue growth has never fallen below 20% and the profit levels are similarly even, says van Voorst. Getronics is rarely spectacular, its geographic, personnel and financial expansion have been steady if not stealthy, but spectacular has never been its style.

This article is part of ComputerWire’s European Computer Services information service. Some articles from the service are being provided to ComputerGram subscribers for a trial period only.

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