It’s been hell, but we’re back, says Olivetti Computers Worldwide, the independent and slightly renamed former Olivetti Personal Computer arm of Ing C Olivetti SpA. Emerging from the turmoil of its recent years as a loss-making Olivetti company, and the even greater turbulence of its breakaway from the erstwhile parent, the company is apparently set for growth and looking to break even by the end of the year. Roberto Schisano, group chief executive of the new company and chief executive of its majority shareholder Piedmont International SA, says the company has got its financing sorted out, has completed its internal restructuring to bring its finances under control, and following recent speculation about its future viability, says it is definitely in for a long time. The Olivetti Computers group has been restructured into three companies, with all business outside Italy coming under the auspices of Olivetti Computers Worldwide International BV, led by chairman and chief executive Bernhard Auer, who also lived through tough times at Digital Equipment Corp before joining Olivetti in 1995. All Italian business, including the manufacturing team at Scarmagno, is now under OP Computers SpA, which has Shisano as chief executive, and the third company is OCW Finance. With the help of a newly installed SAP AG R/3 computer system, which will handle all aspects of its business including manufacturing, the company says it identified those areas which although high volume, were unprofitable, including much of its retail business outside the UK, and it ruthlessly axed these businesses, reducing its revenues by about 33% this year it says, to around $700m. It will now focus on higher margin business particularly servers and notebooks for the professional market. Schisano says 1998 will see it heading back to profitability, but wouldn’t commit to expecting profits before the middle of 1999. Both Schisano and Auer insist there is no stigma attached to the Olivetti name, and are happy with the deal to pay Olivetti SpA royalties for its use for 20 years, renewable for a further 20. Asked what will differentiate the new Olivetti Computers from the competition, they have less to say. It seems the company’s new ‘medium’ size, gives it a nimbleness and flexibility to respond to customers needs, and means the customer feels it has someone accessible to talk to. Is that enough to bring the profits flooding in?
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