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July 17, 1991

PANSOPHIC REORGANISES TO ACCOMMODATE MULTINATIONAL USERS WANTING A FEDERAL EUROPE

By CBR Staff Writer

Pansophic Systems Inc, having been around for 21 years is serious about being around for the next few decades and, consequently, has taken itself in hand and restructured. First and foremost the company has divided itself into two functional businesses: systems software and applications software. Last year the company reported a turnover of $230m – 70% of which came from systems software, 30% from applications, but the applications side grew by 46% over the year. The applications business focuses on the AS/400 environment and centres on the manufacturing and distribution sectors for which it offers a complete set of modules of 20 or so components and boasts Robert Bosch GmbH, Johnson & Johnson Co and Lotus Development Corp as users. Following on from this change, Pansophic has completely reorganised its international strategy. Europe is no longer viewed as a set of separate national entities with managing directors, but as a federal state, an open market with a business structure to match. Terry Ewing, international vice-president of Pansophic is heading up the new look international division, based at Uxbridge, Middlesex. Underneath him are six new divisions: systems software field operations, applications software field operations, marketing, customer services, finance and administration. Underneath these six division heads are area directors for the UK, Europe North – the Nordic countries, Europe Central – Germany, Holland, Europe West – France, Belgium, Europe South – Italy, and then directors for major accounts and for agents and alliances. This structure sounds uncannily like that presented by Sybase Inc the other week, although Pansophic says nobody has resigned and there has been no coup. The motivation for this trend in software companies restructuring their international operations appears to be pressure from large, multinational customers that want to deal with companies with a clear, consistent global image. Customers such as Eastman Kodak Co are looking to cut down the number of vendors they do business with and this federated international approach seems to be one of the criteria for getting on to their supplier shortlist. Ewing says it also has the advantage of elminating internal country to country competition within companies. Multinational sales will be handled by the major accounts director, direct national sales will be handled by area directors, while sales to companies with a turnover of less than $20m will be handled through agents and allies. The major accounts division is demanded more by the applications side of the business where multi-nationals want a common core product translated into a number of languages, than by systems software. With this new international structure, Pansophic is giving itself a three-year window to grow to contribute 50% of world revenues and 50% of worldwide profit margins – international business now accounts for about 40% of revenues. Details on Pansophic’s intended acquisition of Realia Inc remain sketchy as the deal is not yet done, however, Terry Ewing did say that the merger will take Pansophic into the shrink-wrapped software marketplace for the first time as well as offering the company a distribution channel for the desktop environment. Telon has an open architecture so that customers can choose to remain using the generator with Micro Focus Plc Cobol, or they will soon have the opportunity of using Realia’s Cobol. While agreeing that access to object-oriented Cobol development was part of the attraction of acquiring Realia, Ewing declined further comment.

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