Misys Plc, based firmly in the heart of Shakespeare country, just out side Stratford-upon-Avon, is something of an enigma – at first glance a hotch-potch of unconnected computer software and hardware businesses that seem to have little in common apart from the fact that the rather anonymous group as a whole has performed remarkably well since it came to market less than two years ago. What is the secret of the Misys success, and how does chairman Kevin Lomax, who includes the magic name Hanson on his curr iculum vitae, plan to maintain the momentum? Katy Ring visited the company, and the first part of her report app eared in CI No 1,120. Today she concludes her report with the latest moves and the company’s plans for the future. One new market area where Misys Plc chairman Kevin Lomax is prepared to express an keen interest is in the Unix market. Indeed, the BOS operating system has recently been developed to run under Unix. At present there are no plans to run the company’s proprietary Tripos operating system, under which its original core insurance applications are written, to run under Unix, but it seems a likely eventuality. Although he is on the prowl, Lomax would not be drawn on which Unix houses he might be interested in buying but denied he was interested in Sphinx Ltd, which is widely believed to be for sale. Although Misys is definitely not interested in companies that develop bespoke customer-specific – software, or in the pure distribution of printers or hardware, because such businesses are too labour intensive and don’t generate enough cash, Lomax said Misys would not dispose of either Zygal Dynamics or CHA Installations because they were profit-able businesses that could be expanded. The impression that this type of management would lead to a washing line of unconnected companies was countered by Lomax, who said that the Misys Group would evolve a divisional structure whereby independently-run subsidiaries would become part of one of four or five divisions. Multi-site operations would then be managed at divisional level, with companies in each division ex-changing ideas on their techniques and cross-fertilising each other’s approaches. Lomax believes that synergy between companies will then develop by itself at meetings where management teams will consider how best to collaborate over commonly perceived business opportunities. In fact, Misys makes a business principle out of not anticipating synergy between companies, in the belief that this type of thinking often leads to disappointment and bad acquisitions. Exactly which areas of business these divisions would encompass was not made clear, but a guess is that they would focus on particular user bases such as IBM, DEC, Unix, and so on. Whether such divisions would be capable of offering employees of the Misys group a strong and attractive corporate identity is questionable. At present attempts are being made to court the loyalty of employees through increased employee share ownership. To this end the company hopes to establish an EPOS trust as a vehicle for providing additional share-related benefits to employees. This measure will be discussed at the the company’s annual general meeting in September. No digestion problems Meanwhile the company expects to maintain an earnings per share growth rate of at least 35% over the next two years, while analysts are forecasting a growth of 66% in pre-tax profits for the 1989-90 financial year. In response to criticism from some City analysts that the Misys Group is growing at an unsustainable rate, Lomax said that organic growth was the mainstay of the group’s earnings per share growth, with only approximately 15% of that growth coming from acquisition. He added that the group was only committed to the acquisition of companies with sustainable organic growth and would not buy companies that would dilute that growth. Furthermore, because his management strategy does not put a premium on integration, an acquisition policy could be pursued without any digestion problems. Whether it can continue to be successfully purs
ued from Stratford-upon-Avon, however, is a moot point; and Lomax admitted that he may have to relocate the head office in London at some stage to enhance the group’s relationships with the City. Let’s hope the entrepreneurial muse that seems to be present in Warwickshire doesn’t fail him in London.
The BOS Software arm puts its line up under Unix
In a bid to become the UK market leader in business software, the BOS Software Ltd arm of the Misys group has launched a new operating system, Apex, which marks BOS’s move into the Unix market. The launch of Apex means that BOS can now offer Global 2000 applications software to users of all personal computer operating systems – PC-DOS, with or without Microsoft Windows, Unix, and DEC’s VMS operating system for minicomputers. At present the Global range has a user base of 15,000, but the introduction of Apex looks set to expand that base. If it doesn’t win converts from the technology, BOS hopes to catch them through aggressive marketing. For, no doubt with a little entrepreneurial push from Misys chief Kevin Lomax, BOS has joined forces with Technology for Business Plc and Altos Computer Systems to sell a total business solution. The solution comprises an Altos 5/386 Unix system that runs Global 2000 software, marketed through the London EC1-based Altos distributor Technology for Business, which has exclusive rights to the distribution of Apex on Altos 5/386. The three companies involved have invested about UKP200,000 in this marketing initiative. The system is being demonstrated at the Which Computer? Show where visitors will be invited to see the complete range of Global 2000 modules, plus third and fourth generation programming tools, running under Apex on Altos machines. However negotiations are currently under way to sell Apex on other makes of hardware as well.
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