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February 5, 2010

Q&A with Brett Dawson, CEO of Dimension Data

Brett Dawson, CEO of Dimension Data talks about the IT services firm's vision for providing managed services

By Vinod

Q What’s your vision for the company?
A The last five years have all been about securing our position in networking. Our vision from that point was that the network would be the platform for communication. Five years ago that was revolutionary thinking, now it’s old hat! The next three to five years will be about managing IT operations rather than any one technology. So that means, for example, providing a customer with a full voice service not just fixing a phone. We do lots of different things from voice, managed services, data centre security and integration, infrastructure management, unified communications and collaboration.

Q How is the trend towards cloud computing affecting your business plans?
A There’s a lot of hype about the cloud, but what we do know is that it will need much more reliance on a more robust network, so we see it as an opportunity. Our clients are going to need to know about security and how and where to source data and we would like to work as a cloud integrator. We believe there will be a hybrid model [on-premise and in the cloud] for some time to come. Clients will need to work out which applications should go to the cloud and which should stay and how to keep everything running. Their infrastructure needs to be in the right kind of shape and we can help with all that.

Q How did you weather the recession of 2009?
A Our clients were interested in cost savings through consolidation of support contracts. Multinationals have dozens of support contracts and we’d go in and manage them bring customers typically 20% of savings.

Video has also been a big growth for use in the last year, both into the boardroom and into the desktop. It also brings very fast ROI in terms of savings on travel and the green footprint.

Q How is the UK market?
A We’re pretty pleased and we’ve done better than you might expect in the UK looking at the headlines on the economy. With improved growth and revenue we seem to be holding up pretty nicely.  I think the economy still looks tough though.

We operate in 47 countries round the world. The biggest region is the Europe and the UK and Germany are our biggest markets there. In the US we have a lot of customers who are global financial institutions which affected business last year, but this went into turnaround in Q4 and the recovery is continuing. Financial services is our biggest vertical. In the UK, our customers are financial institutions, media and communications and we do a lot of work for mobile operators. Within Europe our single biggest vertical is telcos, followed by financial services.

Q  What are you doing on the managed services side?
A We’ve been in managed services for five years and have a defined strategy to move further into managed services. We started doing maintenance then added support and continue to add value and monitor and respond and restore. Beyond this, we’re starting to manage IT operations such as voice or security, but not as an outsourcer.

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In South Africa and Australia because we are a very well-known brand we can straight way talk about managed services with clients. But in Europe we are still seen as maintenance and support specialists, so we take things one step at a time; it is an evolutionary process. The bulk of our business is still in maintenance and support but in five years time it will be more of a spread.

We try to differentiate through operational excellence. We’re not about PowerPoints, we’re about delivery. We want to be the driving execution rather than driving strategy alone.  A lot of consultancies talk about IT strategy, while we want to set strategy we also execute it.

Q What are your plans for the coming year?
A Five years ago we said the aim was for double digit growth and we were growing 17% up to start of 2009 and that’s still about 11% now. Looking at the next five years are intent is to have double digit growth.

Q How will you do that?
A We see the IT services market growing at 3-4% and on top of that look to grow in high-growth sectors such as data centre networking, performance optimisation and wireless. We also must recover in some under-performing geographies and will drive services growth rates and look for market-share gains in existing geographies. Emerging markets should provide additional growth.

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