It would not be unfair to say that Memorex Telex was in a holding pattern for much of last year. Although the company performed well, and even signed on as Cisco's first Australian Gold reseller, the troubles of its former US parent and its drawn-out sale to the Kanematsu Corporation limited the company's ability to set long term goals.
But those days are long past, and the company is now poised to launch itself as one of the premier network integrators in the industry. These are the words of recently appointed managing director Chris Cheadle. The former Unisys networking boss is now at the helm of a company he believes has the resources and ability to take great steps forward this year. "We are a very different style of organisation to the one that we might have formerly represented," says Cheadle. "We've got a new management group, we've got new ownership, and we've got a direction, and we are now absolutely in a position of take off."
That position is very different to the one Memorex Telex faced last year while its sale to the $US63 billion Kanematsu group wound out over six months. "That was an extraordinary impost on the business," said Cheadle, "so we're a company that has been somewhat lacking in focused leadership. The most important role I play now is to draw a management team together inside the Australian organisation, and spend some time understanding what our core competencies are, and then working on steering us towards a successful path to the future."
While the company has retained the Memorex Telex name, Cheadle says the purchase by Kanematsu has had a more far ranging and positive impact within the company. "Memorex Telex is now supported by a company that doesn't take a 90 day view on how a business must be making a financial return. The Japanese take a very long distance view of how their investments are performing; they are looking at making goals within three to five year timeframes. Also through Kanematsu we're in a position to leverage some of their purchasing power internally, and take advantage of the alliances and corporate products that they've been involved with.
"And the Kanematsu group has clearly given us enough capacity to build a business the way we think is appropriate here."
Although still new in the job, Cheadle already has strong views on the integration marketplace. "The marketplace is now looking for more and more value to be added from large scale integrators. I also think we've got a marketplace which is really going to polarise even more than it has in the past." He says that polarisation will occur between those large integration companies capable of serving the needs of enterprise environments, and niche players. "I think those two spectrums will move further and further apart over the next 18 to 20 months. In the past Memorex Telex has never viewed themselves as being capable in that end, and we've now got to prove to ourselves that we can be."
Thus Cheadle is taking Memorex Telex into an aggressive period of growth, increasing its current staffing level of 220 by 20 per cent over the next 12 months. And it is the quality of its staff that Cheadle believes sets Memorex Telex apart. "We are certified in every instance to the highest level at every technology we work with. I know of no other company that's as well certified and qualified technically as we are. And we have a national presence, which enables us to apply that skill across the whole country."
That level of skilling is essential if Memorex Telex is going to meet the changing needs of the marketplace, says Cheadle. "The market has an almost insatiable desire for services, and we regard the provision of equipment purely as one of these services. So we provide consulting services, design and architectural services, implementation services, and we'll provide ongoing service, and support and maintenance of those networks.
"Each of those pieces are also available independently - we don't have to do the entire array of service for any one particular customer. But clearly that's where we believe we offer the most value."
Those services are provided through assets such as the in-house engineering group and integration management team, which Cheadle believes allow Memorex Telex to provide a wide range of services to a mature marketplace. "I think in the marketplace now there is a desire to treat a network as a utility - it must come on like a power switch or a tap. And we're in a position at Memorex Telex now to start pushing that boundary of utilitisation, where we can provide a complete service to a customer, not to replace their existing infrastructure necessarily, but to assist in what they are currently working with."