Computer Associates (CA) is on the services company acquisition trail again - and this time it has Australian companies in its sights.
Following its failed bid to buy Computer Sciences Corporation (CSC) earlier this year, CA has revised its plans for building its services empire and will now purchase individual companies in each of its regional markets.
Describing the new strategy as "plan B" following the unsuccessful takeover, Allan Smith, CA's recently appointed managing director, said the company has shortlisted six Australian service companies it plans to target. Smith declined to identify who they are, or even if CA has approached them yet.
But Smith said that process, as well as decisions on who will head the new services organisation and which businesses CA will be partnering with, will be made within three months following discussions with Chris Wagner, executive vice president of the CA's professional services organisation.
"The whole drive of this is to add value to our clients. We do it with the software, we've just got to do it with the people as well," he said. "I believe our services organisation has to be project manager-based because CA is never going to be able to do all of its implementation and technical services - we will always use business partners.
"So the role of our project managers in managing implementations and the relationship with business partners that we sub-contract to or work with is absolutely vital to the success of each project."
Smith believes effective project management skills across CA will maintain a consistency in the company's services approach worldwide.
"Project management is intrinsic to its success. If we can get that bit right, we can use almost any business partner and maintain consistency to what CA delivers," Smith said. "We have some fabulous intellectual capital manifested in our implementation processes - they're very structured and very methodical - and we deliver it very well.
"If we can lock our business partners into that methodology and have our business partners deliver to that methodology, we have great flexibility in who we can sub-contract different chunks of work out to."
Smith said there will be a defined split between CA's role and the roles of business partners. The only "critical CA" areas will be project management and specialist technical advice.
"If the CSC acquisition had gone ahead, we would be a company of nearly 3000 instead of 300" Smith said. "That was the direction CA wanted to go in so our organisation better be ready to move in that direction. That is going to mean a lot better management and a lot better information processes than a company of 300 would typically need."
Smith said CA is also planning to grow its services arm organically, adding to its internal staff. In all, he anticipates CA's local services sector will total almost 1500 by the year 2000.
Smith also highlighted other channel strategies designed to increase CA's indirect model to 50 per cent in a similar timeframe.
"The move to 50 per cent sales indirect is driven by a number of things but they're evolutionary, not revolutionary," Smith said. "It's driven by the TNG sales success in a couple of areas - firstly, we want to use our business partners to implement our TNG sales, and secondly, we want our business partners to leverage off the success of TNG down at the lower end of town with functional products."
The "functional products" Smith refers to include ten new releases that have been made available exclusively through the channel.