Mid-size maestros find local skills in demand
- 12 August, 2007 17:38
Recently announced annual financial results suggest mid-tier services players reaped the lion's share of rewards, marketing their local strengths to a buoyant IT market.
SMS Management & Technology's profit leapt 52 per cent to $18 million in the year to June 30, with revenue also up 37 per cent to $176 million. CEO, Tom Stianos, said customers wanted nimble service providers that could offer economies of scale but with a local touch.
Many had turned away from global providers, finding the response on the ground too slow, Stianos said. SMS focused on quality delivery - achieved by properly executing the right strategy. "Profi t is an outcome. If you focus on profit you will eventually fail," he said.
Over the years, SMS had concentrated on getting the breadth and strength of resources - especially staffing - to deliver the highest quality products and services.
"Skills are key. We harness multiple channels to bring people in: not just those with Java or .NET, but businesspeople, ex-bankers and probably about 20 per cent of our people are ex-military officers," Stianos said.
Acquisitions are a good way to build strengths - but not if used merely to bulk up. They needed to bring something new and relevant to the table, Stianos said.
Net profits were also up 26 per cent to $7.2 million at Data#3, where general manager, Laurence Baynham, agreed with Stianos. Its strong financials stemmed from a focus on quality, which he said had a tendency to attract good customers as well as top employees.
"Consistent results really help, and consistent management really helps," he said.
Baynham added that Data#3 had secured a lot of work in booming verticals such as resources and healthcare. UXC Group announced annual profits of $24.5 million, up 48 per cent on the previous year. Revenue was up 52 per cent to $457 million, with growth accelerating in the second half.
Executive chairman, Geoff Lord, cited three macroeconomic sweet spots: strong demand for IT, government spending and state support for environmental initiatives.
"Major Australian IT clients who have traditionally awarded large turnkey projects to multinationals like EDS or IBM are breaking contracts into smaller pieces," he said.
"All premiers have announced large infrastructure spends over several years on electricity, water, roads and transport. [And] support of programs for the reduction in water consumption and emission generation has enabled us to build a world class environmental solutions practice."