NEWS FEATURE: Making the transition
- 29 April, 2011 16:13
Transition Systems is a growing distributor in the video and network space, and its managing director, Michael Beesley, isn’t finished yet. He sat down with ARN to talk about where the company has come from, and where it is going.
Transition Systems was founded in Singapore in 1999. Headed up by Executive Director, Jonathon Lee, the distributor represents a mass of vendors at all levels, including Juniper Networks, McAfee, Motorola, Polycom and Alcatel Lucent across its many South-East Asia and Indian offices; it maintains offices in Indonesia, India, Malaysia, the Philippines, Thailand, and Vietnam in addition to the Singapore head office.
The Australian division of Transition Systems is a new kid on the block. Set up following the acquisition of Unitel from failed Commander in 2008, Transition Systems Australia Pty Ltd is managed by Michael Beesley and is based in Roseville, Sydney. Here, it represents just five vendors: Polycom, Motorola Wireless Network Solutions, Vaddio and Silver Peak Systems. Infoblox is its newest signup.
Beesley, who owns shares in the Australian division of Transition Systems, is a man confident of the future of the company, despite being a new brand in a mature market dominated by a small handful of incumbents.
“A new distributor needs a strong support base,” Beesley said. “Whether it’s from a parent company from overseas, or they’re financially sounds enough to grow or sustain that investment for a period of time.
“As an overall business we continue to grow aggressively, and we will continue to do that. In distribution you can do that by putting on additional vendor partners, but then you need to consider the services component and being able to deliver on their expirations at the same time. It might take six months before we start to see return on the investments we make there.
“We’re structured for growth. We have the capacity to scale, we’ve invested in sales people and technical resources today so we can grow our business. So far it’s proving to be the right strategy.”
Setting up challenges
Not that it’s easy going. Though Transition Systems represents a number of tier 1 vendors in the South-East Asia region, with the exception of Polycom, which was an existing partner to Unitel, those vendors have yet to sign with the local outfit.
These vendors have existing distribution relationships in the Australian market, and they’ve yet to see the additional value that Transition could bring the local operations.
But Transition is keen to present itself to market as a genuine value-add distributor, and Beesley said it has been making significant investments in this regard in recent times.
“Through 2009 we re-established ourselves and approached all the customers we had under the Unitel banner, with the underlying premise to expand our operations into the network and security, so basically drawing down on the experience and level of contacts throughout South-East Asia and what the parent organisation has as well,” he said.
“We’ve had a leading vendor in Polycom, and the business has evolved, as we brought on new vendors, we’ve moved the organisation away from a product-focused structure to more of a functions-based structure.”
The Transition sales people are now expected to wear multiple hats, for instance. Charged with hunting out opportunities, the sales people can now also draw on an increased investment in technical support, and bring in subject matter experts – whether that be in one specific technology, or in building solutions.
It’s a new structure that just kicked off at the start of the year, but doing things in new ways is part and parcel with small businesses, Beesley said.
“The business evolves every three months, so you’re constantly looking inwardly as well as outwardly to see whether you can improve the way in which you service your customers.”
Looking outwardly, Transition has seen a transformation in its core customer base. Perhaps in line with its branching portfolio (or a reason for the broadening of vendors), the traditional AV integrators and conferencing specialists are undergoing an evolution – the IP network has invaded their space, so they’ve had no choice but to adopt.
And in turn, Transition is generating some interest from the network partners, who are now expected to be able to provide conferencing tools on top.
“We’re seeing a lot of these network partners we’re engaging with – perhaps for SilverPeak for WAN optimisation – coming to us and saying ‘oh, we’d like to carry Polycom as well, how do we go about doing that?’” Beesley said.
“You’re seeing a lot of the traditional AV type companies either morphing into an integrator, and also perhaps the integrators taking on the video solutions in the conferencing space.”
Proof that these solutions are becoming more complex can be found in Polycom’s own acquisition strategy. On March 24, the vendor announced it was acquiring video content management and delivery solutions vendor, Accordent Technologies, for $US50 million.
Accordent will be used to strengthen Polycom’s integration with Microsoft Lync and Sharepoint and assist management in all forms of video streaming and delivery.
This additional breadth and reach has seen a pronounced upswing in the interest in Transition, and indeed led to the fortuitous backfire – at its recent partner conference, the facilities the distributor hired were deliberately limited in size so as to not appear empty, and the turnout so impressive it was packed to the point of discomfort.
In amongst the throng of people, however, it becomes quickly evident that Transition is well supported by its vendor partners and its reseller community.
What’s next for Transition? Transition remains an Australian company. Despite being owned by a Singaporian-based group, the company board understands that the business environment in Australia is different to other regions, and Beesley is left in control with a light touch from the head office.
That said, belonging to a multinational organisation of some 300 people brings with it a set of advantages and resources to Transition Australia that it would not have had otherwise. Silver Peak, for instance, leveraged its regional partnership with Transition to gain its first substantial presence in the Australian market, and gave Transition Australia a vendor point of differentiation.
“The other benefits of it is we have the opportunity to reach into the body of knowledge that is sitting within the people in the organisation,” Beesley said. “There’s also the opportunity to run synergistic programs throughout the region, not just by country.”
Transition has set targets of double digit growth for all of its vendor partners this year, and although Beesley is more interested in realising a return on current investments than spreading the butter too thinly, he has not ruled out looking for further vendor appointments at the end of the year.
“We have a number of vendors out of South-East Asia that are knocking on our door to come into the Australian market, so they can get consistency across the region,” he said.
“But in bringing on other partners we’re being quite selective in the number of partners, because I want to be able to ensure we’re able to deliver on the expectations of that vendor. Yes, I could put on 10 vendors but I wouldn’t be able to service them all in the way in which we intend to do that.”
At the transition partner conference, Beesley told the assembled group that ‘we are a distributor of hardware products and technical products, but we’re about providing hardware for the solutions to your customers needs."
In just two-and-a-half years, the distributor has gone from one vendor and being part of a failing company to five vendors, is on a recruitment path, and claiming a position as a value-added distributor. It might not be a multinational of the same scale as Ingram Micro, but it appears to be a confident one.
“There’s always going to be a need for niche distributors,” Beesley said. “Vendors like the large distributor because they have that reach, but I think more and more customers in Australia are looking for both – they want to have that personal touch, and want to ring up a technical expert and quickly get an answer to the solution they need to present to their customers right there and then.”