Norris warns of worse to come

Mike Norris: CC took large hit from Lehman collapse

Despite constant talk of the credit crunch in 2008, the real impact of any downturn is not going to be felt until 2009, according to Computacenter's chief executive Mike Norris.

Speaking in his keynote at the inaugural CRN Reseller Leadership Forum event at the Four Seasons Hotel in Hampshire today, Norris also hinted that the services and infrastructure giant will be making redundancies over the coming year.

"2009 is going to be tough. I think 2008 is a good year. I am expecting it to get worse in 2009, particularly for the IT market. I hope I'm wrong. We at Computacenter continually try and drive costs out of the business, and I am expecting our headcount to reduce."

Other issues touched on in his keynote included the recent rise in product prices - initially lead by HP but closely followed by Acer and most recently Dell. Also the fact that the PC market will be dominated by Asian manufacturers as the US firms focus more on the high end space. He also hinted that outsourcing is shrinking in popularity with a growing "anti-outsourcing" mindset emerging.

Norris also admitted that Computacenter had taken quite a large uninsured hit when Lehman Brothers went down last week. The Lehman Brothers business was worth £15m a year to Computacenter.

"It was a painful day and I don't expect to see any of the money that they owe us," Norris said.

However, he also offered some words of advice to his peers. The main wish of most channel customers, Norris said, is to keep their jobs.

"It is not about changing a business or business redesign anymore. There are a lot of scared customers out there who just want to keep their jobs," he said. "The focus has to be where we can add value and also help take the cost out of business. It can appear a bit boring, but our customers want heroes that can help them keep costs down.

"The industry will consolidate further," he added. "Particularly of very large global companies that are going more upmarket. This in turn creates space for us [the channel] in the 2,000 to 15,000 employee space. Customers with 5,000 to 10,000 seats don't want to deal with those larger players. They want to deal with people that they can look into their eyes and see that their business means something to them. Therefore global mergers create space and opportunity for us all to step up into. I still have enormous optimism in the marketplace."