Morse is nearing the first anniversary of its major corporate rebranding exercise and is feeling extremely bullish for the coming year.
The integrator announced its transformation into a unified services company last year. The previous year it had split into two separate operating divisions: Morse Consulting, which incorporated Diagonal and other acquisitions; and Monitise Group, its secure mobile banking applications business.
Last year, Morse spun off Monitise and hinted there could be more spin-offs to come this year. Morse also added to its consultancy strength with the acquisition of Xayce. The move built upon its offerings in the insurance and retail banking services space.
Speaking to CRN, Peter Critchley, marketing director at the integrator said the firm had a carefully constructed plan of action.
“We are very much in implementation mode now. We have done the strategy bit and now we are at the execution stage,” he said. “We are not the same business that we were four years ago.
“A lot of what we are doing at the moment is taking our basic model and fleshing it out with the right skills and capabilities. We are focusing more on professional services right through to high-end consulting, rather than pure infrastructure.”
Critchley said the firm is working hard to shape its skills around key verticals, such as the financial services sector and the media communications space. It is also pushing ahead in the commercial market ­ particularly in retail, and content management and human resources issues.
However, Morse is seeing real traction in the public sector ­ particularly with the Building Schools
for the Future (BSF) initiative, which will see every secondary school in
the UK rebuilt or revamped to a common standard of IT and building specification.
Critchley said Morse had no real track record in the education space before BSF, but had quickly tailored its strategy to start competing for the lucrative contracts.

Picking up on potential
“We wanted to pick areas where we felt we could take our skills and specialisations to the market. The government is putting a lot of money into rebuilding schools. We can add expertise to the public sector and really focus our skills on the BSF agenda. Every local education authority is a potential contract ­ the differentiation in bids tends to be the IT component,” said Critchley.
A representative from Partnerships for Schools, the agency delivering the BSF programme, agreed IT was a crucial part of the strategy.
“IT is an integral component of BSF and with a high level of capital funding it will bring about a step change in the level of IT provision across the entire secondary schools estate in England.
“New IT-rich schools will also offer more opportunities to provide students and staff with training
or links with other organisations ­ which might otherwise be off limits ­ through virtual schools and to open up IT use to the community as a whole.”
Morse recently won its first BSF contract with South Tyneside and Gateshead LEA in partnership with building construction giants Stagg and Carillion. The contract is worth £23m to Morse over the next five years and it has an option to extend the contract for a further five years.
“It is really important that we build the right relationships with companies [such as Stagg and Carillion] because we are going to have to work very closely with them over BSF,” Critchley added.

Following steady revenue
He said BSF was particularly beneficial because it means a steady revenue stream. “BSF is a big project. It is also a recurring revenue model. We know what is required and then we will have a services-based business model.”
Critchley said Morse has about £200m worth of potential BSF contracts in the pipeline and is down to the shortlist stage in Tyneside and Durham.
Looking forward, Critchley agreed times will get leaner for the channel.
“It is easy to talk ourselves into a crisis at times. I think we will be in for tougher times, but in general for IT suppliers it depends on the skills and knowledge they have. I agree there will be a shakeout of any channel players that remain resistant to market change.”
In the current climate, consolidators are seizing the opportunity to acquire complementary companies, and Critchley said Morse is not ruling out future acquisitions.
“We have done plenty of acquisitive growth as well as organic growth, but a lot of it has been a cultural fit. The great thing about our Xayce purchase was that it was a very successful business, but the company recognised it wanted to be part of a larger organisation.
“Our future [acquisition] strategy is all about people, skills and the client base rather than acquiring a business for the sake of it,” he said.
Morse completes its corporate rebranding