Computacenter reorganises business units

Corporate VAR shifts focus further to products and services divisions

Just days after it issued a profit warning Computacenter (CC), has announced a reorganisation, with the focus on new products and services divisions (CRN, 4 July).

Unveiling the plan at an investor presentation last week, CC said the changes will allow it to report on the services and products divisions separately.

The corporate VAR admitted that the contribution of the product side of the business was down by £32m in 2005, partly because of senior management focusing on growing the services business.

George O’Connor, technology analyst at Shore Capital, who was at the investor presentation, told CRN: “The new organisational model will involve CC shifting focus from customer and vertical units towards technology units. The move is geared to creating more separation between services and product lines (CRN, 9 May).

“CC also announced a new selling model that will provide a lighter touch than the heavy-handed approach it has been using.

“CC is a good sales firm. Many of its top executives are sales people. It has a good sales model, but I am concerned that this may alienate customers who like to see propositions that address their needs.''

“The new overall model could improve underlying profitability as it will create more transparency.”

Eric Thickett, founder and chief executive of systems integrator MiTech, said: “CC’s reliance on product margins is not appropriate for CC, MiTech or any IT company. Customers are looking for immediate business benefits or they are not buying, and vendors are looking for repetitive revenues, or they are not surviving. You can’t do this by being dictated to by suppliers and partners.

“CC needs to break free from restrictive vendor contracts and offer its customers the best solution for the business challenge they are facing.”

CC declined to comment.