Enterasys Networks has opted for what it says is a unique business model and marketplace strategy tailored to the South African market that has seen the company grow significantly at a time when its competitors are caught in the turbulence of the global IT downturn.
Reacting to reports of staff layoffs, downsizing and restructuring in the local IT industry - particularly the networking sector - Martin May, Enterasys Networks regional director (sub-Saharan Africa) says he believes Enterasys has arrived at the right recipe for success in SA.
"Despite the downturn in the tech stock market, Enterasys has grown its revenues by 40% in SA in the last 12 months. During this time major players in the networking market - including 3Com Corp, Nortel Networks, Cisco, Lucent, Marconi and others - have reported significant losses and have retrenched employees to the point where many are being run by a skeleton staff."
May says many global companies were bound to be negatively influenced by the global downturn as they are largely funded from global resources and controlled by international management strategies that have little regard for the nuances of the South African environment.
"The South African market represents less that 2% of the global market, so it is unrealistic to implement global decisions - which are based on quarter-on-quarter results - on such fundamental business aspects as marketing, staffing and technical support in SA.
"As soon as the international marketplace slows, the impact on SA is immediate and disproportionate to the requirements of the local market which needs to be assured of certain levels of service and support," he says.
"By contrast, at Enterasys, we have realised that we need to operate with a degree of autonomy from our global parent to succeed in this market. Our South African business model has seen us form a strategic alliance with Duxbury Networking, our key distributor, in order to cut operational expenditure and broaden our foot print in the region.
"As a result, we have been able to maintain - and increase - our staffing levels where necessary to meet local demand. Unlike some of our competitors, we have not decimated the sales, technical support and marketing operations, or restricted our geographical coverage.
"On the contrary, Enterasys is currently placing increased emphasis in these areas. We are also looking to increase our role as a `good citizen` in SA in a bid to demonstrate our commitment to the country.
"To this extent, we are poised to donate more than $5 million in computer equipment to the Nelson Mandela Children`s Fund to equip underprivileged schools with local area networks.
"Significantly, Enterasys has earmarked $5 million for the South African `LanCare` initiative which is a technical backup and replacement parts holding service involving guaranteed product replacement for Enterasys customers in support of their mission-critical systems. Additionally, Enterasys has a $50 million fund ready for investment in companies which will play a role in our future in SA."
May says further evidence of Enterasys`s support for the local market is the hosting of the Enterasys e-Net Conference in Johannesburg in August 2002, which will bring many delegates and speakers from overseas.
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