Software AG takes aim at SA market

Johannesburg, 26 Apr 2004

Software AG, the German software vendor, has decided to take back responsibility for its customer base in South Africa and step up its presence in the local market, which it believes is worth as much as 10 million euros per annum.

This follows Software AG's decision not to renew the local distribution and maintenance contract with Dimension Data for its Adabas/Natural product stream.

"Having decided not to renew our contract with DiData, we are in the process of disengaging in a controlled and proper manner," says Mark Edwards, senior vice president and executive board member at the company.

"Software AG has around 100 clients in SA, including major banks like Standard and Absa, as well as entities like SITA and SARS. These organisations run our products in mission-critical environments, so we need to provide top quality service to them."

He says that they reached an agreement with DiData whereby the members of the team looking after the Software AG products' business unit were brought under their control, meaning that the entire team is now officially part of Software AG SA.

"We still have a very good relationship with DiData, as can be seen by the fact that we've taken an extended lease on premises at The Campus. This is also useful to us, since it means that the people who came over from DiData remain in the same working environment," says Edwards.

"We will also be bringing in a country manager who will be a local player. I definitely want someone who will understand the SA market and the local challenges, like BEE."

"We are hoping to make this appointment in the next three months, but we don't believe in rushing into it as it is a key position and thus a very important decision."

He says that since the organisation currently does not have a professional services arm in SA, they are looking to acquire a small local business, to complement what the company does in terms of professional services.

"It will have to be a company no bigger than our current one - meaning we should double in size - and ideally we would like it to be a BEE company, in order to best fulfil those requirements," he says.

"BEE is an issue that is taken very seriously by Software AG and it will certainly be discussed at board level. We already have a number of things in the pipeline in this regard."

Asked about a possible expansion into the rest of Africa, Edward says that looking into opportunities across the continent will be part of the remit of the country manager, although the key focus is to establish SA as a strong base, before looking at the rest of Africa.

"We need to get our name out there in the SA market initially. In every market there is a local network and if you want to succeed, you need to become part of that network," states Edwards.