Change or die. Why the future of system integrators strongly differs from their past
All happy families are similar at each other, each unhappy family is unhappy in own way, Leo Tolstoy wrote. All successful system integrators resembled too – they became Microsoft partners, SAP, Oracle, IBM, Cisco, earned from deliveries and projects a good margin which with interest covered all risks arising on the growing emerging market. But the market matured and changed, and integrators began to fall – everyone in own way.
Looking at the list of the largest players of IT market of Russia of ten-year prescription and comparing it to the similar list of the companies based on 2017 it is possible to notice loss of a number of integrators which as it seemed then, in full zero, located in the market seriously and for a long time.
R-Style, Verysell, Microtest, Optima, Nienschanz, EcoProg, Armada, Stins Coman, Forecast - they are absent or any more at all, or is not present among noticeable players. In 2018 we will follow to the grave some more companies from among those who are considered to be market leaders.
Basic reasons of crash of integrators if to judge by experience of last years:
- A discord between co-owners
- Loss of the biggest customer
- Problems with the law
- Failure with entry into other market
- Errors are quits business continuity models
- Death of the leader-founder
Not each of stories of the left companies is studied and opened rather deeply therefore we will unambiguously not put names opposite to the specific reasons. But we can claim with high degree of confidence that the following integrator will leave the market on one or a combination them.
Integrators can hurt different diseases, but a platitude, as a rule, is their weak immunity – low stability of business and unavailability to endure strong shocks.
The situation is complicated by the objective changes happening in the market:
- large foreign vendors aim to work with customers directly
- telecom and the Internet companies (MTS, VimpelCom, MegaFon, "Yandex", Mail.ru) begin to render IT services based on own data centers
- state corporations receive the statuses of the only contractors on the largest IT projects, keeping a considerable part of a margin
- big customers became more experienced ("Before sale in IT sometimes reminded attempts to sell the book to the people who are not able to read. Now are able to read and already understand that the book is necessary", [1] the founder Lanita Georgy Gens said in the last interview TAdviser) that led not only to increase in demand for IT services, but also to development of insourcing unpleasant to system integrators
What is undertaken by integrators for strengthening of the immunity? They transform the business models.
Croc and Softline advance the managed services with payment after delivery of consumption, ITG and IT invest in development of own software products, IBS in addition to software offers customers and own (together with Depo) hardware solutions. All aim to increase marginality, to diversify an order portfolio, to increase replicability of solutions or services.
Try not to miss integrators and demand for so-called blasting technologies – Jet Infosystems and IT save examination on artificial intelligence, Lanit and Croc - on a blockchain, IBS and I-Teco – on Internet of Things.
Will not refuse to deliver to the client expensive American "iron" none of the largest integrators, probably, yet, but hardly someone from them will tell that this activity is the cornerstone of their present business model.
The marginality of infrastructure projects decreased, and the competition grew – now similar services quite mid-size companies can do.
Of course, there are megaprojects unavailable to average players. But the example of Technoserv shows that to do business which cornerstone infrastructure megaprojects are it is possible only in the presence of the large financial partner. Only the problem in that, as financial partners becomes less.
Having lost support of Promsvyazbank the integrator was forced to look for urgently the new satellite, and could find it on behalf of the state VTB only in exchange for 40% of business.
Transformation is the condition necessary for survival, but not sufficient for further development of integrators. And here large players of the market show different approaches again.
IBS, IT and Softline are going to become public and to place the shares on the exchange. It will allow not only to attract money for development, but also will simplify access to the credits in the future.
I-Teco and ITG go some other way so far – through joint ventures with the state corporations (with Sberbank and Rostelecom, respectively). Their administrative resource and financial stability is without what it is harder and harder to get access to the new markets opening according to state programs.
We will not undertake to predict who will remain at top of rating of the largest IT companies in 10 years, but we can predict a set of characteristics which the most part of these companies will have to have.
- At the heart of a business model - own products or the managed services
- There is no dependence on one client
- There is no dependence on one partner vendor
- There is no dependence on one leader-owner
- There is a shareholder or the joint venture with state participation
What successful integrators will be tomorrow strongly differs from what they were still yesterday.
The author - the Chief Editor of TAdviser Alexander Levashov
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