A Simple business strategy
IT company Simple plans to use a lower price strategy and new products to more acutely target its financially struggling client base of small to medium-sized enterprises. The initiative is the result of a pessimistic view of the IT sector this year and the need to stay competitive.
"We had to change our price strategy," said Wojciech Popowski, president of Simple. "The recession resulted in the cutting down of investments in the SME sector."
In addition, he explained that the economy has forced the company to also reinvent its business model.
"(It) has induced us to reduce activities which were less profitable," he said. "We changed our business model, reducing, for example, the service of hardware delivery in some of our selling points. We reconstructed our company; we changed our model of organisation."
Popowski said the changes lifted a financial burden off the Warsaw Stock Exchange-listed company, which will allow it to better serve SMEs.
"That reduced the costs and allowed us to concentrate on our core business, which is to deliver the solutions for effective support of management processes," he said.
Based on this outlook, especially given the slow-paced SME sector, Simple has estimated that it will yield Ebitda - a key measure of profitability - of E608,000 in 2003.
The company sells enterprise resource planning (ERP) software, installs technology and offers IT consulting services and training. It recently launched Simple - System V, a new software platform tailored specifically for SMEs.
"The chances for increasing the turnover of IT companies, including Simple, are not very big," Popowski said. "I do not think that the macroeconomic situation could positively affect the situation on the IT market."
Popowski lays part of the blame for the economic difficulties - and the dismal climate in the IT sector - on the government.
"The present and the former government affected the economic situation in Poland negatively," he said. "The government could do much more to improve the situation, and it doesn't do it."
Popowski expanded on the financial mishaps at the hands of politicians.
"In the mass media there are a lot of discussions about corruption, but it is not the most important issue," he said. "The most important thing that should be improved is the tax system in Poland. A good tax system should stimulate both investment and demand on goods."
Indeed, Popowski added that political wrangling over the independence of the Monetary Policy Council puts a direct strain on Simple and its competitors.
"All in all, this kind of politics cannot stimulate the economic growth," he said.
The company continues on, nonetheless, Popowski said.
"The IT market is tough at the moment," he said. "Our company is a provider of investment goods and in times of recession our potential buyers are cutting back."
"We had to change our price strategy," said Wojciech Popowski, president of Simple. "The recession resulted in the cutting down of investments in the SME sector."
In addition, he explained that the economy has forced the company to also reinvent its business model.
"(It) has induced us to reduce activities which were less profitable," he said. "We changed our business model, reducing, for example, the service of hardware delivery in some of our selling points. We reconstructed our company; we changed our model of organisation."
Popowski said the changes lifted a financial burden off the Warsaw Stock Exchange-listed company, which will allow it to better serve SMEs.
"That reduced the costs and allowed us to concentrate on our core business, which is to deliver the solutions for effective support of management processes," he said.
Based on this outlook, especially given the slow-paced SME sector, Simple has estimated that it will yield Ebitda - a key measure of profitability - of E608,000 in 2003.
The company sells enterprise resource planning (ERP) software, installs technology and offers IT consulting services and training. It recently launched Simple - System V, a new software platform tailored specifically for SMEs.
"The chances for increasing the turnover of IT companies, including Simple, are not very big," Popowski said. "I do not think that the macroeconomic situation could positively affect the situation on the IT market."
Popowski lays part of the blame for the economic difficulties - and the dismal climate in the IT sector - on the government.
"The present and the former government affected the economic situation in Poland negatively," he said. "The government could do much more to improve the situation, and it doesn't do it."
Popowski expanded on the financial mishaps at the hands of politicians.
"In the mass media there are a lot of discussions about corruption, but it is not the most important issue," he said. "The most important thing that should be improved is the tax system in Poland. A good tax system should stimulate both investment and demand on goods."
Indeed, Popowski added that political wrangling over the independence of the Monetary Policy Council puts a direct strain on Simple and its competitors.
"All in all, this kind of politics cannot stimulate the economic growth," he said.
The company continues on, nonetheless, Popowski said.
"The IT market is tough at the moment," he said. "Our company is a provider of investment goods and in times of recession our potential buyers are cutting back."
