Late entrant predicts 100 percent growth
By Timothy Sifert
A latecomer to the local IT industry, Compuware, expects to double its revenues in the country over the next year, on the heels of opening its first Polish office. As one of the largest software companies in the world, Nasdaq-listed Compuware's strategy to officially open its doors to Poland last week makes it one of the few industry heavyweights that did not already have professionals on the ground in the country. Its recent decision reflects the need for all IT companies to become more ingrained in the country, in order to win the bigger contracts as the competition heats up.
"We are quite late," says Franz Fuchsberger, Compuware managing director for Austria and Eastern Europe. "We've been doing business on a fly-in-fly-out basis."
He explains that, recently, customers won by Compuware over the past few years have started to need closer contact with the company. And to become more embedded in the country's IT industry the firm needs people on the ground here. "If we want our business to grow, we need to be here," he says. That's an assumption many competitors have acted upon earlier than Compuware.
Nevertheless, via its Austrian office, the company has been able to procure an A-list of customers, which it plans to build on, Fuchsberger says. Through partner companies EuroCIM, SPIN and PB Polsoft, Compuware has, over roughly seven years in the market, been able to secure PKO BP, BRE Bank, the Ministry of Finance and Prokom as customers, among others.
Last year's new software license provided E1 million in revenue in 2002, Fuchsberger says. That does not include maintenance of existing clients or other revenues from professional services, he adds. In the past, the company has been more present in the Czech Republic and Slovakia, though globally, Compuware has $1.3 billion in annual turnover in 54 countries.
Poland is an important market today, owing to European Union integration - the most common impetus behind new market entrants - as well as the fact that many local businesses are snapping up new software at a faster clip than in neighboring countries.
"What makes it interesting is we believe it has amazing potential," Fuchsberger says. He adds that the country is undergoing a 'software wave.' As countries or regions advance technologically, local companies and institutions binge on hardware in a 'hardware wave,' which is followed by a comparable buying spree of software, he explains. This part of the cycle is ideal for companies like Compuware.
"There was a big hardware wave over the last seven years," he says. "Now we've started a software wave."
Most of Compuware's business will be conducted through partners rather than direct sales, though it is looking to add sales staff in the country. "We are mainly going to do business via our partners," Fuchsberger says. Compuware has taken this tack in the past - and plans to continue it - because it is the easiest way to break into the emerging markets of central Europe.
