Dimension Data company Britehouse was formed several months ago in an attempt to maximise the growth taking shape in the business software applications marketplace. Working under the Britehouse name are software application specialists Pebbletree Consulting and 3fifteen, JSE-listed ICT resourcing and solutions company Paracon Holdings, and automotive dealership software management firm AutoMate. Britehouse holds a 30 percent stake in Paracon. Founded in 1983, Dimension Data started as an infrastructure business but then made an attempt to move into the software business in the late 1990s through a variety of companies, including the now defunct division called iCommerce. With the IT market crash in 2000, Dimension Data realised that being all things to all people didn’t work. Trying to be a big player, the company unsuccessfully
offered competencies ranging from Oracle and SAP to Software AG solutions. Retrenchments followed in the software space and Dimension Data was forced to focus on its core infrastructure and network businesses.
Since then, there have been a number of changes in the ICT environment in that the network (with the convergence of voice and data) has become more important to business. Dimension Data had retained a number of niche software businesses, including Pebbletree Consulting, 3fifteen and AutoMate. Pebbletree Consulting is an SAP Africa service partner and SME business partner that provides SAP business consulting services. 3fifteen is a Microsoft Gold Partner that provides specialist Microsoft services including consulting, software application development and deployment – not to be confused with Dimension Data’s own Microsoft licensing and infrastructure business. Paracon has been included in the mix to provide a flexible skills base from which to deliver integrated services and solutions. AutoMate, on the other hand, provides computerised management services to more than 800 automotive dealerships and is jointly owned by Dimension Data, MIP Holdings and management.
“We have these pockets of software assets that we felt we wanted to house separately for a number of reasons,” says Britehouse CEO Scott Gibson.
“Firstly, our strategy is slightly different to an infrastructure strategy. Secondly, the businesses were sitting under Protocol, which was Dimension Data’s venture capital operation, and were, therefore, not part of the BEE deal concluded in 2004. They needed BEE ownership,” he says. At the time of writing, Britehouse was in the process of selling 60 percent of the company – pending Competition Commission approval – to “a special purpose vehicle that has as its partners and investors VenFin, Safika and Convergence Partners”. Convergence Partners is the renamed entity previously known as Ngcaba Holdings owned by Dimension Data SA chairman Andile Ngcaba.
Under one umbrella
Having brought the various businesses together under the Britehouse name, Gibson’s role as CEO of Britehouse is to provide
customers with a service that is all-encompassing.
“We have an SAP business, a Microsoft applications business and the AutoMate operation that sits on its own and is very specialised. There may be an opportunity for us to integrate that business with the SAP dealership OEMs, which means that we may be able to integrate SAP with the dealer management system. And then we have Paracon, with its pool of resources. The result is that there is a lot of opportunity for us to work together. “This makes us a very big player in the software applications space. If you add up the revenues of all the companies, you have in excess of R1 billion, with Paracon as the largest contributor to that. We have more than 2 500 skilled employees in this resource base. In an environment where the skills shortage is such an issue, we are able to differentiate ourselves,” he says. Gibson’s strategy is to ensure that the teams that operate under the Britehouse banner all work together as a single entity. The company recently signed a deal with travel firm Tourvest in which Britehouse has developed a system to manage in-flight duty free purchases on SAA flights.
“I’m trying to promote the fact that [the Britehouse companies] all work together and want to be able to grow into the public sector, which is a big market for applications. I think that with the various offerings that we have, being BEE empowered and with local skills to offer, we have a good offering for the public sector.”
In order to become a dominant player in the public sector, Gibson reveals that Britehouse is looking to make acquisitions over time.
Past successes
Previously the managing director of Conscripti, a joint venture between Dimension Data and Tata Consultancy Services (TCS), Gibson proved his mettle by turning South Africa into a destination of choice for Tata consultants. He helped change the perception that the country was a crime capital, with poor infrastructure and limited resources.
“With 80 000 people employed by TCS, the company ships its consultants all over the world, mostly to Europe where it’s easy to live. We had to make it attractive for people to come to South Africa. By managing the process of encouraging Tata consultants to work in South Africa a little better, we achieved our goal.
“That was a small part of the process. The other element was that I came from Dimension Data, which meant I was able to leverage the company’s sales force, probably better than what we had in the past at Conscripti.”
Gibson had been at Dimension Data for five years as the chief financial officer of operations for the Dimension Data Group before heading up Conscripti. He worked for Malcolm Rutherford, the previous financial director of Dimension Data. “I was his lackey,” Gibson quips.
Under Gibson’s leadership, Conscripti’s revenues grew by 43 percent in the past fiscal year. He attributes his success to an ability to use the Dimension Data sales force to introduce the TCS offering into the local market.
Gibson is attempting to achieve similar goals with Britehouse by introducing Pebbletree and 3fifteen to the Dimension Data sales team, therein leveraging that capability.
“The growth [of Conscripti] cannot be attributed to me,” he points out. “I think the market is clearly changing as applications and networks overlap. It became more relevant to the Dimension Data team to talk to their customers about the applications space. In the past, customers were divorcing the two. Now, the conversations we are having with CEOs and CIOs involve both the applications space and infrastructure space.”
A natural leader
A chartered accountant by profession, it was while heading up Conscripti that Gibson realised that he no longer wanted to continue in the finance field.
“I am the kind of person who likes to get things done, am very interested in execution and getting people to work together. When I joined Conscripti, staff morale was low and people weren’t sure about the relationship between Tata and Dimension
Data. At that time, I played a lot of arbitration roles and was often called into meetings to resolve issues. And this is where I think my skill lies – in the ability to get people to work together and work towards achieving a goal.”
Gibson finds himself in a similar position at Britehouse, where he manages a team of leaders “with very strong personalities” heading up their own companies: Mark Jurgens of Paracon, Paolo Masselli of Pebbletree, James Baber at 3fifteen and Mike Botha at AutoMate.
“What I am really trying to do here is get the four leaders of these companies to work together,” he says. “What keeps me awake at night is that there is so much opportunity in the South African market, including Africa. I just don’t want us to lose out anywhere.”
Gibson lists a number of goals that he aims to achieve in the next few months at Britehouse. And while the bottom line is important to the business, he points out that it’s more about growing the business, hiring the right people, becoming a well-known brand in the local applications space and achieving success in the public sector.
“The numbers are how you measure your success, but it’s not all about the bottom line,” he adds. “Britehouse will always be part of the Dimension Data family and we will always try to work together. But ultimately we want the Britehouse brand to be recognised and we may eventually be a company all on our own, with Dimension Data as a minority shareholder – we are still having discussions around this.”
In the end, the Britehouse name comprises four healthy brand names, including 3fifteen, AutoMate, Paracon and Pebbletree. Over time, the company may seek to integrate these brands under the singular Britehouse name, but with Paracon as a strong brand in its own right, this may be wishful thinking.
itweb brainstorm July 2007 Written by Graeme Scala