AFT lays foundations for growth

After a year in which it claims to have doubled its growth and reinforced key vendor partnerships, Al-Futtaim Technologies is hoping 2008 will deliver more of the same. In a new section of Channel Middle East designed to outline the opportunities and challenges facing some of the region's leading resellers, Al-Futtaim lays bare its plans for expansion.

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By  Andrew Seymour Published  January 15, 2008

Rising oil and gas prices have naturally led to Gulf countries investing heavily in IT systems and enterprise resource planning (ERP) solutions.

As an enterprise reseller of some of the largest names in technology and applications, UAE-based Al-Futtaim Technologies has benefited from the market boom.

But if it is to reach its growth objectives this year, then it is going to have to pave its own path through the challenges that the market is set to present.

Harvey Klyce, brought in as managing director last year, believes companies that want to survive in the enterprise reselling space must assess whether their selling tactics fit the market they are addressing. "I would call the Middle East market a market of change, traditionally it has always been very much about relationships where you see people who have been here for many years, among families and other types of relationships, and they wanted people they knew," he explained.

"That market is evolving. That tradition hasn't gone away, but a lot of multinationals are now moving in so there is a lot of business and a lot of activity. We have invested in a marketing group, as well as investing in internal processes to drive the demand," he revealed.

One potential issue that could cause Al-Futtaim problems over the coming months if it goes unchecked is staffing. "There is currently a shortage of people," proclaimed Venkatesh Margabandhu, product group manager at the reseller. "New companies are coming in and we have a whole set of local companies who are upgrading and improving on their processes. That is ramping up faster than the people and their skillsets flowing into this country. So we are caught in a phase of it being very difficult to recruit and retain talented people."

At Al-Futtaim Technologies, an emphasis is placed on working hard to keep the people it has already, according to Klyce. "People to me directly translate to money. The more people you have, the more money that you can make. The challenge is to find people who allow you to make money when you bring them in, because if you get someone to change jobs you have to pay them a premium," he said. "That is why our internal training programme works well. If you train your own people then it's good for them and if they work for you for three or four years, suddenly their market value goes up dramatically."

Another challenge that Al-Futtaim has to rise to in order to retain its market share is the fight to stay competitive in an already overly-served arena.

As an enterprise-focused reseller it naturally invests time and money in understanding and answering the needs of the end-user. Klyce however, also reveals that Al-Futtaim is looking to the production of its own products as a way of moving forward in 2008. "I firmly believe there will be a shift towards companies developing their own intellectual properties, as opposed to trading others'," he said. "Companies like ours will go and get a product of their own, invest in it, take it to market regionally and not just add value on somebody else's product," he predicted.

Al-Futtaim also plans to look to different horizons in the region as part of its expansion plans this year. The company claims it is reaping the rewards of recent investments in Pakistan, where it created a similar business model to the UAE.

Klyce and Margabandhu also express an interest in taking Al-Futtaim's vendor partners into other markets, with Saudi Arabia currently a top regional focus due to the level of growth exhibited. "Abu Dhabi is going to see a huge increase in investment, Qatar also, and Bahrain and North Africa," he added.

Al-Futtaim Tech

Headcount: 220

Vendor partners: Microsoft, TCS, Alcatel-Lucent, Nexans, MobiApps

Market focus: Owned by the Al-Futtaim Group, AFT sells mainly to the SMB and enterprise segments. Its key markets of expertise include real estate, healthcare, hospitality and contact centres. Core competencies include VoIP, networking and ERP solutions.


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