After Historic Downturn, The Industry Looks Ahead to a Rebound2:20 PM EST Mon. Nov. 05, 2001
espite the economic downturn, Hoffman Technologies Inc. (HTI) has never been so busy. Seems everyone in the nearby California State government, where HTI does 60 percent of its sales, wants to throw the IBM midrange-systems supplier some business.
One reason, no doubt, is because the Roseville, Calif.-based IBM Business Partner is known as a Disabled Veteran Business Enterprise (DVBE), which appeals to many patriotic-minded customers these days. A bigger reason, however, is because of the company's proven track record in IBM solutions delivery, says Kevin Hoffman, vice president of sales at HTI.
"Given that several of our guys are veterans, you can only imagine how motivated we are to deliver our best at a time when the mood of the country is on edge," Hoffman says.
Try as they might, however, not everyone is in a position to put on such a brave face. In fact, the mood is downbeat in certain parts of the IT economy, where layoffs mount and losses grow. Sun CEO Ed Zander believes the aftershock of Sept. 11 won't fade quickly. The terrorists "put a dent in the economy that will be felt for a very long time," he says. But others feel differently. Mike Long, president of the North American Computer Products division at Arrow Inc., one of the world's largest distributors, says, "Sept. 11 has little or no impact on our long-term view."
Gauging the mood of the industry has rarely been so challenging. But it is of paramount importance to solution providers to better understand buying habits and spending priorities at this historic moment. How else, after all, could solution providers possibly staff their companies, gamble on new technologies or even borrow money with any degree of confidence?
To get a better sense of the current climate, VARBusiness turned to Zander and other industry luminaries, including Hewlett-Packard CEO Carly Fiorina. We looked to key decision-makers in distribution, including the heads of Tech Data, Arrow, Ingram, GE Access and MOCA. We also conferred with many VARs and IT consultants who buy products from those suppliers. Finally, we analyzed numerous research reports completed after Sept. 11, and conducted exclusive research. Our information suggests that the mood of the IT economy is divided, but not by those who think times are good and those who think times are bad. Rather, it's divided between those who have a plan for getting out of this mess and those who see no way clear.