Sirius CEO Says Mainframe SP Acquisition Completes IBM Portfolio

Harvey Najim, president and CEO of Sirius Computer Solutions, IBM's largest North American solution provider, discussed Sirius' recent acquisition of IBM mainframe solution provider Denver Solutions Group (DSG) in an interview with CRN Industry Editor Craig Zarley. Here is an excerpt:

CRN: What did Sirius gain from the Denver Solutions Group acquisition?

NAJIM: If you look at the products that we sell, we had four of the five [IBM server lines]. We really wanted to complete and represent the entire [IBM] eServer brand to our prospects and customers. This gave us the opportunity to do that. There are many large customers that not only have zSeries [mainframes], but they also have midrange. We may control the account in the midrange, but another [IBM] Business Partner may control that account on the zSeries. We thought it would be better for us to become a total eServer solution provider so we could offer the customer anything from the xSeries all the way up to the zSeries.

CRN: What is the opportunity for IBM Business Partners in the zSeries mainframe market?

NAJIM: Any solution provider that's marketing iSeries, pSeries and xSeries has problems with margins, because there are tons of partners marketing those [systems]. There are 12 partners in North America that market the zSeries. Being one out of 12 is better than being one out of 480. I wanted Sirius to become a total eServer solution provider. When I put together the growth strategy for this company, I thought it was important to get into the zSeries business.

CRN: How is Sirius' IBM eServer business going this year?

NAJIM: This year, through April, our pSeries [sales are] up 171 percent over last year. This year my storage business is up 94 percent over last year. My xSeries business is up 186 percent over last year. I wanted to make sure that Sirius wasn't dependent on any eServer platform for its growth and stability. With the DSG acquisition, we are No. 2 in storage and No. 1 in the world in iSeries. We are in the top three to five in xSeries. We are No. 2 in zSeries. Our projected pro forma revenue this year is more than $550 million.

CRN: Does Sirius plan to make other acquisitions?

NAJIM: Sirius acquired Symatrix Technology on Oct.1, 2002. That gave us a presence in the Pacific Northwest. We picked up a nice Houston company, Strategic Systems, in November 2002. The business growth strategy that I have put together with my partner Joe Merten is a platform within geography strategy. What we did is profile what Sirius looked like [in terms of] platform within the East, Central and West geographies compared with IBM--where are the differences, where are the holes. We fixed the hole in the Pacific Northwest. We still have some gaps in the business growth strategy. Last summer, we picked up the remnants of a company called Think Tank, which strengthened our pSeries, storage and high-end xSeries on the West Coast. Late last fall, we picked up the remnants of a company called Impact, which gave us some iSeries and pSeries folks in the Southeast and Northeast. I don't think it would be to our benefit to pick up another zSeries solution provider. However, where I do see we might have some gaps in our business growth strategy is in the Northeast and Southeast with respect to the pSeries and xSeries. We've made some management changes in both of those geographies that will bring some tremendous skills in open systems and xSeries and high-end storage. However, if the right opportunity comes along, we will definitely jump on it.

CRN: Has Sirius considered adding hardware vendors other than IBM to grow its business?

NAJIM: The reason that at the present time we have chosen not to have an alliance with any other hardware vendor is because we feel that IBM has the best products and best solutions for the customer. We have chosen to keep all of our marbles in the IBM basket. But there is another piece to this, and that's other strategic alliances. We have an alliance with SAP. We have an alliance with SSA Global. We have an alliance with PeopleSoft, Lawson and Lakeview Technology. And all of these alliances help us sell one heck of a lot of IBM hardware. Our strategic alliances, in addition to IBM, center on the ISV.