Presidio Pumps Itself Up
Robert Murphy, Northeast divisional co-president at Presidio Networked Solutions, recently spoke with senior editor Jennifer Bosavage on the merger that catapulted $216 million (2005 revenue) Presidio Networked Solutions into the mega-VAR realm.
VARBusiness: What do you think was the main impetus for Presidio's growth?
Murphy: Those numbers were driven by acquisitions last year. The company as a whole, when you combine it, has shown 17 percent growth overall. The growth is still aggressive. Unified communications played a big role. Cisco refers to unified communications as a 40 percent growth area, for example. Teleconferencing, from a revenue perspective, has had a lot to do with our growth. We carry Cisco, Polycom and Tandberg. But Cisco's TelePresence is bringing visibility to teleconferencing. We've seen a great benefit from Cisco's entry into the market. It's helping our overall proposition, which is focused on convergence.
Other areas giving us revenue opportunities include security and storage. Storage revenue is almost up 90 percent in the Northeast. Government regulations are causing some of that growth in storage. The space lit up mainly in the end of 2006. We're seeing growth in many areas, especially in legal.
VB: In terms of upgrading storage and security, how do you get customers to do what they ought to?
Murphy: Persuasion needs to come from the threat of what the real risk is in not doing it. Everyone talks about security, for example, but only in the financial markets were the penalties real. Now, companies are starting to see penalties. We've bridged the gap between legal realities and the IT reality of where companies are today. We're bringing C-level people into the discussion. The IT departments in midmarket companies want this to be done, and they applaud it.
VB: What are some of the challenges that have been part of the company's huge organizational change?
Murphy: Our challenges are not that unusual for any growing VAR. [They] are growth, profitability and staffing. The supply of qualified employees continues to not meet the demand. So we're working harder at building organic training programs. Profitability is always a challenge. We are always trying to find the right blend with services. It's a constant turning of the 'radio knobs.'
VB: What are your plans in terms of consolidation?
Murphy: Our strategy was not to smoosh everything together to lower cost. In fact, it's the opposite: We recognize how these companies became successful, why they are part of the merger, and we are trying to make sure we maintain leadership roles. We've taken advantage of some best practices, for example, in approaches to project management, billing. We viewed these as opportunities toward improving the quality of life for our employees. We're not trying to shove a discrete manufacturer's P&L [profit and loss] into our business.
VB: And the employees' take, from your point of view?
Murphy: We've been very up-front with our employees. We've had no turnover associated with this integration over the past two-and-a-half years. Making sure there is a synergy between the companies is key to achieving growth.