Logicalis South Africa - Nov 2019

LO G I CA L I S

CEO FRIKKIE GROBLER

LOGICALIS SOUTH AFRICA

Not Just IT Solutions but

Global IT Know-how PRODUCTION: Karl Pietersen

Logicalis South Africa brings world-leading technology and ICT ideas to customers looking for unique and ever-changing solutions in a rapidly advancing market. CEO Frikkie Grobler tells Enterprise Africa more about the company’s growth through acquisition, and his plans for further advancement in Africa.

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There is a new player in South Africa’s ICT industry, one which is coming to deliver excellence and provide the industry with a refreshing approach to problem solving.

Logicalis South Africa was established in 2017 and quickly set about building a reputation for excellence, drawing on expertise from its South African parent company, Datatec, and utilising global technology from the international Logicalis business, established in the UK in 1997.

Over the past two years, Logicalis SA has been busy with a two-phase growth plan which has seen it complete acquisitions and build partnerships with prominent international IT organisations so that it can deliver its offering of: Problem – Solution – Results, in that order.

Logicalis is a specialist in IT solutions and managed services, bringing a wealth of knowledge in hardware, software, security, cloud, shared infrastructure solutions and much more.

After spending more than 30 years in the IT space in South Africa, Logicalis SA CEO, Frikkie Grobler realised that on too many occasions the big businesses were developing ideas and trying to sell them, no matter the needs from clients.

His idea was to create a company that listens to the requirements of the market and brings best-of-breed solutions, proven around the world, to realise real results.

“We are still small and that makes us very nimble,” Grobler tells Enterprise Africa. “All of our engagements are consultative engagements. We do not go to any corporates or potential customers and try and force solutions that do not fit. I preach to our people to listen, listen, listen. We evaluate opportunities and only then give advice on what is the best fit solution. If we cannot deliver, we will walk away.

“I want to measure our business by what we actually deliver,” he adds.

“I want a CFO to tell me that we have added 1% to bottom line, 2% to revenue, or improved productivity by

3% for example. We can only achieve that when we have a consultative process and a trusting relationship.”

This mantra is working for Logicalis which has already managed to pick up a number of corporate customers and is now building its reputation across the continent.

“Our first phase was to build an offshore managed services delivery capability, which we have done. Through that, we moved more than 40 managed services customers and 200 maintenance customers from the UK to SA for delivery,” says Grobler.

“The second phase is the local South African business and advancing into Africa - that was always going to be through strategic acquisition. Our first acquisition was Clarotech which was designed to gain solutions that we believe could open doors for us, and they had a fantastic customer base. The Mars acquisition was to help establish a presence across all of the major centres of South Africa.”

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INDUSTRY FOCUS: TECHNOLOGY

STRATEGIC ACQUISITIONS In September 2018, Logicalis SA completed its first acquisition when it onboarded Cape Town-based IP telephony (IPT) cloud and managed services business, Clarotech. This acquisition boosted the Logicalis portfolio significantly and helped the company to quickly grow its customer base, opening doors with a unique open source voice solution.

In July 2019, Logicalis’ second acquisition was announced after the company completed the purchase of nationwide IT services business Mars Technologies. Specialist in a range of services from remote monitoring of networks and servers through to anti-virus and printers, Mars boasts a history of more than two decades in South Africa.

Grobler, who was on the lookout for a second acquisition opportunity – specifically one which would help Logicalis build a national presence – was introduced to the Mars business by a business associate and friend.

“We did extensive research on the company before I was introduced to the MD,” he says. “Initially they were not ready to sell the business, but we continued our discussions and eventually they realised we were serious about acquiring the business when we put a non-solicited, nonbinding offer on the table.

“We were attracted to the Mars business because of its footprint. With offices in Cape Town, Johannesburg, Port Elizabeth, Durban and East London it gave us an instant national footprint and access to a strong customer base of small and mid-market

enterprises in these geographies.”

Grobler sees the reach as a vital part of the strategy to effectively service big corporate clients. Building a footprint of such scale is a task for many years, so acquisition makes a lot of sense for a company looking to make an impact quickly.

The Mars head office has moved into the Logicalis building and Grobler reports that culturally the businesses are a good fit. While the two companies are still trading as separate entities, full integration will be complete on 1 March 2020 after financial year end.

TECH PARTNERS Logicalis has an enviable list of partners through which it is able to source the very best solutions for its clients. While remaining independent, the company does enjoy several enviable relationships, not just in South Africa but around the world.

In September, the company announced details of a partnership with leading provider of cloud-based security and compliance solutions, Qualys. By partnering with Qualys Logicalis can offer customers a complete end-to-end IT security solution that complements any cloud strategy. As businesses change and CIOs require new and different options, this type of service will become invaluable.

“Digital transformation and investment in cloud infrastructure is growing at a rapid rate and while this brings new opportunities, it also presents new security risks,” explains Grobler. “There are new

// DIGITAL TRANSFORMATION AND INVESTMENT IN CLOUD INFRASTRUCTURE IS GROWING AT A RAPID RATE AND WHILE THIS BRINGS NEW OPPORTUNITIES, IT ALSO PRESENTS NEW SECURITY RISKS // 4 / www.enterprise-africa.net

// THE MARKET IS OPEN FOR A NEW PLAYER AT THIS POINT – THE FEEDBACK THAT WE ARE RECEIVING FROM A NUMBER OF CIOS IS THAT THE MARKET IS LOOKING FOR CHANGE AND LOOKING FOR A NEW PLAYER // vulnerabilities, new regulations and new business risks which are increasingly introduced with digital transformation. Qualys, the globally leading vulnerability management cloud platform, helps companies consolidate their IT security and compliance requirements into a single platform to ensure they remain riskmanaged and IT security compliant.”

In this partnership, Logicalis and Qualys have joined forces to help organisations reduce the number of risks to critical systems by rolling out a unique Vulnerability Management Service as part of a Managed Security Service.

Strong partnerships also exist with major players including Microsoft and Cisco, and it is through these relationships that Logicalis will grow, positioning the business right at the forefront of technological innovation.

“Our strength is in finding the best technologies from our range of vendors and combining them to bring practical solutions to help our clients deal with complicated challenges. We have done this successfully with Cisco, Microsoft and Qualys,” details Grobler.

LOGICALIS SOUTH AFRICA

AFRICAN EXPANSION When Logicalis has established itself firmly in the local South African market, Grobler makes no secret that next will be an expansion on the continent. The company has already dealt with enquiries from different corners of Africa and this is because, at its heart, it is an African operation.

Logicalis South Africa is owned 100% by Datatec, a company established in South Africa and listed on the JSE. Positioning the business as a South African operation has been vital during phase two of the company’s growth plan.

“We have only been approaching the local market since 1 March 2018 (previously we were focussed on providing services to offshore companies). Logicalis is a strong brand internationally but it is mostly unknown in South Africa. Datatec, however, is well established in South Africa, so we are leveraging the brand,” says the CEO. “We do have a lot of great tech that we can leverage from the international group and bring into SA, but essentially we play as a South African company offering global solutions with local expertise.”

When the current acquisitions are totally integrated in South Africa, the next step for Logicalis will be into sub-Saharan Africa before moving further north into other powerhouse African economies.

“Africa is definitely part of our strategy - we already have some interest from African banks for security services where we have assisted by offering various proposals. We have also been approached to supply some equipment into Africa.

“The area we have identified for Africa is within the financial sector. Talking to our local financial institutions, everyone is looking to grow into Africa and we really see that as our first phase drive into Africa.

Hopefully, a lot of that will be off the back of the relationships we have built locally in South Africa,” says Grobler.

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INDUSTRY FOCUS: TECHNOLOGY

He explains that questions have already rolled in from Zambia, Nigeria and Ghana, but the focus initially will be on those markets closer to home. “We are looking at which ones we can deliver on right now. It will probably start with Namibia, Botswana and Nigeria before we look at Uganda and Angola.”

BOOMING BUSINESS Over the past decade, the South African economy has become extremely hard to predict. Gone are the days of regular, year-on-year growth for the economy, and today we are riddled with technical recession one day and significant upswing the next. This creates a challenging investment climate for those looking to make long-term decisions.

“So many companies are disappearing and the ICT market has gone through a rough period where a lot of corporates have burnt their fingers. They are now more risk averse and you have to work hard for them to give you an opportunity,”

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says industry veteran, Grobler.

“We have noticed that projects are not necessarily being cancelled but they are being delayed. We were talking with a major financial company in London in February and they were expecting the project to launch in March but the project is only just getting under way now – plans and projects are constantly getting moved out. Corporates don’t have a lot of choice – they have to change but management are wary of making big investments with the current economic and political situation in the country,” he adds.

But in July, IT consultancy firm Gartner predicted that South Africa would become the fourth fastestgrowing major IT market in the world in 2019. IT spending is expected to increase by almost 4% on 2018 and the major investments in local data centres from big-names, including Microsoft, have buoyed the sector.

Logicalis South Africa is poised for further growth and has big ambitions.

“We come from a low base and it

// ALL OF OUR ENGAGEMENTS ARE CONSULTATIVE ENGAGEMENTS. WE DO NOT GO TO ANY CORPORATES OR POTENTIAL CUSTOMERS AND TRY AND FORCE SOLUTIONS THAT DO NOT FIT // is easy to grow at this point,” admits Grobler. “The market is open for a new player at this point – the feedback that we are receiving from a number of CIOs is that the market is looking for change and looking for a new player but establishing a new brand has its own challenges.

LOGICALIS SOUTH AFRICA

CEO FRIKKIE GROBLER

“We have signed some contracts with leading brands in South Africa, and that makes it easier. Again, the relationships with Cisco, Microsoft, Qualys and others are really helping us. We’ve also learned that we need to convince them that we can deliver quality service as they will introduce us to others as long as we can prove we are reliable.”

The range of the Logicalis portfolio, and its extensive knowledge base, make for a formidable new force

// ALL OF THE PEOPLE WERE SO EXCITED TO BE PART OF A BIGGER, INTERNATIONAL ORGANISATION AND THEY WERE ALL SEEING OPPORTUNITIES //

in the South African ICT space. Being a local company is the feather in the cap for this exciting organisation. Right now, things are upbeat for Logicalis.

“After we completed the Mars Technologies deal, I took a road trip and visited all branches throughout the country to meet people and get a feel for the attitude throughout the company – one of the biggest risks when you acquire a new company is that key people leave the company and you end up with nothing. The excitement and positivity that we experienced during the road trip was unreal. All of the people were so excited to be part of a bigger, international organisation and they were all seeing opportunities. Everyone asked if they would be able to work for Logicalis in other parts of the world and the answer was yes, as long as there is an opportunity and you are a good candidate,” says Grobler.

This enthusiasm was infectious in the CEO, and he remains optimistic and excited about future opportunities,

even during challenging local and global economic conditions.

“If you asked me on 1 March 2017 where we would be at the end of 2019, I might have guessed half of where we are now. To actually see what we have achieved is quite remarkable,” he says.

With more than 6000 people and annualised revenues of over $1.7 billion, the Logicalis brand is very strong, and the South African operation will soon become a bigger contributor. By bringing tailored solutions rather than pushing square pegs into round sockets, Grobler and team are continuing to deliver results for clients, and that is the reason Logicalis exists.

WWW.ZA.LOGICALIS.COM

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