One of the best-known names in Canadian IT services is about to disappear from the landscape as DMR Consulting is folded into the new Fujitsu Consulting group.
"The key message for clients is that all the value and benefits of dealing with DMR are still going to be there, and there's no organizational change being made in Canada," Scott Garvey, president of DMR Consulting Canada, told globetechnology.com.
"Canada is the birthplace of DMR and has been a key part of the organization for 30 years. It continues to be exactly that / but we're going to be more closely affiliated with our parent [Fujitsu] so that we can take better advantage of the resources and skills we have available around the world."
DMR's CEO, Michael Poehner, will head up Edison, N.J.-based Fujitsu Consulting. A sister group, primarily operating in Europe, will be called Fujitsu Services.
The name change and restructuring becomes effective April 1 across Canada except for Quebec, where DMR was founded in 1973.
"In the short term we have determined that there are some advantages to maintaining the DMR name in Quebec," Mr. Garvey said. "That is just intended to be a transitional measure, though."
DMR was bought by Amdahl in 1995. Fujitsu held a share of Amdahl at the time, and acquired the rest of the company in 1997.
Fujitsu is the world's third-largest IT services company, after IBM and EDS. It has annual revenues of $44-billion (U.S.), of which $16-billion comes from software and services. But until now it has operated through a collection of subsidiaries around the world and has focused primarily on Asia, with the $11-billion Japanese subsidiary providing the bulk of its services revenue.
"Fujitsu is a top IT services brand in Japan, but it's not well recognized in the rest of the world," Mr. Garvey said. "The goal is to address that by creating a recognizable global brand in the form of Fujitsu Consulting and Fujitsu Services."
The move is a good one from a marketing perspective, according to IDC Canada's vice-president of services research, Lars Goransson.
"Fujitsu has tremendous capacity in the services space, but it has been housed in different companies in North America, Europe and Japan," he said. "Now they'll be able to bring all that together under a single banner, and over time that will bring them the advantage of a global brand presence. People will come to associate the Fujitsu name with [IT]services."
He added that the change also bodes well for the Canadian operation.
"There's no doubt it will be a challenge, because DMR is a strong brand in Canada and its customers have been with the company for a long time. But with a well-executed campaign, I believe they can pull it off and it should strengthen the company here," Mr. Goransson said.
"There's just no way they could build the DMR brand in the future the way they could the Fujitsu brand."
Software and services represent a major opportunity for Fujitsu, Mr. Garvey said, and the company aims to boost worldwide revenue from this segment to $20-billion by 2003. Fujitsu Consulting plans to focus on areas such as broadband Internet, telecommunications, servers, photonics and wireless technology.
DMR provides services ranging from outsourcing, business intelligence and enterprise integration, to analysis of customer relationship management installations and value-chain systems. Its customers range from Fortune 1,000 companies to government departments.
Prior to being merged with the new Fujitsu Consulting group, DMR had about 8,000 employees in 62 offices around the world, including 12 in Canada. The Canadian operation generates about 17 per cent of DMR's $800-million worldwide revenue, Mr. Garvey said.
On April 1, when it becomes part of Fujitsu Consulting, DMR will join the applications units of Fujitsu subsidiary ICL in the U.K. and Ireland, and the operations of Fujitsu Systems Business of America and Fujitsu Systems Europe. After the consolidation, Fujitsu Consulting will have 9,000 employees and annual revenue of $1-billion.
Fujitsu Consulting has set an aggressive goal of $1.5-billion in revenue by the end of 2004, Mr. Garvey said. "Part of that will likely involve strategic acquisitions to take advantage of opportunities in particular areas and geographies."
He said the bulk of the growth will come in the U.S. and European markets, since DMR is already entrenched in Canada. But Mr. Garvey added that the target for Canada is still "to grow faster than the market itself," although he declined to give specific figures.
The remainder of Europe's ICL will become the cornerstone of the company's new IT services subsidiary, Fujitsu Services. It will focus on IT services, such as traditional outsourcing, network development and help desk services, Mr. Garvey said.
"Fujitsu Services will be assessing their strategies with regards to operating outside Europe," he added. "But in the meantime, DMR [as Fujitsu Consulting]will be required to provide North American clients with things like infrastructure and application services through our staff and partners."
On April 1, Fujitsu Consulting will also convert parts of the Canadian DMR operation into formal resource centers for international clients. The Atlantic Development Centre will have 150 employees in Halifax, St. John, Fredericton and Moncton. They'll form a virtual team to handle things such as the outsourcing of application maintenance for global clients.
Fujitsu Consulting will also formally designate a group in Montreal as the Business Intelligence Development Centre. It will support the company's business intelligence teams across North America, Europe and Asia-Pacific.