Insights: The birth of a tech super power happened under our noses!
Upon debuting as an end-to-end IT services provider, DXC Technology aimed to deliver on a digital promise.
A simple opening statement perhaps, made as the opening bell rung out on the trading floor of the New York Stock Exchange, at the commencement of trading on 3 April 2017.
Born out of a merger between CSC and the services business of Hewlett Packard Enterprise, a long line of customers and vendors formed an orderly queue to offer endorsements, from Coca-Cola and United Airlines, to Microsoft and SAP.
Such a display of unity and prosperity was nothing more than aesthetics however, the product of a well structured PR and marketing campaign.
Because underneath the surface, the coming together of two titans of industry was no easy task.
Globally, approximately 170,000 employees now work under the same brand, direction and roof, 10,000 of which reside in Australia and New Zealand (A/NZ).
In an industry dominated by mergers and acquisitions (M&A), joining at the hip appears more challenging that splitting at the side.
“DXC was created to lead the digital disruption cycle and help our clients thrive on change, built on a foundation of trust and transformation,” DXC Technology managing director A/NZ, Seelan Nayagam, said.
With a global customer base topping more than 6,000 organisations — of which 3,000 are served locally across A/NZ — DXC provides expertise across an expansive line-up of technologies, spanning cloud, mobility, security and application development, alongside IT services, big data and analytics.
“Our clients in Australia also benefit from our technology independence, global talent, expertise and an extensive ecosystem of over 250 partners,” Nayagam added. “Together with our partners, we are able to deliver the right solutions to address our clients’ critical business challenges.”
DXC exists as a titan of industry, holding company with fellow giants IBM, Accenture and NTT Data to name but a few, while not discounting the added emergence of Deloitte, EY, KPMG and PwC as credible technology competitors.
“The IT services industry is undergoing a technology paradigm shift that has strategic implications for all service providers in A/NZ,” Nayagam observed.
“Innovation and intelligent automation are rapidly changing the IT services business, and companies want to maximise performance and business outcomes from technology investments more than ever before.
“For companies like DXC, our success is built on creating a compelling value proposition and being a trusted advisor to our clients, investors and partners in today’s ever- changing market.”
Speaking as an industry veteran, Nayagam accepted that “competition is always rife” in the marketplace, creating a need for DXC — no matter how large — to operate as flexibly as possible to “meet and exceed” customer expectations.
“Disruption from unexpected market forces is always something that has the potential to be a threat, so it is important to stay nimble and tailor solutions for each customer to challenge any possible disruptions in their industry,” he cautioned.
Central to the success of DXC in the market will be the provider’s ability to maximise recent acquisition investments locally, following the CSC driven buyout of UXC in March 2016, and the more recent deals with M-Power Solutions and Sable37 earlier this year.
For some staff, the email signatures have evolved from UXC to CSC and now into DXC within the space of 24 months.
“Through our acquisitions, we’ve expanded our capabilities significantly and assembled the right capabilities to help our clients harness digital technologies for improved decision making, greater productivity and the creation of new business models,” Nayagam added.
“The acquisition of UXC in 2016 has significantly enhanced our capabilities in application platforms such as SAP, Oracle and Microsoft and enabled us to offer our global expertise to mid-market organisations as they make the shift to a digital- enabled economy.”
As explained by Nayagam, acquisitions — both locally and globally — are undertaken in line with DXC’s overall growth and digital transformation strategy.
“Where there is customer brand equity, we have retained the names of the companies we have acquired,” he said.
With more than half of DXC’s global customer base operating across A/NZ, it appears logical for the provider to continue investing in the local market, chiefly through increased acquisition activity.
Such a strategy started in Australia through the acquisition of M-Power Solutions in March 2018, a Perth-headquartered Oracle specialist partner.
By combining M-Power with DXC’s Red Rock practice, the tech giant aims to solidify its position as the “undisputed leader” in Oracle Cloud solutions locally.
“The acquisition of M-Power is a key part of Red Rock’s cloud-first strategy,” Nayagam explained. “It will accelerate the digital transformation journey for DXC’s enterprise clients and extend its strategic cloud migration services into DXC’s client base.
“Both organisations pride themselves on speed, agility and customer focus, and believe that our combined capability will offer significant benefits to all of our clients.”
Furthermore, the company gobbled up another specialist partner in Australia a month after closing the M Power deal, enhancing market capabilities through the acquisition of Sable37.
Headquartered in Melbourne, Sable37 provides expertise across Microsoft technologies, operating as one of the leading global partners for Dynamics 365.
The move was further supplemented by the acquisition of another Microsoft partner in eBECS, a provider based in the UK.
From an integration perspective, both businesses will be combined with DXC’s Eclipse practice, allowing DXC to significantly expand its Dynamics 365 cloud capabilities across the UK, Australia, New Zealand, India, UAE, Saudi Arabia, the US and Canada.
“We are always open to acquisitions that can add value to or enhance our digital transformation strategy,” Nayagam explained.
“These could include buys as ‘bolt- ons’ to our consultancy businesses, including Red Rock, our SAP consultancy Oxygen, and Microsoft consultancy Eclipse. Acquisitions in the broader digital space are also of interest to us.”
In the year ahead, Nayagam said DXC will continue to work closely with customers across major sectors on both sides of the Tasman, including government, healthcare, insurance and banking.
The move comes as digital transformation continues to absorb a greater share of IT budgets locally, as end-users place higher priorities on digitalisation.
According to Gartner research findings, CIOs across A/NZ exceed global peers in their expectation of digital spend from the IT budget, as well as in projections for the remainder of 2018.
In short, more local businesses are investing in digital initiatives and fewer in core systems such as ERP.
“We are uniquely positioned to lead digital transformations and create greater value for our people, clients and partners in Australia,” Nayagam said.
“Our priority in 2018 will be to guide our clients on their digital transformation journeys, multiply their capabilities and help them harness the power of innovation to thrive on change.
"DXC Technology has recognised the importance of combining innovation and collaboration to accelerate digital change in today’s rapidly changing market.”
For Nayagam, one the provider’s most significant initiatives to reflect this evolution is the opening of Digital Transformation Centres in Australia.
Unveiled in October 2017, the first two facilities will be in Canberra and Melbourne and co-located with universities, allowing for research between industry and academia.
“The Centres provide clients continual access to advisory services, present new and effective ways of working, and help clients design and develop digital solutions to solve business challenges,” Nayagam explained.
“This unique offering in Australia draws on collaborative minds and home-grown partnerships across industry, academia, community and government, and fosters a new culture of innovation in a digital world.
“We will also continue to harness the brightest talent and best ideas to bring innovation to our clients, and are focused on creating value to the local economy.”
In examining the changing face of the technology industry, Nayagam shared DXC’s own vision of how the future market will shape up within A/NZ.
Specifically, and perhaps unsurprisingly, the provider outlines six major trends capable of feeding the next wave of disruption and productivity.
“We see an aggressive move to common IT platforms and a major shift in skills and the war for digital talent,” Nayagam outlined.
“Also, the emergence of quantification as a driver of digital transformation; an emphasis on cyber resilience; business growth by extending digital capabilities and an explosion of opportunities with AI and neural networks.”
Nayagam believes such trends will serve as “critical guideposts” for organisations implementing digital strategies in the year ahead, as businesses attempt to overcome barriers associated to ageing technology solutions.
“One of our key priorities this year is helping our customers make the shift from legacy to digitally enabled solutions,” Nayagam said. “This is something that most of our customers will address within the next two to three years, if they haven’t already.
“Our challenge is highlighting the importance of adapting or running the risk of being left behind.”
Risk, in the context of increased security threats, is a different challenge however.
“Protecting our customers from cyber threats will always be paramount to our core objectives,” Nayagam added. “These threats to businesses are on the rise, and having sophisticated systems in place is more important than ever.
“We are always keen for our customers to be more versed in cloud technology and the efficiencies which can be gained as a result.”
Specific to technology, Nayagam said cyber security will continue to be a “huge focus” going forward for the business, with regulations and compliance “sure” to provide challenges to organisations during the next 12 months.
“We have to remain one step ahead of those behind such cyber threats,” Nayagam said. “I would say all technology providers are facing similar challenges at the moment — cyber threats, operational costs and disruption from unexpected market forces.”
From a global standpoint, DXC has established more than 250 partner network relationships, including 14 strategic partners, defined as having significant co-investment for engineering of offerings, sales and client delivery.
Specifically, vendors include Amazon Web Services, AT&T, Dell EMC, HCL, Hitachi, HPE, HP, IBM, Lenovo, Micro Focus, Microsoft, Oracle, PwC, SAP and ServiceNow.
“We also have a significant number of global and regional solution partners, critical to digital transformation, such as Mphasis, RedHat, Citrix, Symantec and Veritas,” Nayagam added.
“And recently we announced our partnership with BluePrism, as part of the launch of our Robotic Process Automation practice.
“We lean-in together with our partners and treat them as part of DXC Technology. We co- sell, co- solution and co-deliver.”
Such a strategy is designed to allow DXC to provide a “vendor agnostic” view of the digital world, creating “best of breed” platform choice in the process.
“Yet at the same time, irrespective of which platform our clients choose, we bring very deep, locally-based expertise to the table,” Nayagam qualified.
Locally, with the acquisition of UXC over 12 months ago, Nayagam said DXC is now positioned to assist across the best of breed platforms, with fully integrated ‘build- sell- deliver’ capability aligned to a single partner technology.
“Whether it be Oxygen for SAP, RedRock for Oracle, Fruition for ServiceNow, Eclipse for Microsoft Dynamics, Connect for Microsoft Azure, Professional Solutions for IBM, and our AWS practice for AWS,” he explained.
Furthermore, the provider’s Integrated Practices maintain close relationships with respective vendors, and have attained the highest levels of certifications in country for both reselling and services.
“For other partners not covered by these Integrated Practices, we are currently working with our global offering leads to identify the technology stacks that are in our 84 offerings – and which certifications are required within Australia and New Zealand, and which can be drawn upon from global resources,” Nayagam added.
“For example, our latest Workplace Offering has significant VMware components and we are currently running bootcamp training with them across our Build and Deliver business.”
Following a sizeable investment round internally, Nayagam said DXC has “really bet the farm” on vendors in a bid to leverage R&D capabilities, while also creating new routes to market across the technology spectrum.
“We don’t approach partners as a sub-contractor – many of our clients can’t differentiate us versus our partners because of that attitude,” Nayagam added.