Global IT management software vendor, CA Technologies, is all set to execute its vision for emerging markets where it expects to see double digit growth rates, especially from hyper growth economies such as India and China. The $4.3 billion company is increasing its sales headcount in emerging markets by 25 per cent which will take its headcount to 650 people in fiscal 2010-11. Additionally, CA Technologies is leveraging the expertise of a seasoned management team and localizing products to suit the needs of different emerging markets with a totally new approach to sales, pricing and packaging in these markets.
“Currently, 55 per cent of our revenue comes from the US and 45 per cent from international markets. We intend to flip that, to garner 55 per cent of our total revenue from international markets and 45 per cent from the US. This will largely be driven by the emerging markets. While growth from the mature markets is around 6 per cent, we expect 11-12 per cent growth from emerging markets” averred Bill McCracken, Chairman and CEO of CA Technologies. Addressing journalists from Asia Pacific during the 14th edition of CA World 2010, a conference attended by 7,000 people in Las Vegas, he said “You can expect to see me in Asia Pacific more often now.”
McCracken said CA Technologies’ new strategy and initiatives in virtualisation and the cloud would transform the way customers do business. Further elaborating on the company’s strategy for growth from emerging markets, John Ruthven, Executive VP, Growth and Emerging Markets, CA Technologies said “Earlier we treated all markets the same way, but in November 2009 we came up with a vision for growth and emerging markets, leading to the creation of a separate business unit for these markets - Latin America, Asia Pacific, Africa, Central Eastern Europe, Russia and Japan in November 2009. We will adopt disruptive strategies such as, SaaS (Software as a Service) and Managed Services to cater to these markets. More important, we will also be targeting an entirely new customer base of emerging enterprises whose revenues range between $300 million to $2 billion.”
Ruthven pointed out that the company had created a new role of Chairman in India, in addition to the CEO, to bring in a broader understanding of the workings of the domestic market along with strong operational experience to drive further growth. “Many of the organisations in emerging markets such as India will never build data centres but will leapfrog to low cost cloud computing IT environments. While we are uniquely positioned to manage complex IT Cloud Computing environments to these markets, underpinning this is our strong mainframe solutions base” he said.
CA Technologies has spent as much as $700 million last fiscal, buying a host of small cloud computing software providers including Nimsoft, NetQoS, Oblicore and 3Tera, which has helped the company to generate about one third of its $4.3 billion in sales from distributed software, or software that does not run on a mainframe. This year, Mr McCracken said the company will spend another $300 million to $500 million buying up small technology providers that could further expand its capabilities. “We are trying to buy technology that will allow us to grow” he said.