Aussie on a bet

“We’ve been in the security market for the last four to five years. Netlan is an engineering company and we’ve always been very customer-focused and technology-driven so we move with the demand.”

“Security is the number one demand in the industry at the moment. If companies don’t have adequate security, they’re wide open to abuse. We have a corporate business but also a lot of education clients and there you need to have protection inside and outside,” Baurhenn says.

While Baurhenn has a solid track record of picking the trends in the market, he admits that sometimes other factors are involved. “Deep down I’m an engineer but I have a good feeling for the way the market moves and I think that’s one of the reasons why Netlan is here and still very strong in the marketplace. But then again getting into the education market wasn’t a deliberate decision.”

Netlan was doing contract work for IBM and other vendors in the early days when these companies did not really understand network topology, he says.

“They’d say we’ve got an IBM network with token ring and it’s very passive. We had equipment that was very active token ring kit so we were asked by IBM to go in and fix the problem.”

“We compete against huge companies that may do the job a bit cheaper or they buy the job but we are there for the long run. We’re flexible enough to move and change whenever the industry demands it.”

One of the first of those changes that Baurhenn picked was the move away from Novell towards Microsoft in the networking software market.

“In my time in the industry I have seen companies that start off well, peak and crash and burn. When I was still in Germany, Tally was bought by Mannes; we had a really good story to tell but after a while there was nothing left.”

Each time it is the same thing, believes Baurhenn. Vendors think that they can do things better than the reseller. "I have seen it time and time again: big vendors have a reseller network but then they think there’s money to be made by getting rid of the resellers and going direct and that has caused the death of so many big companies in the IT industry. That’s what Novell did.

“Data Peripherals used to be the sole distribution for Novell and we had a great reseller network but then they basically just went stupid and took it direct.”

“I think the greed took over. But there was nothing wrong with the technology, we’ve still got clients that still very happily run Novell and it just works.”

Another part of Netlan’s success is that Baurhenn keeps the company very focused and will sometimes say no to a vendor or customer he believes is trying to take the company too far away from its core business.

In other cases he has been willing to tackle an opportunity in the market but in partnership with another company rather than by expanding Netlan’s capabilities.

“It’s only been in the last three years, for example, that we have taken on desktop integration. We’ve done this through a partnership with another company but between the two of us we’re able to offer a complete solution, from design and consulting to the cabling, the LAN and WAN equipment and desktop integration. We’re both independent companies and we’re part of a bunch of SIs around the country, which lets us roll out all over Australia under one banner.”

One of the gaps in the market Netlan has tackled in this way has been in the education sector, a niche in which Baurhenn has a long track record. “We’ve got education clients such as Pymble Ladies College (PLC) that have been with us since first putting in a LAN 15 years ago,” he says.

“PLC is a big school, it’s got 2500 users, but we’ve got quite a few schools out there that don’t have any IT staff at all and we saw that as being a gap in the market. We are able to do 60 percent of the work remotely while the remaining 40 percent we do on-site. The cost saving for the school is about half the cost of hiring an IT manager so everyone wins.”

It’s a perfect example of the shift in the market says Baurhenn. “Ten years ago a company could make money from dropping boxes but now there’s hardly any margin in hardware.”

PLC is not the only client that Netlan has kept on its books for well over a decade, says Baurhenn. “It’s very simple to keep customers that long -- 99 percent of our dealings are built on relationships and being honest with the people. If you can basically be flexible enough to work with them, meet their demands and give good to excellent service or beyond, you’ll always make money and keep the customer.”

Netlan has outlived three IT managers at PLC and it has been a similar situation with some corporate customers like Merck Sharpe & Dohme.

“The company has been there 16 years and we’re still dealing with them” Baurhenn says. “Other integrators have tried to get in there and have come and gone and we’re still there. The key is to do a good job, document everything and if a new IT manager comes in you make an appointment to see them.”

“Then it’s like having a dog: he either loves you or he hates you, there’s nothing in between. That’s what I’ve found in the industry. I lose some clients when the IT manager changes but that doesn’t happen that often. Also sometimes the vendor changes and they either love us or they hate us.”