Interview: Perry Blackney, CEO at Synergy

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Interview: Perry Blackney, CEO at Synergy

Blackney launched his career at IBM in the early 1980s. Now he’s charged with steering an IBM integrator looking for acquisitions and a public listing.

CRN: Perry, what’s your background?

Blackney: I did a commerce degree and spent seven years at IBM [starting] back in 1980. It was a great company then and it’s still a great company today. I worked in the banking, finance and retail branch. I thought that I would be at IBM forever but after seven years I felt that I hadn’t really seen what the real world was about.

I also have a strong finance interest and background so I became a stockbroker for three years, which was a bit of a left-field sort of career to take. As part of it I spent a bit of time in London in the finance industry and came back to Australia and got heavily involved in the IT industry. I worked for Lend Lease and Computer Associates. I joined CA because they had something like 200 products and I wanted to strengthen my software background.

An opportunity came up with Intel, which had gone into a branded set of products around networking, hub, switches and routers. I went in to run that business for Intel. After six months, I ended up running the whole channel for Intel -- anything through the channel in the southern part of Australia. I’d never run a channel business before.

I did that for a year or two then Intel launched a networking business worldwide and I set that business up for Intel Australia and New Zealand. Our job here was to work with the large multinational telecom equipment manufacturers to get into their designs and also to work with the development community.

That worked well but after two years I said to Dave [Bolt] (Intel’s then country manager) that I wanted to do something different and fortunately an opportunity came up for me to be the marketing director for that Intel business in Asia-Pacific -- so I went up to Taiwan for two years. Now in Asia-Pacific that communications business this year will probably do about US$3 billion, so it’s a substantial business.


CRN: What did you do from there?

Blackney: It was always a two-year project and after two years I was going to make a decision about whether I would go and do something different at Intel, stay in Asia or come back home. When the opportunity came up with Synergy I was interested for a couple of reasons.

Number one they are an IBM partner -- and IBM-only partner -- and if I was going to work with a non-multinational I wanted to work with someone who had a strong allegiance with the market leader.

The second attraction was that Synergy has a strong culture and background. The third thing was that when I looked at their business model -- they are very well positioned in the space that they are trying to complete. We do end-to-end hardware, software and services.


CRN: Was the opportunity the result of Bill Votsaris [the former CEO] deciding to step down?

Blackney: Bill wanted to go and do more of the strategic stuff. The board felt that it would be better if he did that. Given my corporate background [I could] bring into Synergy some of the structure and discipline that I’ve learnt over the past 20 years working for companies like IBM and Intel, and to embed that into the company, because if we’re going to list [on the ASX] a whole lot of that discipline has to be in the company.

Bill doesn’t have that, he’s an entrepreneur, he’s a unique individual who has been successful as an entrepreneur but moving forward they needed someone with a more structural background who can come in and put those disciplines into the business. Bill’s skills for the business are going to be way better used doing that entrepreneurial stuff -- acquisitions, negotiations and that sort of thing.

CRN: What drove the desire to list on the ASX?

Blackney: There’s no doubt that if we want to move the business from where we are today, we need some money to do that. If we’re going to make acquisitions, if we’re going to expand the company quickly, it’s going to take money. The fact that we have a pretty solid brand in the company today, I don’t think it will be too hard for us to raise some funds to do that. We will definitely list in the next six months.


CRN: So you will be acquiring some companies?

Blackney: We’ll certainly look for acquisitions in the areas where we particularly have weaknesses at the moment or where we want to grow.


CRN: What are those areas?

Blackney: We certainly want to expand the franchise to become much bigger in NSW. Given the amount of IT spend that’s in NSW, we do not have our share of revenue out of that space. We want to build the Melbourne model in Sydney but make it bigger.

So we probably need to make some acquisitions in NSW and maybe Queensland. We won’t move away from our core competencies and the acquisitions will have to be in line with [our] technology focus areas, and number two, culturally they’ll have to fit.

In Sydney we have competition with companies like Data#3 and we believe with the model we have in Melbourne, if we can build that in Sydney we have a great opportunity to challenge them in this market.


CRN: What model are you referring to?

Blackney: The end-to-end model -- the hardware, software, services all based on IBM-only technology, which is unique in this market. We are probably one of the few people in Australia that are IBM-only partners. I think that relationship is unique.


CRN:
Why do you think the company has gone that way? Other companies have diversified and reduced their reliance on a single vendor.

Blackney: Basically ex-IBM people started the company. So the culture is very IBM-oriented. Once you’ve worked for IBM, the culture is so strong, you never get rid of that ‘Blue’ blood. I’m glad that we’ve only ever been an IBM-only partner. If you look where IBM is in the marketplace today -- and there have been times over the last 10 or 15 years where IBM has stumbled -- today in the marketplace IBM is without doubt the leading IT company in the world.

I don’t think IBM has been in a stronger position than this for a long time. Back in the early 1990s, why [Synergy] didn’t move away from IBM I have no idea but today I’m happy to sit here and say it stayed the way it was. Synergy has IBM culture through its veins.


CRN: Has their been a big cultural change for you coming into the channel?

Blackney: Being on the other side of the fence gives you a different perspective as to what is required from a channel partner to be successful. Having been on the other side, we knew what it was for a multinational to be successful. Now I’m going to IBM and saying, ‘I know what you guys have to do to be successful, let me tell you what I need to do be successful’. Having that perspective is certainly helping me now.


CRN: What’s the financial position of the company at the moment?
Blackney: We’re currently a $40 million company in annual sales. Even without acquisitions, we can grow that 25 to 30 percent in FY2005-06. By 2008, we want to be a $100 million company.

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