SAP global services partner as main pillar of growth outside Latin America

Friday, June 3, 2011

Sizeable Latin American IT consultancies can be counted on one hand, and Neoris can definitely be considered part of this select group. But the firm is also looking to expand in other regions, such as Europe, the US, Africa and the Middle East.

During the SAP Sapphire event that took place in Orlando last month, Neoris was named a SAP global services partner, making it the first Latin American firm to attain this status. Will the partnership be just the leverage that Neoris needs to bring it to the next level in its worldwide focus?

BNamericas talked to Neoris CEO Claudio Muruzábal regarding the real impact of this new partnership.

BNamericas: What does the global services partnership with SAP mean for Neoris?

Muruzábal: This is a milestone for us as a company. There are approximately 3,000 SAP partners across the world, but only 23 of these partners are global services partners.

This is very important for us since we're still a young company. We kicked off operations 10 years ago, and we started working with SAP seven years ago. We now have 2,500 SAP consultants, and only a few companies have this number of consultants.

Despite the fact that we're experiencing global growth, Latin America continues to be our most important market, representing about half of our revenues.

BNamericas: How much do you expect to expand business this year compared to the previous year?

Muruzábal: We can't talk about the estimated revenues this year since we integrate our results with a public company. What I can say is that our annual revenues have been growing at rates of 30% in recent years, and this year will not be an exception. We aim to continue growing at significant rates.

What's also interesting is that we're seeing an evolution of our business in terms of quality. Now Neoris has access to global opportunities for SAP technology implementations, which are generally reserved for traditional companies in the IT market. Again, this is very important for us.

BNamericas: Do you think that this new status as a SAP global services partner will have a positive impact on the company's revenues next year?

Muruzábal: We're already feeling the positive effects of this new status, which will be one of the main pillars of our growth outside the Latin American region.

BNamericas: Apart from Latin America, in which other global markets are you experiencing significant business expansion?

Muruzábal: In the US market, where we've grown 100% in the last two years. This market represents a very strong opportunity for us. We also have developments in Europe and the Middle East, and we're looking into some possibilities in the Asian market.

BNamericas: What's the business outlook for Latin America?

Muruzábal: We're currently experiencing strong growth in certain markets across the region, particularly in Brazil, where we have over 850 employees, compared to 250 one year ago. Brazil is one of the main growth engines for our business in Latin America.

We can say that at a global level, the two markets where we are experiencing the highest growth rates are the US and Brazil. We expect to double the size of our Brazilian operation this year.

The Argentine market is also growing, [and it's] also a hub for the provision of services to the US market. Other markets where we see growth opportunities this year are Colombia, Chile and Peru.

BNamericas: And what about the Mexican market?

Muruzábal: We expect to see a lot of activity in the Mexican market during the second half of the year, particularly in the SAP segment.

BNamericas: You also mentioned that Neoris is looking for business development in the Asian market. What can you add on this plan?

Muruzábal: Asian markets are very dynamic, especially India and China. However, the competition is very intense. What we see is that there are certain segments in the SAP portfolio in which they are leaders at a global level.

We're accompanying SAP to implement those technologies in Asia. We don't expect to open offices in Asian countries; the idea is to go with SAP and explore these market opportunities.

BNamericas: Are you planning to open new offices in any market in the short or medium term?

Muruzábal: This year will be the year of consolidating our existing operations. We're making investments in Brazil, in the US, and we recently inaugurated an expansion of our excellence center in the city of Rosario, in Argentina. What we're doing is investing in the geographies where we already operate, rather than opening new offices. We have an extended geographical presence covering 12 countries. In Europe, we have consultants living in almost every country on the continent.

BNamericas: Neoris usually sets up operations in areas where there are universities that offer majors in IT, in a move to attract qualified employees. You are doing this in countries such as Argentina and Mexico. Are you planning to replicate this strategy in any other market?

Muruzábal: Yes, we do this because we believe that it's necessary to generate jobs in those areas where graduates are living. In countries such as Mexico and Argentina, there are excellent universities in the provinces but there aren't any job opportunities in these areas. This is why we have centers in small cities in the interior of these markets.

In the Buenos Aires province, we have a center in the city of Rojas. We also have centers in the Santa Fe province. In Mexico, we have facilities inside university campuses. We are looking to replicate this model. This model is positive for graduates and for the company - the wages may be slightly lower compared to large urban areas. In Brazil, we're also looking in to doing this. We will make announcements regarding this in the coming months.

In Latin America, we need to generate more human resources for our industry. This is a challenge that needs to be solved by universities, governments and IT companies. It's also necessary to update the IT courses and degrees offered by our universities so we can generate resources in line with what the market is demanding.

About Claudio Muruzábal

Claudio Muruzábal has more than 20 years of experience in the IT industry. Before joining Neoris, he held various positions in US ATM and self-service solutions provider NCR, including VP for financial sector solutions in Latin America and the Caribbean, Mexico country manager and Argentina country manager.

The executive has a degree in business administration from Universidad Católica Argentina and an MBA from Duke University.

About the company

Neoris, originally spun off from the operations of Mexican cement giant Cemex, is a privately owned firm that offers services such as systems integration, custom application development, IT consulting, and software deployment and support solutions.

Founded in Mexico but headquartered in Miami, Neoris has operations in the US, Europe, Latin America, Africa and the Middle East.