Academic journal article Journal of Information Systems Education

GlobePort Faces Global Business Challenges-Assessing the Organizational Side of Information Systems Projects

Academic journal article Journal of Information Systems Education

GlobePort Faces Global Business Challenges-Assessing the Organizational Side of Information Systems Projects

Article excerpt

1. GLOBEPORT NETWORKS

GlobePort Networks is a leading multinational networking product design, development, manufacturing and servicing company. GlobePort is a market leader in the business of manufacturing and servicing of networking equipment, networks and network based applications (such as call centers, telephony applications). The company designs and manufactures a variety of communications hardware and software platforms and multiple applications--such as CRM (Customer Relationship Management), conferencing solutions and other telephony based applications. The company also resells other manufacturer's products and solutions. GlobePort has a large services business and organizational capabilities to support an end-customer's entire end to end networking solution. The services business is an important part of GlobePort's overall operations. Upwards of 50% of GlobePort's revenue (nearly $2 billion a year) and 115% of GlobePort's profit (approx $250 million) comes from the Services business. The service experience starts with consulting and design services, which work with end-customers to analyze needs. GlobePort offerings continue into integration and implementation of the solution. Subsequently GlobePort sells service contracts to the end-customer (large multinational customers such as multinational banks, as well as to smaller regional business customers such as hospitals, universities) on the basis of the product elements installed for the end-customer's service location. A service contract entitles the customer to extended service beyond the product warranty period. Service entitlements include help desk support, break fix support and maintenance, systems administration, network monitoring and management reporting activities.

2. INDIRECT CHANNEL ISSUES

GlobePort sells product and service through both a direct sales channel as well as an indirect (via distributors and resellers) sales channel. The indirect channel was used primarily in the international markets to exploit the existing local business practices of system resellers around the world and the established relationships between those distributors and resellers in those markets. GlobePort did not have the cultural capabilities of all these different local resellers and wanted to use them to build their global business model. The later consisted of a hierarchy of local retailers, solution providers and service providers under large regional distributors. Consequently, GlobePort allowed customers to order through either the direct or indirect channel, as some multinational companies had centralized purchasing organizations and wanted to deal directly with GlobePort for all their multiple global sites. In the indirect channel, GlobePort qualified the distributor and sold their product to the distributors. The distributors then qualified their local resellers and allowed the resellers to sell the product to end-customers.

There is a major difference between the two channels related to the service delivery experience as well. The direct channel customers received service from GlobePort, who maintained a few regional centers of excellence (e.g. at Singapore, London, Budapest, Casablanca, Buenos Aires and Denver) to deliver the field service. The alternative service delivery approach used in the indirect channel was to allow the end-customer to receive the service from the local reseller's service personnel. The resellers sold the products packaged with service offers to end-customers. The local resellers had the customer relationships and the local manpower to service the customers. It was difficult for GlobePort to maintain that kind of local operation throughout the world. Hence it was a win-win for GlobePort, who prided themselves in packaging and providing service to their customers and not just selling a "box" as their main competitors in the networking equipment industry.

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But developing the capability of these resellers to service sophisticated networking products was a challenge for GlobePort. …

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