“This will cause a lot of angst with organisations looking to engage with managed services providers because a key part is longevity of engagement,” he said. “It could cause a rethink of those relationships.”
Commander’s downfall is also expected to negatively effect relationships between local IT suppliers and the public sector. Commander maintains a range of managed desktop and services contracts with state and federal governments such as the lucrative Group 8 including the Department of Agriculture, Fisheries and Forestry. It has also left dangling a string of support contracts with public and private schools.
One positive for integrators is that those customer contracts are now up for grabs. Corporate Express’ Heron said it had won a substantial number of ex-Commander customers by hiring its former staff.
And he isn’t the only one looking to snatch up disgruntled Commander’s customers. Last week, rival integrator, Ethan Group, launched a national advertising campaign declaring it would provide Commander customers with similar product pricing and match professional services quotes from their incumbent should they come across.
While it was a good opportunity for the Sydney-based integrator to expand its client base, managing director, Andrew Rayment, still found Commander’s predicament “unfortunate”.
“People have been made redundant and are left out of work. The other party at a major loss here is the customer. They’re in a situation where they now need to replace their partner and are feeling insecure about how their current needs are going to be addressed until they find a new one,” he said. “At the same time, they have set a budget for the year, based on set projects, based on set pricing. So they need to find a partner fast without compromising on due diligence.”
For Datacom CEO, Michael Browne, Commander’s exit could become a non-event if competitors continued to swallow up its customer base. He said Datacom had seen less and less of Commander over the past 12 months as it cut back its hardware reseller business and headcount.
“This could pan out without a ripple and be inconsequential for the industry,” he said. “It is a pity though – the elements that came together into Commander were successful and competitive companies. I don’t take any joy from this – a lot of people have been impacted through no fault of their own.”
Most integrators pointed the finger at Commander’s poor debt management and failure to sell-off assets as major reasons for its demise. Data#3’s Grant accused the company of “creating the bed it is lying in”.
“When the wind changed, they weren’t geared for it – there was too much debt and they got rid of a lot of revenue and customer growth when they closed down the integration part of the business,” he said.
But Leading Solutions managing director, Frank Colli, blamed Commander's aggressive product and services pricing.
"What there were doing in IT could not have future viability," he said.
