TBR perspective

Logicalis’ efforts to optimize its legacy operations while doubling down on key growth areas such as cloud will largely depend on the company’s ability to develop integrated scale to ensure standardized service delivery. Evolving portfolio offerings, including the launch of its Digital Service Platform (DSP), paired with strengthening partner ecosystem relationships, will allow Logicalis to appeal to a broader buyer base and potentially disrupt the engagement model services companies are typically known for by offering digital routes to its services catalog. TBR believes this approach will be particularly applicable as COVID-19 pressures high-touch consulting services. Logicalis’ global scale is just the right size to test such a strategy as the company maintains a diverse mix of midmarket and enterprise clients. While the former group is the prime target for selling and supporting services through a click-to-buy model, many cost-conscious buyers from the latter group are also seeking ways to minimize external spend, providing Logicalis with a strong test bed for its customer experience model. Logicalis is not looking to change its DNA but rather to blend the best of both worlds with minimal disruption — adopting a software company-like sales strategy while maintaining human-delivered, automation-enabled services support to drive recurring (e.g., “as a Service”) revenue at scale. We recognize that this is easier said than done, but at least the company’s leadership appears to have their priorities aligned, which is a good place to start.

Logicalis will rely on strong customer service and repeatable IP to reshuffle the composition of its P&L toward more profitable recurring revenue opportunities

After only two weeks on the job as CEO, Robert Bailkoski, like many of his peers, had to address the global threat COVID-19 posed to the company’s operations, employees and clients. Bailkoski’s tenure with the company as CFO and later as COO had prepared him (as much as anyone could be prepared for a pandemic) not only to handle the situation with minimal disruption but also to ensure he stayed the course on many of the priorities he had set prior to becoming CEO. With Logicalis’ performance deeply rooted in selling both hardware and software products, which combined currently generate about 60% of company’s global revenue, Bailkoski knew he had an uphill battle as these areas are becoming largely commoditized and thus pressuring the company’s top and bottom lines.

In a recent conversation with Robert Bailkoski, Logicalis Group’s newly appointed CEO, as well as Vince DeLuca, Logicalis Group’s customer experience & service transformation officer, TBR had a chance to hear firsthand about the company’s goals and investments as it continues its journey to become a globally integrated solutions provider. TBR appreciated Bailkoski’s and DeLuca’s grounded approach to the company’s transformation, which is not something many newly appointed executives pursue as they often seek to create a name for themselves by making fundamental changes. We believe both Bailkoski’s and DeLuca’s tenure and understanding of the company have provided them with good visibility into Logicalis’ strengths and weakness and a sense of accountability needed to reach the company’s goals.

3Q20 vertical takeaways

Global organizations are battling supply chain issues due to COVID-19. IoT will continue to play a role in enhancing supply chains to help increase long-term resilience in the event of future pandemics or other disruptions. Automation in manufacturing and other verticals continues to be a major trend. Although some companies may have previously been reluctant to use robots due to concerns over the threat to people’s jobs, the pandemic has required businesses to find ways to maintain supply chains and productivity with less human interaction.

The healthcare vertical will continue to rapidly adopt IoT devices and solutions during the pandemic to help medical systems cope with the high volume of patients. Telehealth solutions remain in high demand, as do IoT solutions that are capable of monitoring changes in patient medical data as part of preventive medical treatments and otherwise delivering more efficient patient care.

Smart cities continue to look to IoT to increase public safety and assist with various public operations, including first responders and traffic equipment. However, smart cities increasingly need an overarching main IoT platform to better manage all the IoT sensor and camera deployments, which will help improve the real-time data analysis.

The Commercial IoT Market Landscape delivers overall market and top vertical insights, including identifying key use cases as well as trends in technology and buyer behavior. The landscape also captures the top public deals within those verticals and the lead vendors associated with them.

Bringing expertise, technology and experience to the business of running a port  

TBR has covered EY extensively, reporting on the firm’s evolution in both technology and global operations, most recently in a special report that noted, “EY has rapidly evolved its technology consulting practice and its overall value to clients around emerging technologies and is now addressing scale, standardization of quality across the globe, and sustained investments in innovation and the ecosystem through its common global strategy and practice architecture.” The wide-ranging discussion with Jonathan Beard and his colleagues reinforced that assessment, particularly in the way EY emphasized its opportunity to apply its industry markets expertise and technology capabilities to an ecosystem in need of rapid digital transformation.

The firm, according to James Wainwright, has been building on its NextWave Global Trade Initiative with its own assets and intellectual property, harnessed to long-developed understandings of the maritime industry, and pulling together its global technology consulting expertise. While the Global Trade Initiative is still a work in progress, EY has clearly made a commitment to play to its own strengths, move rapidly in an evolving market, and become a critical, trusted link within the broader ecosystem. Heading into the latter half of what has been a horrible year for everyone, EY’s specific challenges will reflect the headwinds across the maritime port and supply chain markets overall: coping with the pandemic, growing in a turbulent global macroeconomic climate, and investing in the right technology to solve the knottiest business problems.

To set the stage, Port Optimization solution Lead Wouter van Groenestijn noted that there exist “many suboptimalities in ports” and the operators, port authorities and others in the ecosystem collect vast amounts of data but very rarely tap into it. As an example, EY cited workforce planning — ensuring the right people are on location exactly when needed, based on a ship’s expected arrival — can be enhanced through data management, AI and analytics, provided the data is collected and used properly. With skills and experience combining vast and constantly evolving data sets, EY can play a role in addressing specific run-the-port problems, which span multiple ecosystem players, such as operators, shippers, regulators and freight-forwarding companies, and have a direct impact on operations and profitability.

In addition to providing expertise around data, EY serves as a useful ecosystem hub as it is a trusted partner to all the stakeholders within a port. TBR has heard multiple variations on this idea that maritime ports contain vast complexities with overlapping interests, jurisdictions and business models, reinforcing the need for a neutral party to handle shared concerns such as data. Optimizing that data then comes from, in EY’s estimation, knowing what to look for, which only comes through experience working with maritime port clients and their ecosystem clients and partners.

In mid-July TBR continued looking at the digital transformation parallels between maritime ports and smart cities by speaking with a team from EY’s Global Trade Initiative about the firm’s efforts with port authorities and broader port ecosystems. Jonathan Beard, partner, Strategy and Transactions, Hong Kong; James Wainwright, senior manager, Financial Services Advisory, London; Wouter van Groenestijn, associate partner, Strategy and Transactions, Singapore; and Lynn Dike, associate director, Brand, Marketing and Communications, London, described EY’s initiatives and solutions in the context of a wildly uncertain market. The following reflects that discussion and builds on TBR’s previous reporting on this space.