SAS UK boss talks SaaS, innovation and his first 90 days in the job...
Q&A: Ian Manocha, MD of SAS UK
Ian Manocha took over as managing director of SAS in the UK three months ago and has been busy putting his stamp on the company.
Manocha joined SAS to run the Manchester sales office in 1996 before becoming UK sales director and then MD of SAS Austria in 2007. He has also worked as a civil engineer for the military before stints at ICL and Unisys.
Ninety days into the job, Manocha spoke to silicon.com about the changes he's made at SAS UK, how consolidation of the software industry could threaten innovation, and how his experiences in the military have helped him in his new job.
The first 90 days
I'm enjoying it tremendously. We're just finishing my first quarter in the job and look to have had a pretty good result. I think the mood in the business is really very positive. We've moved through with some organisational changes that seem to have been well received.
Progress so far
Certainly I'm very keen that we raise the profile of what we can do as a business both externally and internally. One is around what we offer in terms of services alongside software. We're a software company but we recognise that we need to provide a very deep and broad services portfolio alongside the software offering.
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Our sales model and our solutions model now is increasingly focused around specific industry sectors and we need to deepen the skills we have. So we've formed banking practice and an insurance practice. We obviously had those skills before but they haven't been organised in that way.
And alongside the industry practices, we're also working on bringing to the fore some of the things that we're really, really good at that we want to become more of a headline in what we do. So we're building an analytics practice to really deepen the skills we've got and make sure that we continue to play to one of our real uniques in the market.
We've been working hard on the partnership side. Teradata is one, but also the other major systems integrators. So all of that's been quite a lot of work in the first quarter but I think that's a good long-term investment for us.
Getting ahead of the competition
What we're doing [on the services side] is moving from providing pure implementation delivery and training delivery, to being in a position where we can run much larger programmes. So it's less one-off projects - it's sustained programmes over multiple years. And what that means is we need programme management capability and the business consulting skills which align to the industry.
But we do recognise that we've got to really accelerate that now because of the size and scale of projects we're getting involved in. We're into multimillion projects on a very regular basis, whereas three or four years ago they were more of an exception.
Impact of the new MD
I think what I've managed to do really is inject a sense of pragmatism and pace to what we're doing. So ideas within the business at all levels are having an opportunity to surface and the best ones get done quicker. What I've managed to do is really inject some pace into it by saying that's the right thing to be doing, so what do we need to do and when are we going to do it?
The differences in private ownership
There is frankly more money to reinvest in the business as we're less worried about the dividend payment. And we can focus on the longer term - especially in the current market. Being able to stick with your strategy and do what you believe is right for the company and customers and to invest in the longest term is key.
I think on a more subtle basis it enables me as the leader of the business here in the UK to try to engender more of a sense of accountability amongst our employees to say, "Look actually we're privately held which means it's you guys who are running the business and you have to regard the company as your company, you have to regard the money that you spend in running the business as your money". It really does reinforce that as there's no where else to look. I think that's a subtlety that can be used in a very positive way.
On the other hand there are levels of exposure that one gets in a public company that can sometimes create healthy tension. So what it does mean is that managers [at SAS] have to create that healthy tension by reminding everyone that we are still here, we're a commercial business, we do have quarters the same as any company and we have to focus on driving performance.
To my mind, the overriding benefit of [this is that people] can't just say the reason I'm not doing something is because I'm worried about a shareholder - well actually the reason you may choose to do something is because you're worried about the company and the customers. It is a different focus.
A sense of responsibility
I think particularly when it comes to how we run the business commercially, that if we take a view around the world about the markets we need to grow or make investments in, there are going to be times when we want to reduce our profit expectations and invest more to get longer time growth, and there are going to be times it'll be the other way round. We've got more flexibility to choose how we do that. We agree targets that are sensible for the time and the place and the market space that we're in.
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Right now in the UK I want to invest significantly in the business because I think when the market gets tough - and it's fair to say it is getting tougher for people in the enterprise software world - SAS as a company tends to thrive and so we invest through those harder times and we tend to come out on top. We're doing that right now and I think in a privately held business those decisions get taken for the long term.
Trends in the software industry
We've seen a huge amount of consolidation. It's not a technology trend as such, it's a business trend, but I think it has some big implications. As the software industry does consolidate, where's the innovation going to come from? The large players are not always very good at that and the software industry over the last twenty years has thrived on having well-funded start-ups - some of who will not survive - who grow rapidly based on bright people on the technology side and aggressive folks on the sales side.
I am concerned that as the market consolidates that we won't see as much innovation - and in particular with perhaps the squeeze on credit that we have in the current market. So I think the trend towards consolidation is going to have an impact.
I think the trend for SOA and the like is well established. There are some big concerns around the complexity of software now and I think there's a big responsibility on the vendor community to focus on quality and support as systems get more complex. It's an area we've always put a lot of effort into and I think when you see complexity, new technology models and consolidation all going on at the same time one can conclude that big customers are going to be concerned that companies gobbling up smaller players [won't] be able to provide the level of support that they need.
SAS on SaaS
We've provided hosted solutions - so software as a service - predominantly in the US market for about seven years. We know it's a growing area in market, we know the IDC market figures, its $10bn market by 2009 - all that kind of stuff. We've grown quite a successful business in the US. Based on that, what we are doing right now - and we haven't taken a final decision - is looking at whether we can deploy that model here in the UK. I do think there's a business case there and that's what we're looking at.
[SaaS] plays well for us in the sense that as a software company, our business model has been a subscription-based business model from the day we first started 30 years ago. So we haven't been a company focused on selling perpetual licences - the business model for us is based on subscription - so in that sense it's less a decision about software as a service, it's more a decision about whether we host.
On the horizon
We want to expand our partnering-based approach. HSBC is an example of how to bring a new solution to market - we partnered in a very different way with a major customer. We signed up with them on a venture over a 15-year period to build a new solution, implement it, then take it into market. It's a reflection that solutions need more and more industry content and be more customised to specific industries, niches or business problems. That's gone well, to the extent where we've now signed up a second customer which is HBOS.
In terms of what we're doing in the UK, what you will see is a couple of big examples like that where we're moving our partnering model with customers to a totally different level. For us, partnering and innovation in the way we partner is going to be key.
Experience in military
Coming from a military background into a software company is not a natural progression but actually there's a whole load of disciplines that one gets used to. But I think the military stuff is less relevant. You can't run a modern IT-based business using those disciplines it's very, very different.