OA COMPSERVE: Daring To Experiment

Delhi-based OA Compserve started its operations keeping services in the
forefront and later diversifying into distribution and networking solutions. Its
ability to take on new business lines and make a success of them is largely due
to the foresight and keen business acumen of its founder, RK Malhotra.

Delhi’s RK Malhotra started OA Compserve (OAC) with an ambitious plan to
grow the company in to a Rs 100-crore empire within 15 years. Having crossed a
turnover of Rs 58 crore in 2002-03, OAC is well on its way to achieve this
benchmark, and is targeting Rs 70 crore in revenues for 2003-04.

RK MALHOTRA Striving to win bigger networking projects

Started with an investment of Rs 1 lakh and only five employees in 1990, the
company clocked Rs 5 lakh revenue in its first year. The next year, it grossed
Rs 25 lakh and since then there has been no looking back. Within five years it
had clocked Rs 20 crore in turnover. It also has 200 people on its payrolls.

This growth path came because of Malhotra’s foresight and his decision to
focus on service. Unlike most channel players, he did not make his debut in
business by trading hardware products. Instead, he opted to become the service
franchisee  of HCL.

The initial year and a half saw Malhotra entrench himself well in the Delhi
market creating good brand visibility for HCL. In fact, when HCL discontinued
its policy of franchising its services business, the vendor was unwilling to
break ties with OAC and offered Malhotra the opportunity to market its PCs and
consumables. "This offer gave me a chance to experiment with newer business
and products, which I accepted," recalls Malhotra.

Later, when Wipro started looking for servicing franchises, OAC became its
obvious choice in the northern region. This gave a major boost to OAC’s
business and it started adding other principals like Motorola and Apcom to its
its kitty.

"Our stint with Motorola was very memorable. We started with dealership
and services of data communication products and this gave us the platform to
acquire good technical skills," Malhotra reminisces.

TAKING ON NEW BUSINESS LINES

With the expansion of the business, Malhotra felt it necessary to conduct
business in a more orderly fashion. OAC converted two of its divisions into two
different companies - Silicon Comnet and Renovation Comnet.

Silicon Comnet looks after the networking business, while Renovation Comnet
takes care of the consumables business. As the parent company, OAC focused on
the flagship services business, which contributes 45% to the overall revenue.

Seeing good potential in the training business, the company opened OA
University in 1999, offering high-end computer courses. "We earn around Rs
8 to 10 lakh every month from this business and have opened a state-of-the-art
center in Gurgaon to train students," Malhotra adds.

Gurjeet Singh, Director, OAC feels that the primary strength of the company
is its willingness to experiment with new business lines. "I feel proud to
be associated with this group, because today our hard work has paid off and we
are one of the few respected companies in this city," he says.

Ajay Sharma, Assistant Marketing Manager had OAC joined OAC with the
objective of learning the ropes of the business, seven years ago. But he has no
plans to move on from here saying, "I don’t think any other organization
could have given me the same amount of learning and experience that I derived
from this group."

WHERE CUSTOMER IS KING

RK Malhotra believes that its loyal customers are the true reason behind its
success. And he is equally focused on the customer segments he is targeting.
Corporates and government divisions form a major part of his clientele. 

It networked the Army headquarter’s technical center and managed the Air
Force material and management project. This was followed by a Rs 3-crore project
for Hutch last fiscal.

The next in the pipeline is the Rs 3 crore research and referral hospital
project of the Indian Army. Malhotra is confident that he will bag this contract
as well since OAC is the forerunner in this race.

OAC also has good backing from its vendors for implementing projects of this
nature. Says Upender Jit Singh, Regional Sales Manager, 3Com India, "I feel
that OAC should concentrate more on handling big networking projects which will
help them strengthen their base.

This is very important if they want to be the leader in the networking
field."

WHAT NEXT?

For the coming fiscal, OA Compserve is going to focus on increasing its
bottomline. And this is precisely why it will consciously focus on big projects.
"I will not bother if our topline is growing or not. We have reached a
stage where we don´t need to say yes to every vendor. So our primary result
area would be to ensure that we do bigger projects," emphasizes Malhotra.

The company also wants to hone its technical skills in storage and high-end
servers business. It is also open to mergers and VC funding to enhance its
business proposition.

The company has two offices in Delhi and branches each in Gurgaon, Mumbai,
Jaipur, Kolkata and Chennai. Malhotra has no plans to add more offices at the
moment. His contention is that the company is present in the major regions and
has already established itself as a serious player in the channel place.

Now it will focus on making headlines in the networking business. And RK
Malhotra, is confident that this business too

will succeed, like all his past endeavors.

ATANU KUMAR DAS