Empowering The Networks

In a highly fragmented UPS market, MNC players such as Emerson are

reaping benefits by adopting a solutions approach

The IT

peripherals market across segments has seen consistent growth over the years.

Printers used to dominate the peripherals space in the past, but in the last

couple of years, other segments have also gained considerable importance. In

this line UPS as a market has gained huge traction in the recent times. This is

so because computing resources today have to be available 24x7, and even a low

downtime is not acceptable. Given that UPS is considered a key component of

organization's backend IT infrastructure, it plays a key role in the 24x7

computing. Nevertheless UPS as a market in India is highly fragmented with

numerous unorganized players. Things started changing in the UPS space when

multinational companies entered India with their product offerings in the 1990s.

This made the market

tri-polar in time, comprising Indians, MNCs, and unorganized players. If we look

at the MNC UPS companies, one player who merits closer attention is Emerson

Network Power.

Emerson came to India

(then known as Tata Liebert) in 1993. According to company sources it has grown

at a rate of over 30% y-o-y over the last 12 years. For the fiscal that ended

March 2005, Dataquest estimates pegged Emerson's revenues at Rs 300 crore.

This puts Emerson as a leading UPS player in the country. The company was able

to ramp up due to its focused offerings catering to the high, mid and low-end

segment of the market.

The Strategy



The company underwent a shift in holding in 2001 and came to be known as

Emerson Network Power.  With change

in ownership, Emerson Network Power India made a conscious effort to align with

its $17.3 bn global parent. But it was a daunting task that called for bringing

together world-renowned brands under the Emerson Network Power India. Moreover,

competition with the established names such as APC, Numeric, DB Power, and the

likes dominating the UPS market was already there. Thus, Emerson adopted a two

pronged strategy—one it moved from a UPS company to a business critical

continuity solutions provider. Second-it offered UPS across all segments as

Emerson was initially considered as catering only to the high-end enterprise

requirements.

Shrikant Bapat, senior

vice-president, Uptime Solutions, Emerson Network Power says, “The transition

to a vertical focused strategy enabled us to move effectively to leverage our

solutions. For instance we focused on verticals such as telecom, Internet, IT,

software, and industrial process control. These verticals by nature of their

business and end customer expectations were identified as power intensive

segments.”

Clearly it is a

solutions approach, which the company adopted rather than plain product selling.

For instance the company aligned on a strategy called Network Uptime Solutions,

which enabled it to develop the solution right from client's network design

stage as opposed to stepping in when clients were forced to realize the value of

uptime as fallout from a crisis. Being a hardware company, it adopted a

solutions model. Also its success was purely based on the kind of human

resources that can transition in a changed environment. To support the

realignment of its business, Emerson reorganized its business to create

champions of Network Uptime Solutions for its customers over its entire power

requirement range.

With the focus on the

SMEs, Emerson has adopted some innovative channel initiatives. For instance the

company is in the process of selecting few partners and plans to teach them on

various aspects of selling power solutions to corporate clients. This will start

with consultancy covering concepts such as doing a power quality audit,

understanding criticality definitions to ensure zero-downtime on the

business-critical operations, and nature of power solutions needed for different

areas among others.”

Businesses are now looking at uptime solutions from a strategic viewpoint. They are looking at power solutions from the viewpoint of the entire network

Going Forward



Emerson, despite the fragmentary nature of the Indian UPS market was able to

slice into the it and counter competition from Indian companies such as Numeric

and DB Power. For the top line UPS vendors the high-end enterprise is where the

bulk of revenues come from. And this is where Emerson is positioned well right

now. In the days ahead it will gain traction in the low-end space. Due to

enormous growth in the IT, Telecom, and BPO sectors, businesses are becoming

more service oriented and are trying to provide customers with fast and

efficient service on a 24x7 basis. Bapat says, “The high growth of a connected

economy is creating global networks, which need to be on 24 hours a day. So they

just cannot afford any kind of downtime. Hence, businesses are now looking at

uptime solutions from a strategic viewpoint. They are looking at power solutions

from the viewpoint of the entire network. This would encompass defining a power

conditioning strategy depending upon the complexity of the infrastructure to

enable the smooth and efficient running of the entire network.”

As V Niju, industry

analyst, Industrial Technologies Practice, Frost & Sullivan says, “We

believe that Emerson has the strongest repertoire of products to offer in the

Indian UPS market. Today, Emerson has recognized the volume potential in the

low-end UPS category and has taken steps to address its inadequacy of products

in this segment.”

Recently Emerson has

forayed into the SOHO UPS segment, with the launch of two UPS models, the 600VA,

and the 1000VA under the ITON range. This again makes the overall market

environment more competitive as this is in the volume space. As per IDC

estimates, there are about 1.7 mn organizations that fall under the small office

home office segment comprising one to nine PCs. Most customers in this segment

look for longer backup time along with reliable hardware protection. The SOHO

segment, thus, represents a tremendous business opportunity for players such as

Emerson. The future for the Indian market is quite promising. The UPS business

has been growing tremendously in India and will continue to grow in the coming

years. Players such as Emerson will continue to cash in on this boom.

Shrikanth

G in Chennai    



shrikanthg@cybermedia.co.in