There is much to be said about the loss of a major channel partner, but the advent of the cloud and cloud purchasing models mean that it is becoming ever harder to pretend that you have the long term contracts and value when it is becoming easier to buy solutions on an ‘on demand’ basis.
Perhaps the combination of the current stagnant economy, changing patterns of consumer and business demands and indeed the ever present messaging around IT becoming simpler, faster and cheaper are taking its toll on the conventional IT models.
One thing is for sure- the closer we are to our customers and understanding their needs, the less chance there is of this happening to others.
We attach an article from the Register for reference.
Stricken giant 2e2 may be sold off in one by Monday
By | Paul Kunert 1st February 2013 13:28
Most staff paid for January, implored to stay aboard.
The sale of fallen integrator 2e2 may be finalised as early as Monday with administrator FTI Consulting looking to offload all of the UK biz to just one buyer, say people close to the talks.
All of the major household names in the channel are understood to have looked under the hood of the Berkshire-based company since ten UK subs went into administration on 28 January.”The UK assets are going to go imminently and they want someone to buy the lot,” said a source close to the talks.
“The problem is,” our mole claimed, “they’ve [FTI] been very clear, they can’t pay the next set of wages so need to get a deal done in the next two to three days”FTI wrote a memo to staff last night, seen by The Channel, in which it said it was unable to provide specific details of the sale talks, but claimed to be “confident” of selling the UK biz in the “near term”.
It asked for “continued service and support” from staff, and said: “You will therefore continue to be paid by your existing employer entity through the period your services are required”.
This includes basic pay, approved overtime, and employer contribution to the pension scheme.Earlier this week, FTI told staff it was “reviewing” wages, with respect to the “overall financial situation” of 2e2. It said all work related expenses will also be reviewed and fuel and credit cards cancelled.
Some 319 staff were axed on Tuesday, including the CEO, CTO, COOs and CFO as well as rafts of people from marketing, HR, pre-sales and other departments across the UK. None were paid for January. Onlookers took this to mean that FTI might break up the UK operation and sell it piecemeal.Buyers of the UK subsidiaries in administration do not legally have to assume liabilities held by 2e2 including sums owed to trade creditors. However the firm has an estimated £50m to £60m worth of debts owed to important suppliers, claim industry sources, and these suppliers may be reluctant to do further business if they aren’t paid some cash.
“If you want to continue to deal with Cisco or any of the distributors you are going to be held to ransom because they [2e2] owe so much money,” claimed one.
He said rivals were also trying to exploit the situation by contacting 2e2 customers to ascertain if IT service delivery was impacted.
Contractors working on smaller deals had their contracts terminated this week, though those working in top priority areas including the NHS were reportedly to be retained so as to ensure continuity of service.
Some sources this morning told us this had still not happened.
In its memo from last night, FTI warned staff it “cannot make guarantees” it will not make more staff redundant and some were braced for the worst today with a conference planned for 11am.
The Channel understands that another 26 heads rolled at that point. ®