FROM START-UP TO INDUSTRY STALWART After graduating from IBA in December 1998, I worked for Intel and then Indosuze WI Carr Securities for a year and a half. From there I joined hands with two of my friends and we started Inbox Business Technologies. At that time, there was a gap in the market between the foreign brands and the unorganised sector. We introduced the Inbox PC in the market and realised that it had good potential and we continued with that focus for over four years. In 2005, Dawood Group acquired a 51 percent stake in the company.
"Initially there had been an import duty of five percent on foreign assembled personal computers, while there was no duty on components. That duty was removed and a straight slab of sales tax was set at 15 percent."
The regulatory change had a double impact on the PC business. One, the cushion compared to foreign assembled PCs was gone. Secondly, the majority of domestic retail competition operated in the undocumented sector, thus undercutting legitimate firms by evading sales tax. It was time for Inbox Technologies to evolve its business strategy. Over the next two years, the company went into reseller mode for other brands while winding down the PC business.
BUSINESS STRATEGY EVOLVES By 2010, Inbox Technologies had a new-found focus on solutions and services. "At the end of the day, businesses deploy technology to resolve business problems. If you have a solution which addresses a pain area for a business, you will be successful; rather than being a commodity provider", he said. Consequently, the company changed its approach; going out to potential and existing customers, understanding their business needs; figuring out solutions to solve their business problems using technology tools.
The emergent needs meant providing diverse services to clients like integrating hardware, setting up infrastructure turnkey projects and providing managed services (service level agreements) for extended periods. At present, the major clients are among telecommunications, banking and public sectors and the business areas include infrastructure solutions, managed services, and business applications.
Citing prominent clients, the company's cofounder informed, "Standard Chartered Bank, Reckitt Benckiser, PTCL have outsourced their IT support to us. Similarly, Punjab Metro Bus Authority has outsourced its entire fare collection to us. Not only we implemented that solution; we are also running the operations for that."
The company now boasts over 1,400 employees across Karachi, Lahore, Islamabad as well as some dispersed on-site with clients. According to Ghias Khan, the company came across various opportunities and won contracts that have allowed them to establish expertise in different verticals. An enterprise resource planning system developed for the defence sector was among other key projects that helped Inbox Technologies to gain expertise it is now providing internationally.
ANALYZING THE MARKET SPACE The verticals that the company excels have placed it well in the domestic as well as international market. According to the Khan, there is immense potential in the domestic market for infrastructure implementations, system integrations and managed services. The expertise gained locally is marketable to other markets in the world. Current examples include Bangladesh, Sri Lanka, Singapore and the Middle East. "There are many companies in Pakistan that need to adopt technology. Many others need help in managing or outsourcing the same", he explained. The company has aggressive plans to play a role in major upcoming projects in the public sector as well
At present, given the maturity level of the telecommunications industry in the country, Inbox Technologies derives a major chunk of its domestic business from that market. Khan lamented that the number of products offered by the domestic banking industry is still relatively low, thus limiting banks' appetite when compared to the booming telco sector.
Business-consulting services are quite competitive internationally given the high acumen human resources and value proposition that Pakistan has to offer. Hence, this business area focuses on international markets. He informed that the company is establishing business development offices in Singapore and Dubai to chase down international opportunities more aggressively.
A LOOK UNDER THE HOOD Currently the Inbox team is comprised of more than 1400 individuals and the annual top line stands around Rs 3.9 billion. Of the total human resource pool, roughly one-third is part of the business consultancy teams while the rest are mostly working within managed services, infrastructure projects, etc. A sizeable portion of this group is deployed on-site at different projects. The company has aggressively recruited from within the sector and supplemented those efforts with a management trainee program and other HR initiatives aimed at developing business solutions expertise.
According to Khan, exports comprise about a tenth of the total revenue, while the lion's share is in Pakistan. He said, "I think it's a myth that doing business in Pakistan or in the public sector is difficult. If you come through on your commitments, deliver value; doing business in Pakistan is not difficult."
He insists that while the company is expanding its reach into regional and other markets, the domestic market will remain a major source of business for Inbox Technologies given the immense unrealised potential here. The company will also like to leverage the domestic market to fund future growth plans. "We firmly believe that the public is an excellent source for raising equity for expansion plans and we believe in going that route sooner rather than later" said Ghias Khan making no secrets about the company's intent to list on the stock exchange.