Allied Electronics Corporation Limited (Altron)
Winner of the Greg Tosen Award for Excellence in the Management of Technology
Category for large enterprises
How to keep moving when markets are slow
Being first in a new market is first prize for any company, and in 52 years of operations, Altron has had its share of firsts. No less important than being first to market, though, is the ability to stay ahead in markets that are stagnant or saturated.
Altron , whose core business is information technology, telecommunications, and multimedia, is a pastmaster at stretching technology that much further – making it work better, finding new uses for it or taking it to new markets.
Consider the South African vehicle tracking and recovery sector. Altron, through Altech Netstar, is a market leader here, but the market itself has stagnated in recent years. Netstar’s response has been two-pronged.
First, it has improved its tracking technology so significantly that the rate of recovery within 45 minutes has rocketed from 60% to consistently above 90%, according to Dr Willie Oosthuysen, Group Executive: Technology and Strategy at Altron. Not content with that, it has increased its vehicle-tracking value add, such as by issuing real-time alerts to customers entering signal-jamming zones.
Second, using its core vehicle tracking and recovery capabilities as a springboard, Netstar has expanded into fleet management and telematics – a line of business that uses similar technology but has the added advantages of higher margins, lower risk and better customer retention.
More often than not, this kind of technological expansion paves the way for geographical expansion too. Altech Netstar recently acquired an Australian fleet management company, Pinpoint Communications, enabling it to enter the market down under. All in all, Altron and its portfolio of businesses now have a direct presence in 18 countries, including Botswana, China, Kenya, Mauritius, the United Arab Emirates and the United Kingdom, to name a few.
Some solid international success stories are emerging, such as the news that Altron-owned Bytes UK is the top cloud-licensing partner in the UK and has taken more companies into the cloud than anyone else in that market.
Strategic partnerships with some of the world’s best technology companies are a key pillar of Altron’s technology strategy, enabling the group to expand its already formidable IP portfolio and access a diverse array of technology and capabilities.
“We have ongoing access to the latest technologies worldwide through our partnerships, and at the same time have our own internal research and development programmes,” Oosthuysen says. “We actively encourage and promote internal technology implementation, the protection of intellectual property and the commercialisation thereof.”
The group certainly puts its money where its mouth is, investing millions of rands a year on research and development (R&D). The almost R70 million budgeted for R&D in 2016 included R30 million for vehicle security and fleet management technology and R40 million for telecommunications, IT and multimedia technology.
Says Oosthuysen: “In terms of managing technology, one of the things we do very well is to invest in future value-creating activities and skills. There is a handful of engineering and computer science (software engineering) students completing their studies on an annual basis in a variety of engineering disciplines in South Africa, and many of them work at Altron.”