Datacentrix vs Business Connexion: Benjamin Mophatlane (Business Connexion) & Ahmed Mohamed (Datacentrix)
ALEC HOGG: It wasn’t quite light sabres at dawn in Midrand today, but the normal competitive friction between the two JSE-listed tech companies based there – that’s BCX and Datacentrix – has moved up a few levels. BCX sought and was granted an Anton Piller order against seven former employees in its Cisco networking team. These guys had joined Datacentrix and then promptly approached their old companies clients, including the South African Reserve Bank, trying to win business for Datacentrix. Well, in the light of the reaction, the obvious question to BCX chief executive Benjamin Mophatlane is: how much will the defections hurt BCX’s business?
BENJAMIN MOPHATLANE: We are one of the top three Cisco partners in the market, so in terms of our competitive space, Dimension Data is number one, you've got ourselves, we’ve got BTG, you’ve got Telkom as well in that space. Datacentrix are possibly an infant into that space and it’s important for us to highlight that we are not stopping a competitor entering this space. Quite honestly I am quite happy for them to ply their trade at Datacentrix. This is not the restraint because I am saying don’t go and work for Datacentrix. That’s very important. All I am saying is if you are going to work for any of our competitors, do not go away with information that is deemed to be sensitive and confidential and that belongs to Business Connexion.
ALEC HOGG: Ben, if I understand it correctly and it seems now it is getting more clear, Datacentrix was not in this space. There was a team of guys at BCX who have now moved across and they are moving into this space as a result of that.
BENJAMIN MOPHATLANE: One hundred percent. They’ve always had Cisco networking skills, like all IT companies, but it hasn’t been on the size – we have a lot of our people moving between the major players in Dimension Data, ourselves, Telkom, who've got Cisco skills. And I think it is important to highlight that we are not stopping those guys -- because it’s not imperative to stop them becoming Cisco gold partners. To become a Cisco gold partner you've got to invest in certain skills, you have to get the right people on board. Now with that path we are not unhappy that one of our competitors is entering that space. What we are unhappy about is that enter the space, compete with us on a fair basis -- and that’s more important.
ALEC HOGG: So don’t steal our intellectual property.
BENJAMIN MOPHATLANE: That’s all, that skill for us is very important. We think that competition is welcome competition. We are never going to stop them competing - I think any one of the players in the market can go in there and want to compete with Business Connexion or anybody else. It’s not just our domain. I think it’s important on how you go about it.
ALEC HOGG: Well, Ahmed Mahomed joins us now. He’s the chief executive of Datacentrix. According to Benjamin Mophatlane, these guys stole intellectual property from him. The court seems to agree with him, Ahmed. What's your view?
AHMED MAHOMED: Hi, Alec, thanks for having me on the show. Our reaction is we are expanding our business and we are recruiting a number of resources in the market and, as you know, the IT market is quite a small market. So we lose skills to competitors, and similarly we gain skills from other competitors. As we are growing the intellectual property, we've been a very ethical organisation and we are known for that in the marketplace, where we haven't been unethical in any way in our dealings either with clients or with vendors or competitors. If there is any intellectual property that has come across, it's certainly not wittingly from our perspective.
What we've done is we've recruited resources. Six resources out of 1 300 researchers is hardly saying that we are going in a big way in terms of the Cisco space. We've always played in that space. We needed to boost our technical competencies and we've gone to market to recruit resources, and we recruited some from BCX, and we've recruited some from other competitors in the market.
ALEC HOGG: Is it normal practice for your guys, when you recruit them, you bring them on board, to send them to the people that they used to be working with, like the Reserve Bank and so on? Is that normal practice?
AHMED MAHOMED: Well, where there is a restraint obviously we respect that restraint and we wouldn’t send them into the accounts in which they’ve operated in. But certainly from a technical skills basis, these are not your typical sales guys. We've got a significant sales force that sells out there. So your technical capabilities, really, and execution capabilities – that’s what we've brought across. As far as intellectual property is concerned from a technical competence point of view these are very generic skills in the market. Cisco certifications are fairly generic so there shouldn’t really be any IP relating to that…
ALEC HOGG: Ahmed, I understand that, but an Anton Piller order is not easy to get. You and I both know that. You go to court, it's a tough thing to get, it was granted to BCX. They came across to your offices, took away laptops, cellphones, etc. That's pretty heavy stuff. Surely, from your perspective, you should at least be taking a different approach and saying: “Hang on guys, this isn't the way that we do business. Maybe you got the wrong end of the stick.”
AHMED MAHOMED: And we have done that with the new resources that have come on board. But just bear in mind that the Anton Piller award effectively grants you an interim order to preserve the information that is there, presumably the information that is proprietary. And absolutely we have cooperated with that and we've provided the information that was required by the Anton Piller award.
ALEC HOGG: What are you going to do with… [overtalking]
AHMED MAHOMED: …right to respond to it and we will obviously respond to it.
ALEC HOGG: Oh, so you are actually backing your guys there?
AHMED MAHOMED: Well, we don’t know what information has been brought across. So, in all honesty, the technical guys, they come with information across which is in their heads. They understand that business and that’s why we recruit them. But if there is any proprietary information that has come across that is specific to BCX, I don’t know. I can't say definitively that that is the case. But as far as we know we haven't requested nor have we got access to that type of…
ALEC HOGG: Come on, Ahmed. They were working with the Reserve Bank, they were working on those accounts, they were working with those companies. Clearly there’s information that they have there that they would be able to use to maybe try and get the business over. Surely you should be taking a stronger line. That's all I'm questioning you about.
AHMED MAHOMED: No, and we are taking a stronger line with the individuals involved, absolutely. That's a case internally. We have addressed the resources available. But also bear in mind let’s put it into context, Alec. Six resources from 400 resources we've got – so it's insignificant in that light.
But coming back to the specific information that we've got, we are talking in terms of the intellectual property, it's fairly generic skills in the market. Yes, it's scarce skills, but it's fairly generic. Coming back to the Reserve Bank in fact we are not tendering for any Cisco business in the Reserve Bank. We are tendering for IBM business. So I'm confused about that statement that we are competing with BCX at the Reserve Bank, and as far as I know, the Reserve Bank doesn’t even belong to BCX…
ALEC HOGG: … well, I'm sure we'll get to the bottom of it in due course, as will you, Ahmed Mahomed, the chief executive of Datacentrix.
• Subscribe to a daily email of transcripts from Moneyweb Radio - click here