Computacenter builds out apps business with new Cluj centre
Computacenter plans to expand its application development business, building on strong customer demand in Europe, and supplementing its successful infrastructure services business.
The expansion plans centre on a new business unit delivering application services from Cluj, Romania. The move will see the firm boost capacity alongside its growing onshore presence in Germany which has organically grown to over 180 developers.
Cluj, often described as Romania's Silicon Valley, is home to a large pool of development talent that has lured many IT services giants to set up delivery centres in the city. This means Computacenter will face stiff competition to attract the best and brightest developers on offer. Nevertheless, the firm has ambitious growth plans - looking to attract 300 developers by 2023, rising to 500 by 2025. To do this, the firm plans to build strong relationships with local educational institutions, create a 'start-up' look and feel to the business unit and offer exciting project work. The firm is also considering small acquisitions, as well as arrangements with partners that will see Computacenter onboard talent over long-term engagements.
The company is clear that cost reduction isn't the core driving force behind the investment, but rather it is about tapping into deeper talent pools than it has access to in other regions. Alongside this core ambition, is the recognition that the application development work - already in high demand - is a necessary building block of modern enterprise services and a valuable funnel into Computacenter’s traditional strength in the infrastructure market.
The strategic imperative from Computacenter isn't to compete with the big global SIs - who can bring thousands of skilled developers to engagements - but to focus a smaller team of the best developers on the market at high-value client engagements that expand into long-term sustainable relationships.
On the face of it, notwithstanding initial talent attraction challenges that all service providers face, the plan makes a lot of sense. The region, particularly Cluj and several other key cities in Romania, are now dynamic centres of IT talent - supported by a mature ecosystem of government, educational institutions, and businesses. The region also supports the ongoing demand for nearshore talent across Europe. And while cost reduction isn't the focus, it's likely the long-term commercial benefits will pay off when compared to developing locations in Germany, for example.
The news follows strong financial results from Computacenter, which saw a strong year despite the impact of the COVID-19 pandemic. It was supported by buoyant demand in the public sector and services-focused firms, which covered lost ground in harder hit industries such as manufacturing.
As we emerge from the pandemic, we can expect stronger enterprise appetite for IT and Digital services, as businesses redraw the boundaries of their operations, and invest in transformation to meet shifting market demands. Computacenter is right to invest in building out its talent pool in the application services market now, as an adjunct to its core infrastructure business.