RRC Strategic Development for 2003-2005

RRC top management announced new organizational strategy for 2003-2005 at the press conference held in Sheraton Palace Hotel, Moscow on November 28th, 2002.

The former strategy was worked out many years ago, so, with both operations format and business requirements considerably changed, a decision was taken to work out a new strategy aimed at securing stability of RRC business along with optimal allocation of resources in the new market environment.

The following tendencies could be noted to characterize the distribution market of today. Firstly, globalization -- international distribution companies are ousting local players employing their financial and political abilities. Secondly, it is change of investment perspectives of the IT market as a whole. It is mostly associated with the changed attitude to Internet companies and continuing recession on NASDAQ. According to all forecasts, over the next five years, the IT services market will be the most rapidly growing and the companies working on this market will be the most attractive from the investors' point of view. All the above mentioned naturally affects high technologies market development as a derivative of the real sector, also influencing business of most companies.

RRC realized the necessity of strategic changes a year ago. For the last few months top management of the company was working on the new strategy and preparing resources for its realization. It was crucial to get a vision of the company we'd like to become in 2-3 years, of what we want to achieve. For today the modified mission of the company is the following:

Employing successful business experience since 1992, to become a company that efficiently meets needs of society in advanced information technologies in accordance with international standards
In order to bring to life the targets set, top management thought it necessary to re-organize the company. In particular, aiming at increasing operations effectiveness, it was considered strategically important to single out the departments of corporate networks and personal communication devices into separate divisions, although formerly they had combined operations. Thus, new business divisions Focus Distribution and Enterprise Networking are based on the department of personal communication devices and the department of corporate networks respectively. Taking into consideration geographic coverage of RRC business comprising 7 offices in 5 East European countries, it should be noted that the respective structures of regional offices would also be split up into two independent divisions. Besides, within all offices an absolutely new division will be established, which will be engaged in training, consulting and service rendering - RRC Consulting Services. Further, those divisions can be reorganized into independent companies within RRC holding. The specific terms and forms of such breaking up will be determined for each office (country) individually subject to the current situation there and office development prospects.

RRC Focus Distribution, RRC Enterprise Networking, and further RRC Consulting Services are developing business within the framework of one holding, thus presupposed positioning of these three structures is closely connected.

Uniting concept of positioning all the companies of one holding as EXPERT companies allows highlighting specific characteristics of each one.

Speaking about RRC Focus Distribution, it's worth noting that major business of the division is distribution of niche equipment that does not require profound technical expertise. Experience and the right to be considered an expert in this field is undoubtedly secured by the fact that the company has 10 years of successful sales of this equipment and, accordingly, has accumulated unique techniques. RRC has developed effective logistics schemes, has optimized the process of stock and price forming, while thoroughly balanced product portfolio allows the company to focus on developing the market of these products.

Among tactical targets of RRC Focus Distribution besides development and securing of partners' channel, we could mention keeping and development of the leading positions in all the current spheres of our operations, development of repackaging and assembling initiatives for strategic vendors. Search of new perspective products and technologies, which could in the 3-5 years to come become one of the major constituents of RRC Focus Distribution business, is also a division' s priority.

RRC Enterprise Networking deals in delivery of equipment for building networks of various integrity level requiring a high level of a technical expert appraisal. The company deals in capital-intensive equipment: its manufacturing, distribution, and use are associated with long-term and large investments. Value of this equipment can be fully realized only by specialists.

Among tactical targets of RRC Enterprise Networking we could single out the following:

    - broadening the product line in all the countries in order to provide partners with most wide range of networking equipment,
    - keeping stable and gaining leading positions in equipment sales of all the strategic vendors,
    - promotion of most perspective technologies.

Personnel of the company does not only have profound understanding of the market and partners' needs, but also expert knowledge in the sphere of forming optimal product portfolio and effective search of most up-to-date technological solutions. Long-term business relations with a considerable number of vendors allow us to train qualified personnel and, accumulating necessary information, to form a base of expert knowledge that is most valuable in the sphere of supplying equipment for integrated network solutions.

Successful operations at different international markets, unique as far as supplying equipment for solutions is concerned, contributes to our expertise and makes us really different from our competitors. We have managed to generalize and formalize our experience of selling networking equipment, having implemented the schemes of internal logistics and financial control, that make our cooperation with partners more effective and profitable.

Activities of RRC Consulting Services can be logically integrated into the company's chosen scheme of value added distribution, allowing to solve a number of issues necessary for the company's development as a whole, at the same time increasing the value added constituent of the business by increasing the number and improving the quality of the services we offer to our clients. RRC Consulting Services will sell services to RRC group, RRC partners and end users. RRC Consulting Services will extensively attract external resources using the outsourcing principle.

According to Konstantin Sidorov, RRC President, "it's most important that the new strategy was accepted well by the team, since aiming at achieving common, clear targets secures its successful realization". He also pointed out that " having familiarized themselves with the strategy, representatives of our business partners Ernst & Young and KPMG highly estimated it."

For additional information, please contact RRC marketing coordinator Irina Vysotskaya (+7 095) 956 1717, irina_v@rrc.ru