Ingram Micro merges North American operations

Beginning in 2002 Ingram Micro Canada will have a distinct American flavour to it, while the U.S. operation will be slightly more Canadian.

The distributor, based in Santa, Ana, Calif., Monday announced that the U.S. and Canadian regions will no longer be run separately. It also made management changes that will see its top executive, Kevin Murai, regain authority over the Canadian operation.

Asger Falstrup will stay on as Ingram Micro Canada president during the transition phase before he heads off to Miami to take over for Jorge Reyes, president of the Latin American region. Reyes will stay on as vice-president finance and accounting.

The Canadian executive team will remain intact and will continue to have the same authority it enjoys today, Murai said.

Murai, who led the Canadian team for about a year before he was promoted to the distributor’s U.S. presidency, said this restructuring will not result in layoffs.

“This is absolutely not based on consolidation purposed in the negative sense. The move is a proactive step on our part to be able to continue to invest much more and drive the kind of go-to-market programs and services that IT manufacturers are looking for,” Murai said.

“If you use (the word consolidation) then you have to follow it up with consolidation of intellectual property,” said Dave Walsh, vice-president of sales and marketing for Ingram Micro Canada. “The thoughts and the creative ideas that we have from a sales and marketing perspective we will try to bring together, whether you talk about SMB (small and medium business) focus, or the VentureTech strength that exists in the U.S., or the new business development areas.”

The merger of the two regions, which was discussed between Murai and Falstrup for the last six to nine months, is an effort to merge best practices, share developmental costs and services, and to pursue joint purchasing agreements. The moves will be complete by early January 2002, the company said.

“They’re trying to find a way to cut costs, and in their business that’s an important thing to do, but they have to make sure they don’t lose focus on the Canadian market,” said Paul Edwards, channels analyst at IDC Canada in Toronto.

Edwards said it was too early to gauge how the restructuring would affect Ingram’s relationships with its Canadian channel partners.

“They could drop the ball there, but that’s their business,” he said, adding that many Canadian VARs were concerned by the financial misfortunes of Merisel before its Canadian operations were sold to Synnex. “The resellers don’t want to see any other distributors go under because it’s better for them. If you only have two, it’s a lot harder to play one off the other.”

For Murai, the merging of the two regions into a North American region mirrors what the distributor has done in Latin America, Europe, and Asia-Pacific.

“The entire team recognizes that there are differences in how you approach local markets,” he said. “Even picking an extreme example of Texas and Quebec is valid, but you can do the same in Canada between Vancouver and Quebec. We will always recognize that there are differences in the way we approach local markets. What we are really talking about is where you have broader strategies or best-of-breed solution strategies on things like high-end storage and how we resource that, how we roll out our whole service provider exchange in the U.S. and how can that be translated into Canada.”.

Falstrup, 51, came to Ingram Micro Canada in February of 2000 after three years as vice-president of Ingram Micro Nordic Region in Copenhagen. Murai, 37, has spent a dozen years at Ingram, starting out as MIS manager before moving up the ranks when Gord Schofield left the company in late 1997.

Murai oversaw a significant expansion of Ingram’s presence in Canada, including the construction of its current 470,000 square-foot office and 50,000 square foot warehouse. Falstrup, meanwhile, steered Ingram Micro Canada through some of its most difficult moments.

While his tenure included a number of acquisitions, including most of the product-oriented side of GE Capital ITS and the hardware assets of Beamscope, the IT industry downturn led to the layoffs of at least 40 sales associates at Ingram Micro Canada in June. Falstrup was trying to turn things around by streamlining processes within the sales organization, primarily through e-commerce activities. The Ingram Micro Pipeline, for example, which allows resellers to get producing and SKU numbers through its mainframe database for their own Web sites, has been adopted by more than 40 Canadian VARs.

“First and foremost this makes a lot of sense,” said Falstrup. “I have been happy up here in Canada for two years of my life. I am grateful to work with such talented people in Ingram Micro Canada. But for me it is time to move on, and I am also very happy to be offered the position of president of Latin America because I see certainly the experience I have attained in Europe and from Canada can turn into an asset for the Latin American executive team.”

Like the former Merisel Canada (now Synnex) Ingram Micro Canada typically outshone its corporate parent. In its first quarter earnings report, for example, Ingram Micro said operating losses from its developing Asia-Pacific region were offset by strong operating results from Canada and Latin America.

With files from Shane Schick.

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