As we close in on the end of 2010 it seems fitting to look back at the year and reflect on some of the things that I have seen, especially in light of another difficult global economic climate. I suppose my main observation will seem obvious; that the world is not all equal, especially in the world of commercial records management. Here are a few of my observations from the different global markets:In North America, I have witnessed an increase in activity on the acquisition front, with more companies saying that they are actively seeking acquisitions, or plan to make acquisitions in the near future. So what is fueling this desire to buy/sell? I believe it is two-fold: Firstly, I think that many independent companies have reached a size where they feel it’s time to exercise their exit strategy. With employee costs on the increase, inflation rumored to be on the horizon, and the constant media attention pointing to a rise in electronic records (and therefore an assumed decrease in “traditional” physical storage) maybe the time just looks right for many independents to sell. Couple that with the fact that many other companies seem to be buoyed with equity money flooding into the industry along with their urgent desire to spend that money, and the phone hasn’t stopped ringing at the independents in 2010. Now this may all seem alarming to the uninitiated, but this has been a natural part of the commercial record management industry forever. Independents are the pioneers who break out into new markets (the so-called green-field sites) and the larger companies come along with bags of money when they can see a successful opportunity. This consolidation has always created opportunities for new entrepreneurs (or those returning with expired non-compete agreements) to enter a market with new ideas and new visions for the industry. It is this regeneration that makes this an exciting industry that will continue to grow and be successful.
In Latin America, on the other hand, I am seeing what I refer to as a professionalizing of the industry (see my blog titled The Professionals to explain my use of this term). It may surprise many to learn that some of the biggest, and arguably best commercial record centers exist in these markets, and to continue their growth they are introducing new software, management structures, partnerships, and visions. Document management is a mainstay of many of these commercial record centers, in volumes not usually seen in companies in their North American neighbor. Each country is a little different but the trend is the same across them all. Expect to hear a lot more from this growing region in the coming years.
In Europe, to me it has been much more “business as usual”. I was expecting to see more acquisitions, as in North America, but they didn’t really come to fruition. Businesses appeared to continue to focus on their core strengths, with the addition of some exploration into the offering of digital services. Europe does not appear to being driven as hard by media speculation over the “paper-less office” and so traditional commercial records management is still considered to be a very important part of the Records and Information Management (RIM) requirements. I think the one thing that has most encouraged me about the industry in Europe has been the camaraderie of “competitors” clearly seen on our user forum and at trade shows. We all live in a competitive environment, but to see how our customers (and the industry as a whole) pull together in Europe is wonderful to see.
As we continue our globetrotting retrospective to Asia, I have to say that the market where I have seen most disruption in 2010 has been India. In an industry that needs to focus on providing high levels of services, it has been unfortunate that many companies have taken the commodity approach of selling “cheap storage” over “records management”. There are many excellent companies in India that have invested heavily in their business, in order to offer a first-class service, but the buyers of the services are still not educated to the important differences between storage and management. It is very important, therefore, that we all continue to produce articles and blogs, and any other marketing collateral we can, to help our industry colleagues in India educate their clients and potential clients to the importance of engaging with professional commercial records management companies. I hope the government there also gets involved, as regulation is needed and would help the industry. Over time, the message of governance will resonate through to the buyers of services, and then we can watch these entrepreneurial companies grow to their true potential.
So a quick tour of the globe lets us see that the commercial records management industry is very much alive, but facing different challenges depending on your geographical location. Each challenge will be taxing to those involved, but the end result will be a stronger industry that will continue to play an important part of the RIM lifecycle for the next decade.
I am more excited than ever to be involved and look forward to being a part of your successes in 2011 and beyond.
May I take this opportunity to wish you all a very happy holiday season and a prosperous New Year.
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