Customer Solution Case Study
/ / International Security Provider Finances Its Future with Total Solution Financing
Overview
Country or Region:Belgium
Industry: Other Professional Services
Customer Profile
Securicor, the international security solutions group, is a globally recognized security provider. Securicor Netherlands employs 4,500 people in 15 regional offices throughout the Netherlands.
Business Situation
The old The old enterprise resource planning (ERP) system was a patchwork of several software packages connected through a variety of different interfaces. Securicor Netherlands needed a system that was more sophisticated and could handle its complex work processes but also one that was seamlessly integrated.
Solution
Although it had traditional financing in place, Securicor Netherlands was attracted by the benefits of Total Solution Financing from Microsoft Capital Corporation, which gave it all the benefits of investing in a new enterprise resource planning (ERP) system without having the impact on its finances.
Benefits
Smooth credit approval process
Benefit now, pay later
One contract to cover entire project
Retain cash reserves for other investments / “We have already had several calls from sister companies to hear about Microsoft Axapta and Total Solution Financing and, based on our experience,
we would definitely recommend it.”
Philip Limvers, Finance Director, Securicor Netherlands
Securicor Netherlands had outgrown its old enterprise resource planning (ERP) system. When it chose Microsoft Business Solutions–Axapta, it didn't realize that not only was the company getting a new flexible and integrated ERP system, but it would also be able to finance it in affordable monthly payments.
Total Solution Financing from Microsoft Capital Corporation has meant that Securicor Netherlands can get the benefits of a new ERP system now but pay for it over three to five years. This means Securicor Netherlands can keep cash reserves and invest in other critical assets or it can preserve capital for emergencies. Total Solution Financing combines all hardware, software, and services into a single contract and invoice, making it remarkably easy and efficient for Securicor Netherlands to keep track of its financed and leased assets.
Situation
Securicor Netherlands employs 4,500 people, providing a wide range of security services. It is part of the Securicor group, a globally recognized security provider, which operates in 50 countries and employs more than 100,000 people within the fields of manned security, electronic security, cash services, and justice services. Securicor Netherlands has 15 regional offices across the Netherlands and is one of the leading security providers in the Netherlands.
Securicor Netherlands needed an upgrade of its enterprise resource planning (ERP) system. It had a 10-year-old ‘patchwork' of software packages, some of which were connected through a variety of unreliable interfaces and some of which simply operated alone.
The company's expanding business required something more sophisticated: a system that could handle complex contract management for customers as well as complex labor agreements for employees who often work unusual hours. The new technology, which would be made up of several complementary units, would also have to give the impression of being one system with a single, user-friendly interface.
Securicor Netherlands looked at a range of enterprise software systems but the pitch made by Microsoft® Business Solutions Partner Watermark stood out from the rest. Watermark recommended Microsoft Business Solutions–Axapta® core modules with bespoke software to handle Securicor Netherlands' specific needs. Philip Limvers, Finance Director with Securicor Netherlands, had agreed to the nuts and bolts of this implementation with Watermark when the request came through to discuss Total Solution Financing from Microsoft Capital Corporation. The rest, as they say, is history.
Solution
"I agreed to discuss financing simply as a matter of courtesy," recalls Philip Limvers. "We had already agreed to traditional financing for our Microsoft Axapta implementation from our ‘house' bank when Total Solution Financing was made available in the Netherlands. However, things changed rapidly and two meetings later we were signed up. The bank wasn't too happy but that's life," he says.
As Finance Director, Limvers played a key role in assessing the merits of Total Solution Financing, which provides secure upfront, fixed-rate loans backed by Microsoft Capital Corporation, a new Microsoft business division specializing in financing technology investments. Instead of traditional collateral, Total Solution Financing accepts software and services as intangible assets.
Total Solution Financing covers all of the costs associated with Securicor Netherlands' Microsoft Axapta implementation up front. This includes the cost of software and hardware installations, such as Microsoft Office XP and SQL Server, maintenance, upgrades, and consultancy costs. Instead of the traditional cash up-front expense, Securicor Netherlands will pay small amounts each month over three years.
"The advantages of Total Solution Financing were immediately very clear. The fact that our planned Microsoft Axapta implementation itself would be used as collateral was the main selling point," Limvers says.
"Banks don't appreciate the value of software the same way Microsoft does. They want tangible assets as collateral; Total Solution Financing accepts the actual IT system as collateral. Our Microsoft Axapta implementation is crucial to our business but it is not a core element of what we do. Total Solution Financing allows us to finance the implementation over three years, including licenses and third-party software, without us having to touch our ‘savings' as it were."
"This was a head-to-head between traditional financing and Total Solution Financing, and the latter won," says Eric Biekart, Chief Financial Officer with Watermark, the Netherlands. "The fact that the name Microsoft is attached to Total Solution Financing was important – it made Securicor Netherlands feel more confident in what was a new concept to them. They also liked the idea of getting finance for their technology projects from a company that understands technology," says Biekart
Benefits
Smooth Credit Approval
Microsoft Capital Corporation's credit approval process was ‘very smooth' according to Limvers, taking less than a week. Securicor Netherlands was even able to adapt the contract in some areas to suit its requirements. "We had concerns about some elements in the original contract but we talked it through and ironed out the problems. As a result, there is a contract in place that every subsidiary of Securicor around the world can use. We have already had several calls from sister companies to hear about Microsoft Axapta and Total Solution Financing and, based on our experience, we would definitely recommend it."
The financing solution agreed upon by Microsoft Capital Corporation and Securicor Netherlands is based on an estimate of the cost of the implementation including software, implementation, licenses, and so on, payable over three years. The estimate includes a 30-percent safety margin to cover future expansion, new add-ons, and even licensing costs.
One Contract to Cover the Entire Project
Total Solution Financing consolidates all of the costs associated with Securicor Netherlands' Microsoft Axapta implementation, including third-party software and consultancy fees, into one contract and one monthly payment. "While there are add-ons, we wanted to deal with it as one system and not get caught up between vendors. So, we are letting Watermark handle the entire project including the outsourcing. Why not? It's not our core business. We just want a system that works," Limvers says, laughing.
An Investment in the Future
By turning a traditional ‘cash up-front' investment into easily managed and affordable monthly payments, Total Solution Financing leaves Securicor Netherlands free to invest in what it does best: provide security solutions.
"We still have cash to sustain our core business and if we decide to expand or acquire new business, all our credit facilities are still intact with our bank; we are free to use our assets for loans against core business investments. We have invested in the future of our company without impacting our current financial strength. We can have our cake and we can eat it too," concludes Limvers.
Microsoft Business Solutions
Microsoft Business Solutions offer integrated business applications and services that allow small and midsize organizations and divisions of large enterprises to connect employees, customers, and suppliers for improved efficiency. The financial management, customer relationship management, supply chain management, and analytics applications work with other Microsoft software, including the Microsoft Office System and the Windows operating system, to streamline processes across an entire organization. This gives businesses insight to respond rapidly, plan strategically, and execute quickly. Microsoft Business Solutions are delivered through a worldwide network of channel partners that provide specialized services and local support tailored to a company’s needs.
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