Siemens Deal: The Enterasys PerspectiveSiemens Deal: The Enterasys Perspective

During this morning's Siemens press conference, Gores Group representatives stressed their track record in turning around technology companies, citing as a prime example one of the companies that will be part of the new Siemens Enterprise (SEN) joint venture: Enterasys. I just had a chance to talk with Enterasys CEO Michael Fabiaschi, and I started by asking him how Gores group turned Enterasys around and made it profitable.

During this morning's Siemens press conference, Gores Group representatives stressed their track record in turning around technology companies, citing as a prime example one of the companies that will be part of the new Siemens Enterprise (SEN) joint venture: Enterasys. I just had a chance to talk with Enterasys CEO Michael Fabiaschi, and I started by asking him how Gores group turned Enterasys around and made it profitable.Fabiaschi, who took over Enterasys less than 2 months after Gores acquired the networking vendor, said the first priority for the new leadership was to "make sure we took care of the customer base." That meant emphasizing customer support and investing more money in R&D. So the top priority was making sure existing customers were referenceable and well taken care of.

Fabiaschi also noted that the new leadership "took out a lot of middle management," and focused its marketing efforts on lead generation and revenue generation over branding. Enterasys had been able to win deals it got in on, he said, but "We weren't getting in enough deals."

Now, there are probably as many differences between Siemens and Enterasys, pre-acquisition, as there are similarities, and Fabiaschi stressed, "I do not pretend to be knowledgeable about Siemens" to the extent that he would prescribe which steps the new owners should or will take.

In terms of the products and technologies, Mike Fabiaschi noted that Enterasys has been working with Siemens voice products since 1998, and that at this year's CeBit show, the companies showed an integrated Enterasys-SEN solution for location services and identification services.

Fabiaschi said open interoperability is a critical value for both Enterasys and Siemens, which also makes the companies a good fit. He acknowledged that the new JV may create something of a "tightrope" as Enterasys continues to interoperate with other voice vendors' solutions, even as it's absorbed into the SEN JV. He noted Enterasys's partnership with ShoreTel and said he intends to "make sure we are a good partner to ShoreTel" going forward.

As far as sales opportunities, Fabiaschi said 45% of Enterasys's revenues come from North America, compared with just 5% of SEN's, and he expects the JV to leverage this "rock solid customer base" for SEN's products. (In her No Jitter post, Sheila McGee Smith reports that Siemens' Thomas Zimmerman said he expects Siemens to avail itself of Enterasys' North American channel.)