Role Model
The Grand Old Man of IT Channels
Anil Gupta, the Managing Director of Artek Enterprises, pioneered the IT channel business in India. Today, at 54, he is still brimming with ideas
By Sharmee Roy
In the 30th year of the company’s operations, Anil Gupta, Managing Director, Artek Enterprises, can truly be called the Grand Old Man of IT channels in India. Over these years Gupta has witnessed—as well as been a part of—a revolution that still continues to engross him.
This farsighted businessman was one of the early entrants in the market and found his way even when the concept of channels did not exist. Even after having been there and done, that his humbleness keeps him grounded.
“I would like to be remembered as someone who helped spread technology to customers and made it an integral part of their success ladder,” says Gupta.
 Launching pad
It all began in 1979 when Gupta plunged into the industrial electronics business soon after finishing his MBA. He set up Artek Enterprises in partnership with two of his friends. Together, they made an investment of Rs 4.50 lakh in the business.
“We started with industrial electronics because back then the IT market was only about mainframes. But I was always passionate about IT right from my college days, and had always planned to get into the IT business. It was all about waiting for the right opportunity,” reminisces Gupta.
The opportunity came knocking in 1981 when IBM launched the PC, and then in 1985 when Gupta entered the IT business. The company started off with networking products, especially modems. At the same time, the company also started its sub-distribution arm with Epson printers.
Artek’s first major break came in 1989 by way of a contract for setting up a 300-node LAN for the National Informatics Centre.
“One of the major buyers at that point of time was the government, so we started focusing on the government. The NIC project was a big challenge for us as we had not done any project of this stature before, but at the same time it gave us the opportunity to do something new. It gave us immense confidence,” recalls Gupta.
After that there was no looking back. Artek soon won a deal worth Rs 19 lakh to set up a LAN network for the ordnance factory at Kanpur. This was followed by prestigious projects to network Rashtrapati Bhavan, the PM’s office, and various ministries.
Having established Artek’s track record in the networking solutions business, Gupta turned his focus to sub-distribution. By early 1990 the company decided to realign its business to shift its focus completely to networking for both its business arms.
“With government projects flowing in we realized that peripherals were something we did not want to do because the margins were low, hence we decided to drop printers from our portfolio,” explains Gupta.
This realignment also set the stage for the next big leap for Artek when it entered into a distribution tie-up with D-Link for the northern belt. In 1993, the company became only the second distributor to be appointed by the vendor in India.
Solutions mix
The last fiscal saw the company register a turnover of Rs 100 crore, of which 55 percent came from network integration. Having grown at the rate of 35 percent over the last two years, the company attributes its growth in the solutions business to its focus on the government.
Says Gupta, “Government and PSUs have been the mainstay of our business right from the beginning, and today they contribute about 40 percent to the solutions business. Even during these times this segment has only grown for us.”
One of the major projects undertaken last year in this space was the computerization of 550 remote sites for ticketing for West Central Railway, Jabalpur. The entire project was worth Rs 4.80 crore.
Similarly, it also did a project for HQ 16 Corps, Jammu, amounting to Rs 4.64 crore. The project involved the setting up of UHF links as a back-up to an optical fiber communication network in remote terrain.
Artek is equally bullish about opportunities in the education market. “We did a project for Aligarh Muslim University where we set up a complete campus network of over 2,000 nodes, including core switches, Giga routers, Wimax connectivity to satellite campuses as well as a firewall for the network,” says Gupta. The entire project was worth Rs 9.66 crore.
On an average, the company is able to sign up 200 projects every year.
Sub-distribution mix
With 45 percent of the revenue contributed by the sub-distribution business, Artek is as focused on it as on the solutions business. Having a strong foothold in the entire north, the company has been looking to expand operations to the east and west. The company is also expanding its portfolio in a way that complements its focus on networking distribution.
“We entered the eastern market with branches in Kolkata and Shillong. We also moved into the western market with our branches in Jabalpur and Bhusawal. And last year we strengthened our product portfolio with the addition of access control products and surveillance products like CCTVs,” informs Gupta.
Currently working with 1,000 resellers in the market, the company helps them in identifying their key strengths and provides them with technical training on network design. Explains Gupta, “This helps them focus on specific product lines. Additionally, we support them with joint calls, and in cases where they are unable to invest we go ahead and execute the cases on their behalf.”
To motivate its partners, Artek also runs special schemes and promotional offers with a special focus on upcountry resellers.
Systems and certifications
It is important for any growing organization to put systems in place to drive efficiency, and Artek took the first step in this direction in 1988 when it achieved ISO 9001: 2000 certification, making it one of the most respected players in the market. “The certification helped to project ourselves as a highly systematic company,” recalls Gupta. Then in 1999 Artek put in place customized MIS databases and reporting systems. Comments Gupta: “These helped in tracking sales performance on the product side, as well as dealer-, reseller-, SI-, and geography-wise performance. It also helped us monitor the performance of our executives.”
The company went a step ahead in 2000 and implemented Tally for inventory management. It is currently considering various vendors for an ERP solution which will be implemented this year.
With 152 employees, Artek organizes weekly in-house technical as well as sales training. It also keeps employees motivated through incentives for achieving specific targets.
Adds Gupta, “We give salary increments to our employees on acquiring new skill-sets as well as certifications. We already have 30 certified employees in the company.”
Game ahead
With a target of achieving Rs 500 crore in turnover over the next five years, the company plans to set up a branch in Pune in the next three months. Already having a strong presence in the north, Artek’s aim now is to set up a countrywide presence.
“We have a strong presence in the north with 86 percent of our business coming from this region; our aim is to reach out to markets across the country. To this end, we will go ahead with our plans to move down south next year because it is the only region that has not been addressed by us so far,” reveals Gupta.
On the product side, the plan is to add new products that would complement its existing product line. “We are keen on tying up with more principals. This could be on a case-to-case basis, or on a long-term partnership basis with a focus on Wimax and the security business because they are complementary to our existing line of business. We are keen on bringing in more products on the wireless side, whereas on the WAN side we are looking at synchronous digital hierarchy equipment. On the security side we will continue to focus on access control products,” says Gupta.
He also plans to forge alliances with more resellers in the market. “This year we will increase our partners with 30 percent more resellers to help us reach out to more markets.”
Behind the scenes
The man doesn’t believe in looking up to only one person, but rather draws his inspiration from the various people he comes across.
“While working on government projects I came across various government officials, and it was so inspiring to see the enthusiasm they had about technology. This made me realize that nothing is too difficult if you just channelize your efforts into it,” Gupta explains.
His world revolves around his friends, but he barely manages to spend time with them. That is why he has now decided to go on a Scandinavian cruise with his group of friends. “I had been longing to do this and spend time with my friends like I used to back in college. I guess now is the time to relive those days with them again,” smiles Gupta.
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