Strategic Report
Our Strategy for Sustainable and Profitable Growth
solutions by stc’s IPO was a milestone achievement for the Company as it generated record-breaking demand from domestic, regional, and international institutional investors with c.130x oversubscription.
- It was one of the largest IPOs on the Saudi Stock Exchange.
- Despite the complexity and size of the offering coupled with fluctuating market conditions, the offering was successfully completed in an accelerated timeline compared to other Saudi IPOs.
- An analysis of share performance demonstrates significant demand from corporates and share allocation reflects the same.
Our growth context
Today, the omnipresence of ICT and digital solutions is felt globally. Studies have shown that enterprises across the world hope to achieve digitally-fueled growth while companies have increased spending on IT solutions – the most notable increase was in 2021.
Moreover, the reliance on IT became more pronounced since the outbreak of the COVID-19 pandemic. Most businesses and industries across the world had to digitize processes and fine-tune their operations in order to keep pace with the rapidly changing requirements of a growing number of digital citizens.
Long before the outbreak of the pandemic, the Kingdom of Saudi Arabia embarked on a journey to digitize the Kingdom. Saudi Vision 2030 Vision 2030 – the Kingdom’s strategic framework for broader development – has put the KSA on the path to shifting reliance on oil and converting the Kingdom into a digital hub.
Fueled by Vision 2030, the Kingdom is reported to have the largest and fastest growing ICT market in the GCC. The market is quite sizable even when compared to other mature global markets and the trend for future growth is remarkable. The trajectory of growth for the ICT market in the Kingdom demonstrates steady growth across all ICT related business lines with the demand for systems integration being the topmost requirement.
Among the key drivers in the market are system integration for smart cities and other large-scale enterprises; digital solutions for better integration of operations within factories, healthcare, and education; data center and cloud for better management of data for enterprises adopting a work-from-home culture due to the pandemic; equipment services for the digitization of medium sized businesses; application services for the digitalization of processes in government and private enterprises; Cybersecurity Integration for increased security of data in banks and other pivotal organizations; and managed networks and infrastructure for multivendor environments that require 24x7 monitoring.
In an effort to keep pace with the latest trends, businesses from all sectors have increasingly adopted digital solutions into their operations. Despite the challenges brought on by the COVID-19 pandemic, businesses across the Kingdom began to invest more on integrating their systems and embracing digital solutions to reach their stakeholders who were confined to their homes.
We operate within this dynamic environment and each emerging trend is reflected in our business lines. The key drivers in the market and the enterprises that require these solutions are also among our product and customer portfolios.
Our strategic journey
Since the start of our operations, we have been guided by strategies that have taken into consideration the business context, the solid relationships built with our parent, stc, our shareholders, stakeholders, and our growing partner ecosystem. We believe the strategies we adopt contribute towards their growth and align with their visions.
Over the years we have focussed on different aspects and paces of growth that have been captured below:
We have achieved some critical strategic goals in our journey so far. During Horizon One (2007-2014), we focussed on “starting right” by putting in place suitable systems and processes while also hiring individuals who are experts in the field. Next, we moved onto Horizon Two (2014-2019), a time of “rapid growth”. During this period, we expanded our products and services and attracted partners and businesses throughout the Kingdom.
Our 2020-2025 strategy
Today, we are in the “stable growth with strong profitability”, Horizon Three of our strategic journey. Our strategy is to increase market share and maximize shareholders value by focusing on high growth segments and categories, by expanding portfolio and market reach, by enhancing customer experience, and developing and attracting the best talent. These goals are propelled by the objectives set out in our LEAP strategy revolving around the following areas:
Lead in managed and professional services
To achieve growth of our business, we have current and planned initiatives to focus on strengthening our market position in managed and professional services, and business process outsourcing markets, with a view to nurture customer relationships throughout the IT value chain, strengthening our competitive position in the market.
In order to reinforce our leadership position in managed and professional services (including integration, customization, development and management), we are focused on strengthening our offerings by leveraging best external technologies, optimizing and improving our existing offerings through continuous enhancements in our capabilities.
Expand product portfolio and market reach
We are actively seeking to expand into new and adjacent business lines linked to our current business in order to meet the evolving needs of our customers and further enhance brand equity, as an innovator in the market. We carry out comprehensive assessments of needs of businesses and market trends in order to identify opportunity areas to
venture into, addressing customers’ end-to-end IT needs.
With these initiatives for expansion and diversity of portfolio with high margin products across IT, digital and emerging technologies, we intend to grow organically and inorganically in KSA and beyond. Our aim is to address the future needs of our current and potential customers; which will further diversify our customer base into segments and verticals including small and medium enterprises.
By further focusing on these areas, we are aiming to support our cross selling and upselling efforts as well as bundled offerings, – move comma to the end of this section. in order to maximize shareholder value and leverage our position as a major end-to-end ICT services provider in the Kingdom across business lines.
Advance customer success and partner ecosystem
Individual efforts only go so far, and we believe in winning with our customers and partners. We seek to develop and maintain a strong partner ecosystem, fostering effective working relationships with our suppliers in order to meet the evolving needs of our customers. Building on and maintaining relationships with global technology vendors, such as international hyper-scale cloud providers and technology providers, represents an essential element of our
go-to-market strategy, where we enable our foreign partners to access the Saudi market.
Moreover, we have a strong focus on delivering best in class customer experience to our clients by implementation and continuous improvement of total experience focusing on customer centricity, shareholders, employees, and partners experience.
Promote internal efficiencies and collaboration
In order to achieve our aspirations and objectives we consistently aim to create efficiencies within the business and streamline existing processes. We actively seek to cultivate synergies within the business and maximize transparency within the company with the aim of improving our broad operational capabilities, maximizing our shareholder value.
Initiatives currently in place revolves around enhancing internal operating models, further increasing automation of internal processes, and optimization of investments in internal capabilities buildup and resource management.
We believe in being ahead of the curve, constantly innovating and being in tune with our customers’ needs. As we venture forward, we hope to be recognized as a company that is enabling technology and the aspirations of those who become a part of our network. We hope to grow sustainably, by establishing more fruitful partnerships, diversifying our portfolio, and improving our internal processes. The strategy we follow for the next few years will propel us and help us ‘leap’ beyond familiar terrains.
