Advantage head focuses on solid history

Friday 8th June 2001

TURNAROUND AGENT: Tony Bradley

By Deborah Hill Cone

Advantage Group's new managing director Tony Bradley is going to be making big changes at the troubled technology company - he's just not quite sure what they will be yet.

In his first interview since starting the job Mr Bradley told The National Business Review he was not trying to defend the poorly performing company's past, just trying to fix it.

The tech veteran - he knows how to write antique Cobol code - will be taking a back-to-basics approach but does not pretend to know what that will be.

NBR: "So are you clear about Advantage's new strategy?"

Mr Bradley: "No."

On Tuesday, his first day in the job, Mr Bradley said he was starting what's known by consultants as an "as is" assessment - in layman's terms that means looking at how deep in the schtuck you are.

On Wednesday, his second day, he announced a management buyout (MBO) of Glazier, the Wellington part of the company's problem child e-services business.

It had been acquired by general manager Tony Stewart.

"This is consistent with our stated intention of aligning our e-services business model with market conditions," a press release from the company said.

Translated, this means the e-services section, cobbled together from a string of acquisitions unwisely made at the height of tech hysteria, has been a dog.

That was only Mr Bradley's first two days - expect more changes aiming to turn around the troubled company when Mr Bradley finishes the overall review of the e-services division.

The other three divisions - payment solutions, retail automation and portable technology - are more solid businesses that have grown out of Advantage's roots as a payment company.

Mr Bradley several times repeated a mantra: "This was a sleepy $15 million company. Now it's five times that size and has grown dynamically," Mr Bradley said.

"It takes a while to rebuild confidence [in Advantage] - that starts with me."

But analysts say Mr Bradley is a brave man to take on the job:

The company's share price is in the doldrums - shares were trading at $0.76 on Wednesday, down from the year high of $5.65. With $54 million in goodwill aside, the company's book value equates to 0.19c per share.
Staff morale has been under pressure with about 120 staff leaving in the past six months including key management figures such as Mark Stobbs and Andy Wilkinson.
Advantage is still suffering from a public relations debacle over the staged release of its last annual result.
Investment bank Credit Suisse First Boston touted the company overseas for six months but found no takers.

At the time former chief executive Greg Cross announced his resignation he said the company needed a process-driven executive, someone who liked the "nitty gritty."

UK ex-pat, now a naturalised New Zealander, Mr Bradley fits the bill. He is a solid manager with a CV that includes turning around a loss-making NCR as managing director in the mid-1990s and running AT&T's New Zealand operation.

Most recently he has headed an e-business consultancy team at Deloitte. "My bottom line is that in IT I do not think there is such a thing as a sustainable competitive advantage - only good people."

He was not sure whether the churn of staff had had a material input on the business since it had taken a new direction - the company still has 400 staff.

"I think the staff had some good positive vibes this morning - they have been living in a vacuum," Mr Bradley said.

Mr Bradley met with key investor Eric Watson before taking the job but received no assurance Mr Watson was not planning to sell out of the company.

"It's a dynamic company and there could well be changes," Mr Bradley said.

He would not disclose his salary figure, saying some paperwork still had to be signed, but revealed a significant part of his remuneration will depend on the company's success.

In response to questions about Advantage's lack of credibility in the market, Mr Bradley said he plans to "implant his values" of integrity and a belief in "doing what's right" in the company.

Since Advantage's embarrassing annual result blunder it has swapped PR firms - aggressive technology-driven Botica Conroy is out, blue-chip Consultus is in - as it tries to turn itself from a gung-ho surfer of the high-tech wave into a sober, solid listed company.

Advantage's share price did not react to this week's MBO of Glazier: 0.76c on Wednesday.

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