Absorbing Catena and becoming Systena (2010)

The danger of having one customer

One can read this merger as a reversal in which the smaller side swallowed the larger. Following the disclosed sequence, though, the reversal itself does not look like the objective. System Pro’s problem was not its growth rate but the structure in which a quarter of sales was held by a single company. In a business where revenue grows as engineers are added, the pace of hiring is set not by your own judgement but by the customer’s development plan. Raising the shareholding over three years and finally proceeding to a merger can be seen as the sequence required to undo that dependence.

Even so, the air thin-client service put forward as a reason for the merger stopped being described as a pillar of the business afterwards. What actually told was not the new venture explained as a concept, but the financial-sector customers the old Catena held and the sales force that sold to them. The gap between the stated rationale and what proved effective in hindsight reveals the character of this decision. Given that a company which broke its concentration on one customer has, in the 2020s, chosen a new concentration in next-generation mobility, the question of whether to lean toward specialization or toward spreading customers keeps returning to this firm.