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Tue 16 Sep 2008 04:00 AM

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Market mentors

The IT training provider sector in the Middle East is soaring high on the back of regional technology growth. Yet, as Channel Middle East finds out, there is more to operating an effective learning business than meets the eye.

The IT training provider sector in the Middle East is soaring high on the back of regional technology growth. Yet, as Channel Middle East finds out, there is more to operating an effective learning business than meets the eye.

In an industry obsessed by quick returns and high volumes, the independent IT training provider segment doesn't really appear to fit the mould. Intellectual property and knowledge transfer compose the primary engines of this burgeoning segment, which means patience is a virtue that training firms require in abundance.

"US$500,000 is maybe enough to start up a good training provider, but the challenge is not the physical aspect of buying the equipment, it is more to do with the intellectual investment," explained Ajay Singh Chauhan, CEO at Spectrum, a training provider specialising in Juniper, Foundry, Kaspersky and ArcSight courses.

It is not a market that the big players want to enter because although the investment wouldn't be a problem, the reality is that you will never become a US$100m company from training.

"It can take between six months and one year by the time you have hired the right person and they have become authorised to run the training courses."

Although it remains a vastly understated sector of the market, IT training ostensibly makes the technology wheel turn by ensuring individuals and corporates are clued up on the latest hardware and applications.

Organisations that deliver training courses are effectively knowledge aggregators, facilitating the information flow from vendor level all the way down to the channel and end-users.

Most training providers generate business from three sources: end-users that want their staff educated in specific IT practices or technologies; resellers that need to get their sales and technical staff up to scratch; and vendors that require employees to be taught the crux of their products. Some Middle East providers serve all three customer sets, although corporate end-users generally constitute the bulk of business for most.

That said, the relationship between the reseller channel and third-party training providers has always been close, with vendors pushing their channel allies in the direction of these companies to attain expertise. New Horizons, a US-based outfit with established learning centres throughout the Middle East, cites reseller training as an important component of its business.

Mohammed Aslam, general manager at the company's Dubai-based office, insists formal training ensures IT dealers develop the skills to complement their market experience.

"Resellers need their selling and technical support personnel abreast with technology so that they understand the extra value of it and how it all integrates together," he explained. "They require our help to get their people trained and out in the market signing up the enterprise deals," he added.

Foundry Networks, which requires certified network engineers to be reaccredited every two years, believes the standard of technical education determines a good training partner.

"We want our end-customers to be completely confident that their technical needs are being met regardless, whether it is an internal Foundry employee or a reseller systems engineer," explained Middle East regional manager, Farook Majeed.

"In addition to the quality of training, appropriate geographic reach in the training partner's region is important. We want our global resellers and customers to have access to the training wherever they are located."

In the Middle East there are purported to be more than 15 renowned training providers offering courses comprising everything from Microsoft Office to the implementation of Cisco intrusion prevention systems.

Market spectators estimate the organised IT training market is worth anything between US$12m and US$20m in the UAE, but that doesn't really give any indication as to the overall expenditure on IT training that occurs.

Many vendors provide training during the implementation of projects, while manufacturers such as HP focus more on their own educational services divisions rather than outsourcing to third parties.

One thing for certain is that operating a successful training business requires diligent human resources management. Synergy Professional Services, which was acquired by US-based training giant Global Knowledge last year, is one of the largest outfits in the MEA region, employing more than 120 instructors, the majority of them based in Egypt. Other training providers typically manage anything between 10 and 60 full-time staff.

Spectrum, for instance, has around 20 permanent trainers spread between its facilities in the UAE, Saudi Arabia and India. "In our industry, the biggest challenge will always remain the professionals - man-management is a huge task," confided Chauhan.

"You need a person who is passionate about training and loves to do it more than anything else. It is not a market that the big players want to enter because although the investment wouldn't be a problem for them, the reality is that you will never become a US$100m training company out of this region," he added.

Developing a training organisation does require significant funding in order to maintain an adequate set of resources though, especially when new versions of applications and hardware are being released at increasing intervals. Not only do instructors need regular training, but demo equipment must be refreshed to keep pace with the shorter shelf life of the technology.

Synergy's operation in Dubai contains around US$5m of lab equipment that can be accessed on a remote basis. That means a Cisco trainer in the UK, for instance, could sit with a class of students and access all the equipment housed in Dubai.

"Although they do not see it in front of them, they have full control of it," explained Melad Ghabrial, managing director at Synergy. "This is also helping our expansion because it means our [training] partners only need to invest in hiring skilled people and can just rent the equipment on a need-to-use basis."

Mohamad Rabbat, managing director at SitesPower, a company that provides Adobe and Microsoft courses, says the training business has become extremely competitive in recent years, forcing some established providers to scale down their operations and making it impossible for newcomers to prosper.

He says regional inflation, large enterprises incorporating their own training departments and clients scrutinising the return they get on training investments has influenced the market's development.

"The difficulty of winning business depends on a training provider's ability to ensure quality and meet their clients' needs," added Rabbat. "For training companies that struggled, it had more to do with their business model's inadequacy in satisfying the needs of their clients than any other factors."Training providers that are heavily focused on coaching students say the vertical experience of their instructors is largely irrelevant, but enterprise customers express a strong desire for trainers that understand their industry and have carried out implementations in the field.

However, this can create a dilemma for training firms because individuals with experience don't always wish to relinquish the fieldwork to spend their whole time training. Some providers have formed professional services units, allowing trainers to adopt a dual-role, while also bringing in extra revenue.

Typical trainers in this region are estimated to earn average monthly salaries of between US$3,500 and US$5,000, with the figure rising depending on experience and expertise.

Today we are trying to develop a person, not a certification. You have to look at all the aspects that the person needs to perform properly on the job from the first day they start.

Market watchers say wages in the Middle East have crept up 25% in the past three years. Naturally, bilingual trainers with computer science, engineering or vertical industry backgrounds remain in constant demand, and subsequently regular movement between organisations - and regions - is not unknown.

"The moment a person is certified, the value of them in western countries is higher than the Middle East or Asia," said Chauhan at Spectrum, who adds that security courses have been the most powerful driver of growth over recent months.

Visa regulations ultimately mean that freelancing and sub-contracting is not as widespread as the west - where trainers often take courses at several institutes - and so training providers in the Middle East generally maintain 90% of billable resources in-house.

The nature of IT training isn't particularly conducive to creating so-called ‘iconic trainers' either and so few coaches can command business on the strength of their name alone. "IT training is totally institutionalised, whereas in the soft skills arena you can have a trainer who is known by their name and customers request that trainer only," said Naresh Parmar, general manager at ExecuTrain, a Microsoft Learning Solutions Partner. "There is a set curriculum with IT training and organisations feel more comfortable buying from specialised IT training companies."

While that specialisation means providers can fetch a premium for their services, the challenges facing the industry are actually more indicative of the retail sector, especially in Dubai. Like retailers, training providers need a physical facility to host customers and are therefore seeing their bottom line buckle under the pressure of rising lease costs.

Traffic and parking constraints - issues that retailers say is harming footfall - are also felt by training providers. It seems customers will have to accept higher fees unless training providers absorb the extra expenses.

"If somebody was to say online training is the answer I would disagree because people here are not habituated with a non-trainer scenario," said Parmar at ExecuTrain. "The answer is that the cost of these training courses will need to increase and customers must accept they have to pay a higher price."

Although instructor-led training is more effective for hands-on technology schooling and creates an interactive environment, there can be no denying that online training has a role to play in the future of the market, especially in areas such as technical theory.

"Online training can still be extremely effective in certain cases, such as organisations that use a custom-developed software solution," said Rabbat at SitesPower. "In such cases, end-user training can be incorporated into an online training system and made available to employees to learn organisational policies and basic software use at an employee's own pace."

That said, not all providers are ready to embrace e-training. Knowledge Cube, an Oracle Approved Education Centre that also specialises in Sun and Novell courses, only uses instructor-led training because the highly technical content it delivers commands a forum where questions can be asked and answered immediately.

"Our sales model does not allow for e-learning," insisted training manager Jacques van der Merwe. "In our experience, nothing can replace the personal touch of an experienced instructor."

One model said to be growing in popularity is the adoption of on-site training, which allows the training provider to better manage capacity of their own facility and alleviates the need for customers to send staff out of the office.

This option, which tends to be more prevalent among enterprise corporations with in-house areas allocated for training purposes, is gathering pace and has expanded to areas growing in stature, such as Linux.

"We are offering scheduled courses on alternative months and in the interim months we have - particularly recently - started to do dedicated on-site training," revealed David Allinson, MEA general manager at Opennet, the regional master distributor and training centre for Red Hat.

"We had a guy in Saudi for a month training Jeraisy and last month we trained a corporate in Kuwait, Kharafi Construction. We have offered it all along, but it seems to have become more popular. As the commitment to the technology grows, so too do the economics of on-site training."

Given the investment required to maintain a reputable training business, Aslam at New Horizons says he welcomes moves from some vendors to generate sales for the training channel, such as Microsoft's policy of awarding customers training vouchers when they install its software. "It is not a big amount, but this initiative definitely helps the training centres and encourages the user to re-invest in training," said Aslam.

Training providers are clearly under as much pressure as anybody else to make money, and in some sectors where the market is crowded that can be a challenge. The secret lies in finding the right formula to cover costs and make a margin, but still appear affordable.

It is partly for this reason that many training providers can also be found offering courses in broader business skills. "Today we are trying to develop a person, not a certification," said Ghabrial at Synergy. "You have to look at all the aspects that the person needs to perform properly on the job from the first day they start, whether it is management, negotiation or presentation skills."

With the Middle East IT market apparently in the midst of a skills shortage that could lead to a deficit of 80,000 jobs by 2010, it is difficult to know whether training providers should be celebrating or mourning. Ghabrial views it as an opportunity that should be grasped.

"It is a positive thing because we believe that there is so much to do and the business has to grow," he said. "But it is also frustrating because we have been trying to bridge this gap for five years. The gap is widening for many reasons and maybe the market is growing much faster than we can find people to get into programmes and train."

One threat that is likely to loom larger in the wake of continued demand is the prevalence of grey market or unauthorised trainers that use copied material or unofficial courseware to deliver sub-standard training at a cheaper price than legitimate providers.

"The market has got two segments - one is the organised training market, which has only got five or six players, and the other is the unauthorised training market where there are hundreds," said Parmar at ExecuTrain, giving an indication of how widespread the problem is.Grey training tends to be more pervasive where low-end applications or technology are concerned, simply because they are easier to teach and entail limited investment in equipment. Unauthorised trainers are even visible in the Linux space although Allinson at Opennet insists it has not been detrimental to business.

"There are instances of it, but I would say it is more of a background thing than a real threat to what we do," he said. "We have been in business a number of years and we have established a reputation across the board and that reputation carries some value for customers and partners alike."

For many training providers in the Middle East, future expansion either means enhancing the breadth of courses they offer or opening up in new locations.

The market has got two segments — one is the organised training market, which has only got five or six players, and the other is the unauthorised training market where there are hundreds.

Knowledge Cube is looking to cap its third year in the market by adding a third training room to its Dubai centre and increasing the seating space of the two existing rooms.

"These changes will increase our total capacity by about 40% and should be completed before the end of September," explained van der Merwe. "We will also shortly be employing an African sales rep responsible for selling Dubai-based training to the African market," he added.

Synergy, meanwhile, is in the process of launching an office in Tunis to cover North Africa, as well as developing its range of ‘globalisation certifications', which draw upon its expertise in multiple technologies. With vendors expressing a desire to evolve from technology certifications to role-based certifications, this is likely to be a trend that gathers pace.

"Since we have so many vendors under one umbrella, we are coming up with, for example, a security officer curriculum, which would be a six-month programme covering all competencies from Microsoft to Blue Coat and some other business skills into one certificate," explained Ghabrial.

Whatever path they take, training suppliers in the Middle East can expect a busy time ahead and, almost certainly, a greater level of consolidation.

End-user desire to improve productivity and retain employees means that the perceived value of external training should remain considerably high, but that doesn't mean providers can take their eye off the ball.

"Local training sessions are mushrooming now," reflected Aslam at New Horizons. "Dubai, being a hub, is prompting people to set up initiatives. Whether they are successful or not is a different story."

Lynchpins of learning

Your A-Z guide to some of the leading IT training providers plying their trade in the Middle East.


Locations:Bahrain, Libya, Qatar, Saudi Arabia, Syria, UAE Tel:+971 4 337 4888 Web:www.executrain.ae Specialist area:Microsoft Profile:ExecuTrain boasts 20 years of corporate training expertise and an independent network of 280 branches throughout the world. The company's partnership with IT content and courseware provider Element K has seen it provide technical and end-user training to the top regional and global enterprises. ExecuTrain claims to offer more than 1,800 IT and soft skills, ranging from basic MS-Excel tuition to advanced training on .Net development tools. Fast Lane

Locations:Bahrain, Egypt, Jordan, Lebanon, Qatar, Oman, Saudi Arabia, UAE Tel:+971 4 343 5300 Web:www.flane.com Specialist area:Cisco, NetApp Profile:Founded in Dubai 12 years ago, Fast Lane has grown swiftly to establish offices and alliances throughout the Gulf, Jordan and Egypt. The company's training portfolio comprises the standard range of Cisco network support, design and services, as well as the latest qualified specialist courses in security, IP telephony, network management and wireless LAN. Fast Lane, which claims to be NetApp's only worldwide authorised learning partner, also offers vendor-independent consulting, advising companies on their selection of leading-edge internetworking solutions.

FMC Training-Applied Digital Media Services

Locations:Egypt, Saudi Arabia, UAE Tel:+971 4 360 4554 Web:www.fmctraining.com Specialist area:Adobe, Apple Profile:US-based digital media training specialist Future Media Concepts (FMC) expanded into the Gulf two years ago by partnering with Applied Digital Media Services, which boasts a custom-designed training facility hosting digital training programmes. Classes include a range of vendor-authorised courses in digital editing, web design, motion graphics, sound design and desktop publishing. The company offers on-site training to clients throughout the Middle East.

Knowledge Cube

Locations:Namibia, UAE, Zambia Tel:+971 4 362 5500 Web:www.knowledge-cube.com Specialist area:Oracle, Novell, Sun Profile:Headquartered in Dubai, and with regional offices in parts of Africa, Knowledge Cube remains one of the region's top Oracle experts. Last year it was appointed as the only Oracle Approved Education Centre for the UAE, underlining its ability to deliver high-calibre Oracle training.

Its training centre is standardised on the latest Sun hardware, and it also has vast experience in delivering open source training covering both SuSE Linux and Red Hat. Knowledge Cube employs two delivery methods - instructor-led training at its training centre in Dubai, where all students have access to a PC, and on-site education at the customer's venue.

New Horizons

Locations:Bahrain, Egypt, Jordan, Lebanon, Qatar, Oman, Saudi Arabia, Syria, UAE, Yemen Tel:+971 4 396 2222 Web:www.newhorizons.com Specialist area:Cisco, Citrix, Linux, Microsoft Profile:New Horizons boasts more than 300 branches throughout the world, including 40-plus in the Middle East alone. Its training encompasses everything from basic application and desktop productivity tools, such as Excel and PowerPoint, to complex and integrated business systems based on information security and ITIL. New Horizons claims to offer classroom, mentored and distance learning options for virtually every desktop application used in the world of business.


Locations:UAE Tel:+971 4 335 5549 Web:www.sitespower.com Specialist area:Adobe, Cisco, Microsoft Profile:SitesPower Training Institutes specialises in customer-driven corporate training solutions with a focus on Microsoft and several other leading vendors. The company, which has training centres in Dubai and Sharjah, tailors its certification courses to deliver the exact skills that its customers need and this model has seen it win business from prestigious clients throughout the Gulf. As well as IT training courses, SitesPower offers tuition in soft skills and computer graphics applications. Following client feedback, the company is currently expanding its marketing efforts to promote the fact that it rents its conference rooms and lab facilities.


Locations:India, Saudi Arabia, UAE Tel:+971 4 391 2464 Web:www.spectrumme.com Specialist area:Foundry, Juniper, Kaspersky Profile:Spectrum has cemented relationships with a number of leading networking and security vendors, such as ArcSight and Foundry. The company offers on-site training, but delivers the bulk of its tuition from a state-of-the-art technical lab facility in Dubai, which simulates complex network environments. Spectrum is a local authorised education partner of Juniper, offering regular routing and certification courses to customers from around the Middle East. The company intends to develop its presence by establishing additional lab facilities in Egypt, Pakistan and Lebanon.

Synergy Professional Services

Locations:Egypt, Saudi Arabia, UAE; Partnerships in Algeria, Bahrain, Jordan, Kuwait, Libya, Morocco, Oman, Qatar Tel:+971 4 366 4550 Web:www.globalknowledge.ae Specialist area:Blue Coat, Cisco, Microsoft, Oracle, Nortel Profile:Acquired by worldwide training giant Global Knowledge last year, Synergy remains one of the most experienced learning solutions providers in the Middle East. The networking and security training specialist, which has a large operation in Egypt among other markets, offers a broad array of hands-on IT, project management and professional skills training featuring proprietary and custom curriculum. It runs more than 700 courses spanning foundational and specialised training and certifications.

The Network Center

Locations:UAE Tel:+971 4 3378 781 Web:www.tncenter.com Specialist area:Nokia, Check Point, Extreme Networks Profile:Founded more than 12 years ago by a management team from leading internet and network management companies, TNC initially made its name as the first Microsoft Certified Technical Education Centre in the UAE. The company has since developed its business to incorporate other technology vendors, such as handset giant Nokia, and insists that its intimate lab sizes guarantee high retention and maximum output.

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