enterprise risk management

School of Computer & Information Sciences

ITS 835

Chapter 27, “Nerds Galore”

This is a narrated presentation.

Overview

• Nerds Galore (NG) is Canadian service company with 1,000 employee, and provides

full-service information technology (IT) support to small and medium-sized Canadian

businesses.

• Formed in the garage of its founder, Jeeves Stobes, and has enjoyed growth in its

segment and has an excellent reputation with its customers.

• In the beginning focused on a particular customer subsegment, small start-up

business, especially on low-tech businesses such as boutique services.

• Strategy shifted more to midsized customers with more sophisticated technology

needs.

Overview

• Following a thorough investigation and follow-up with

many of NG’s key customers, the Executive Team has

concluded that the main cause had been high internal

staff turnover, leading to gaps in customer service and

service continuity.

• Continuing to provide strong customer service, it is

critical that team members are competent in the

latest technology, and yet turnover has approached

20 percent in three recent years.

• Was a problem for NG because of its high focus on

customer service and cross-selling approaches. Pay

packages were competitive but not at the very top;

instead NG uses its reputation for excellent customer

relationship and staff development to attract staff.

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10

15

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25

2008 2009 2010 2011 2012 2013

Overview

• Customer satisfaction has been

declining, Executive Team noted

that revenue numbers have not

suffered but has continued to

climb.

• Revenue drop was due to two

factors:

1. Many current customers have

multiyear contracts with Nerd

Galore.

2. Very small businesses that have

made up the bulk of NG’s customer

base are generally tolerant of

minor service hitches.

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20

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100

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Net Income

Revenue

Overview

• CEO Stobes set targets of 15 percent revenue growth year over year and a net income target of

15 percent of annual revenues, which will be a stretch.

• Gil Bates, NG’s vice president of human resources, who was recruited from Propell-O-Rama,

was concerned about not only the employee turnover rate but HR management.

• The strategy was:

1. Attract best talent

2. Retain good people

3. Manage talent

4. Optimize the use of people

5. Rely on outsourcers

Conclusion