Emtec: Culture, Acquisitions, and Co-Innovation as the Upstream Future for Midmarket Firms

<p align="justify">In 2022, Emtec Inc., an information technology and digital services firm located in Florida, was at a critical juncture. The company had seen immense success as a hardware reseller and managed services provider to government agencies and midmarket companies in the US. But Dinesh Desai, the founder and former chief executive officer, was concerned about decreasing profit margins and intensifying competition in the current reseller and managed services business. Low barriers to entry were adding new entrants and competition on pricing as well as affecting the ability to acquire and keep talent. Furthermore, the pace of technological change influencing newer offerings such as cloud and custom development was creating significant uncertainty. For Desai, the question came down to the following: Stay the course and build upon established services or pivot to a different mix of offerings? The pressure to chart a new path was very important, given the uncertainty about the future and the cutthroat price-based competition in the market.

<p align="justify"><p>This case is suitable for use in graduate and undergraduate business courses, including but not limited to the following:</p><br><strong>Strategic Management or Entrepreneurship</strong><br><p><p align="justify">The topic should be of interest to students as Emtec is in a fast-paced evolving industry and provides digital transformation services, which are important to most firms today. These courses can (a) analyze how start-ups grow rapidly through acquisition, and the resources, strategy, and culture required for success; (b) discuss the role of acquisitions versus organic growth in mid-sized enterprises; (c) introduce the importance and role of culture in acquisitions; (d) explore the meaning and use of co-innovation as a strategy to change business models; and (e) review the IT/digital services market. The case provides context and content to cover all or a combination of these approaches.</p><br><strong>Information Systems</strong><br><p><p align="justify">The case should be of interest given that Emtec’s evolution mirrors the evolution of the technology (tech) industry, and the topic of digital transformation is usually a key topic in information systems courses. These courses can analyze (a) the IT/digital services market, (b) the meaning and instantiation of digital co-innovation in enabling digital transformation, (c) the role of culture in attracting and retaining talent, and (d) how cloud computing is changing conceptions of outsourcing, systems development, and external IT service providers. The case provides context and content to cover all or a combination of these approaches.</p><br><p align="justify">After working through the case and assignment questions, students will be able to do the following:<br><br><ul><li>Understand the unique aspects of midmarket firms.</li><li>Discover the importance of culture in enacting strategy and attracting talent.</li><li>Analyze the decision to acquire companies to enhance existing services.</li><li>Explore co-innovation between consulting and custom development of digital solutions.</li><li>Analyze and understand the large and growing digital services industry.</li></ul>

• Emtec Inc.
• information technology
• digital services
• managed services
• government agencies
• midmarket companies
• profit margins
• intensifying competition
• reseller business
• barriers to entry
• talent acquisition
• technological change
• cloud development
• strategic management
• entrepreneurship
• co-innovation
• digital solutions
• acquisitions
• culture
• it services
• digital services industry