- The Washington Times - Monday, April 10, 2000

Digital Focus is teaching old-school Fortune 500 companies new technology tricks to help them compete in the information economy.

"Companies have a choice," said Steven Alexander, president and chief executive officer. "Don't compete, which is not a choice, or change how you do business."

As the Internet has evolved, so too has Digital Focus. What began five years ago as a technology tutoring company is now a multimillion-dollar systems integration company with operations across the country.

Mr. Alexander, who started Digital Focus in 1995, is surprised by how much his company has grown.

"Every entrepreneur wants to grow, but we didn't picture this," Mr. Alexander said.

Since opening its doors, Digital Focus has gone from just three employees with an initial investment of $1,500 to 65 employees with projected revenues of $20 million by the end of the year.

"We do a good job of balancing the quality of the growth and the rate of the growth," Mr. Alexander said.

One of its first clients, Daimler Benz Research and Technology in Palo Alto, Calif., hired Digital Focus to train its employees in Java computer code, which was relatively new in the mid-1990s.

For another early client, IBM Corp., Digital Focus provided on-site computer training and helped the Armonk, N.Y.-based company build its internal systems writing some of the Java code.

"They would hire us to come in and help them understand these new technologies," Mr. Alexander said. "We were very, very specialized."

Digital Focus also helped United Overseas Bank of Singapore create a loan origination system.

The demand for Digital's services industry-wide marketing, strategy, design, technical implementation and integration services now stands at about $19.6 billion, according to Christine Overby, associate analyst at Forrester Research.

By 2003, the market should climb to $64.8 billion.

"They are drinking from a fire hose of demand," said Ms. Overby, referring to Digital Focus and its competitors. "We are seeing this growth across a number of companies and there are going to be few losers in this market because of the sheer demand."

Digital Focus already has grown out of two small offices, and has recently opened new headquarters in Herndon. The company calls the new location the "iFactory," where everyone has a private office and individual annual expense budgets.

The office does in fact run like a little technology factory, with employees working in small groups brainstorming solutions for clients.

"It's a pretty friendly, tight-knit group," said Mr. Alexander, emphasizing that his company focuses less on micro management and more on team effort. That, he said, has pleased the staff and kept turnover low.

The average employee is about 30 years old, he added.

Mr. Alexander said he expects the company to continue growing. Among its other clients are: Federal Express Corp. in Memphis, Tenn., McKesson HBOC in San Francisco and Hertz Corp. in Park Ridge, N.J.

"The combination of strategy and technology is very powerful," he said. "If I have those two, I can get the marketing and the brand."

Aside from bringing Fortune 500 companies and some government agencies into the digital age, Mr. Alexander said Digital Focus also helps clients understand what their customers want.

"They (clients) think in terms of a product or a process," he said. "It's about shifting power to the customer, period."

For McKesson HBOC, Digital Focus developed a system that allows one of its subsidiaries, pharmacy company Value Right, to compete with on-line drug distributors.

"The vision we keep coming back to is value creation in the digital economy," Mr. Alexander said.

Digital Focus is steering itself toward new facilities in San Francisco and New York as well as another iFactory on the West Coast, he said.

While there are hundreds of systems integration and electronic commerce companies, Mr. Alexander said he does not foresee an imminent acquisition, though he would consider strategic partnerships to fulfill client requests.

"We can focus on our core strengths and partner with firms that complement our services," he said.

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