Our strategic progress

Westcon International

Westcon International has developed its strategy according to its core values, enabling its partners and improving their business potential and performance. Westcon International's strategic framework aims to create value for all stakeholders via five strategic foundations that define its priorities, namely: sales and growth driven; solutions portfolio; sustainable excellence; digital and data leadership; and responsible business.

Westcon International aims to bring to market industry-leading fixed or wireless-based networking solutions, security, virtualisation, remote access and cloud computing products.

Westcon International will continue the model of specialisation for vendor solutions and will enhance the customer and market segment orientation with appropriately tailored propositions. It will prioritise financial and operating performance while investing in advanced systems and business automation which are accelerating its transformation into the world's leading data driven technology provider and specialist distributor of cyber security and networking solutions.

Below are the FY23 strategic objectives as published in the previous year, as well as Westcon International's progress against these objectives:

	2023 strategic priority		2023 delivery
	Sales and growth driven
	Achieve strong profitable sales growth +10% and improved gross margin percentage		Revenue increased by 18.3% to US$3.42 billion (FY22: US$2.89 billion)
			Gross margin was negatively impacted by significant strengthening of the US Dollar
	Establish and formalise cloud collaboration business unit in Europe		This unit was successfully established during the financial year

Achieved

Ongoing

	2023 strategic priority		2023 delivery
	Solutions portfolio
	Recurring revenues to represent 55% of total revenues		Recurring revenues represented 55% of total gross sales
	Expand next-generation sequencing portfolio revenues		Revenues from vendors reported under the next-generation portfolio grew by over 135%
	Operational excellence
	Positively impact productivity through continued roll-out of process automation and capabilities utilising digital technologies – achieve improvement to productivity ratio in every sub-region		Productivity improved in all regions except for the Middle East where gross profit was negatively impacted by accruals for prior year uncertain tax positions
	Organisational operating improvement achieving a gross profit to EBITDA conversion ratio >27%		EBITDA was negatively impacted by IFRS 2 charge and net foreign exchange losses. Excluding the IFRS 2 charges, EBITDA reflected a 26% conversion ratio from gross profit
	Digital and data leadership
	Transition to a digitally-enabled sales company – pilot and launch phase one of global CRM roll-out		Project had been delayed due to confirming design requirements. Project design is complete and is on track to be launched in FY24
	Successfully launch refreshed business-to-business ("B2B") PartnerCentral platform/marketplace		PartnerCentral launch in pilot countries successfully completed during Q4 of FY23
	Responsible business
	Establish and formalise ESG policy and framework in line with globally recognised and adopted frameworks		Formalised team and tools to deliver against Westcon International's intent and desire to achieve net zero carbon emissions by 2050 Formally signed up to the SBTi initiative, signalling Westcon International's intent to measure and report on climate-related impacts
	Nurture internal talent while developing a positive external employer brand through advocacy of performance and values – show improved employee engagement metrics		Westcon International reported an improvement in overall engagement and advocacy (over 91% would recommend joining Westcon International)

Achieved

Ongoing

2022 strategic objectives still in progress at date of 2022 report

Below are the FY22 strategic objectives which were noted as still in progress in the previous year's Integrated Report, which were not identified as a FY23 strategic objective, and Westcon International's progress against these objectives:

	2022 strategic priority		2023 delivery
	Partner alignment
	Successful adoption of a sales commission system that enables the alignment of sales rewards and incentives directly with the achievement of specific vendor objectives		Successfully adopted in EMEA. Westcon International is still considering rolling this out to the Asia-Pacific region which is a significantly more diverse operating environment
	Segmenting customers so that the appropriate propositions and go-to-market models can be deployed in an effective manner		Significant progress has been made in this area to classify customers including embedding the data governance required across the organisation. This area continues to be developed to inform and enhance the go-to-market sales motions across Westcon International
	Execution excellence
	Positively impact productivity through continued roll-out of process automation and capabilities utilising digital technologies		Productivity improved in all regions except for the Middle East
	Digital enablement
	Continue to innovate in digital distribution platforms to enhance customer experience and vendor ecosystem		PartnerCentral launch in pilot countries successfully completed during Q4 of FY23
	Further targeted sales and marketing activity with named global and enterprise customers to drive further integration and adoption of the application programming interface ("API") toolset		Modest take-up by this customer segment
	People oriented
	Nurture internal talent while developing a positive external employer brand through advocacy of performance and values		Westcon International reported an improvement in overall engagement and advocacy (over 91% would recommend joining Westcon International)

Achieved

Ongoing

In executing its strategy, certain trade-offs are often required to be made, and decisions about trade-offs are made after careful consideration of the risks and rewards present in each case. During FY23, Westcon International experienced growth and expanded its market share organically. Gaining market share, territory expansion with existing vendors or bringing new vendors to existing markets requires investment and competitive pricing strategies which all come with a degree of risk.

Logicalis International

Logicalis International's growth in services is built on the excellence of its service delivery, delivered to clients with integrity and in partnership with them to help them achieve their goals. Additionally, with agile business practices, it is able to unlock further innovation and empowerment across Logicalis International to drive future growth and remain at the cutting edge.

Even though global trading uncertainties are expected to persist for the short to medium term, Logicalis International is confident in its ability to continue to respond to market needs. The technology segments that Logicalis International specialises in are key parts of cloud infrastructure and the remote access computing solutions necessary for enterprises to adapt.

Below are the FY23 strategic objectives as published in the previous year, as well as Logicalis International's progress against these objectives:

	2023 strategic priority		2023 delivery
	Continue to grow professional and managed services business		Logicalis International continues to grow its managed and professional services revenue in its core technology focus areas
	Continue to enhance new lifecycle solutions build around the hardware and software of Logicalis' most strategic vendors		Logicalis International has launched a number of additional global solutions including: Intelligent Connectivity, Logicalis Secure OnMesh, and Employee Collaboration To support these lifecycle solutions it has also developed its Managed Digital Fabric Platform and Managed Digital Fabric score, to provide customers with solid intelligence and actionable insights that will drive operational efficiencies and sustainable business outcomes
	Manage operating expenses to ensure they remain at an optimum level		Logicalis International management completed a number of initiatives during FY23 to manage its cost base so that the agile operating leverage model is maintained across its businesses
	Focus on operating cash conversion to ensure maximum positive cash flows		Logicalis International management's key focus has been to ensure that each individual deal sold is structured to generate positive cash flows for the business

Achieved

Ongoing

2022 strategic objectives still in progress at date of 2022 report

Below are the FY22 strategic objectives which were noted as still in progress in the previous year's Integrated Report which were not identified as a FY23 strategic objective, and our progress against these objectives:

	2022 strategic priority		2023 delivery
	Scale new lifecycle solutions globally to deliver the best outcomes to customers		All four of the Logicalis International global lifecycle solutions are now available in all of its markets, with employees trained to sell and deliver these services to its customers worldwide
	Continue to focus on growing annuity services revenue streams		Logicalis International has continued to focus its marketing and sales efforts on its annuity services, generating greater awareness of its capabilities and generating new business opportunities

Achieved

Ongoing

In executing its strategy, certain trade-offs are often required. During FY23, Logicalis expanded its market footprint through the acquisition of Q Associates, a specialist in IT consultancy and advisory services around data management, data protection, compliance and information security. Occasionally, Logicalis enters new territories or technologies without acquisition, which is often economical in start-up but can come at much higher risk based on execution.

Logicalis Latin America

Logicalis Latin America has a strong position in the region, being one of the largest ICT companies in the most relevant territories it operates in. Through a customer‑centric approach, the division has achieved a solid customer base comprised of blue-chip companies that drive innovation in their respective markets.

Despite a challenging environment in Latin America, it is expected that investments in IT, mainly the ones related to digital transformation initiatives, will continue to expand throughout the region.

Logicalis Latin America is confident in its ability to respond to its evolving customers' needs through a comprehensive and digital-ready portfolio leveraged by an ecosystem of leading partners.

While Logicalis is now presented as two segments, namely Logicalis International and Logicalis Latin America, in FY22 Logicalis Latin America's strategic objectives were included in the overall Logicalis strategic objectives included in the Logicalis International section above.