appex-case.pdf - APPEX CORPORATION Case 2 CIS 410 By Bradley Erickson Mission Statement To provide Management information systems and inter-carrier

appex-case.pdf - APPEX CORPORATION Case 2 CIS 410 By...

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APPEX CORPORATION Case 2 CIS 410 By: Bradley Erickson
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Mission Statement To provide Management information systems and inter-carrier network services to cellular telephone companies as well as credit scoring systems for financial service companies. Introduction Appex Corporation was founded in May 1986 from the merger of Appex Inc. and Lunayach Communications Consultants (LCC). LCC specialized in design and engineering of cellular radio networks for cellular companies. Appex Inc. was founded in 1984 by Brian E. Boyle and focused on management information systems for the cellular industry and credit scoring systems for financial service companies. The consolidated company, which was named Appex Lunayach Systems Corporation (ALS), integrated LCC’s engineering expertise and Appex Inc.’s business and systems expertise. ALS soon changed its name to Apex Corporation in May 1989. Appex was rated as the fastest growing high-technology company in the United States by Business Week in 1990. Revenues grew around 1,600 percent between FY1987 and FY1990 (Fiscal Year September 1-August 31). Total revenues grew from $1 million in 1987 to $16.6 million in 1990. As of April 30, 1990, Appex employed 172 people, of whom 153 were salaried and 19 were compensated on an hourly basis. With its rapid growth, Appex added about 10 people every month. In May 1988, Shikhar Ghosh decided to accept a position as chief operating officer (COO) of Appex Corporation, with the understanding that shortly thereafter he would be made Appex’s chief executive officer (CEO). Ghosh was a partner at the Boston Consu lting Group, where when he left he had many ideas on how to structure organizations. Appex at the time when Ghosh accepted the position was a relatively small company having only 25 employees and $2 million in revenues. Appex was entrepreneurial, technology-driven and loosely structured and they were losing money very rapidly. The venture capitalist who had invested in the firm was hoping that Ghosh would be able to turn it around. Summary Appex provided service to cellular carriers to allow them to manage their customers in their “home” and “roam” territories. Appex’s products could be divided into two different categories: inter-carrier services (ICS) and cellular management information systems (IS). The ICS business consisted of a set of on-line services that managed the information required for carriers to pr ovide service to cellular subscribers to and from other markets (“Roamers”). The primary services included an on-line national verification system that was used by carriers to authorize roamer calls (Positive Roamer Verification), a national financial clearinghouse for settlement of roamer charges between carriers (Inter-carrier Settlement Services) and a national location and call forwarding system for automatically locating roamers and forwarding their cellular calls to them (Roaming America). ICS was a high volume transaction processing service that contributed approximately 60 percent of total company revenues in 1990.
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