It is time for Calian to re-think it’s brand, according to a senior executive.
The company struggles to be seen as more than a staffing company, said Kevin Ford, president of Calian’s business and technology services.
It is difficult to describe the company’s activities in one paragraph. The Ottawa-based company was founded by former mayor Larry O’Brien as a quality assurance firm in 1982. It now employs 2,200 people and provides the private and public sector with people, training exercises, medical services, aerospace technology and mechanical maintenance.
Ford plans to meet with Calian CEO Ray Basler to discuss its brand sometime next year.
“To me it’s all about moving from staffing and on to program delivery,” Ford said. “Programs are things that you continue to deliver, and have really no end, but they’re normally larger in scope.”
Calian is best known for finding IT professionals for the federal government and other private companies, but Ford says they have found footholds in other industries, like health care and defence.
A focus on health care
Calian operates 130 health clinics through a partnership with Loblaws. It also has two of its own clinics: one in Sackville, N.S., the other in Ottawa’s Westboro neighbourhood’s Real Canadian Superstore, and it is looking “to expand that program nationally,” Ford said.
Calian also runs 55 health programs for the military across Canada and recently won its first contract with an oil company, he said. Calian will supply nurses for Shell for remote oil and gas development regions in Western Canada, Ford said.
The company needs to show it is evolving, without “abandoning” the recruiting side of its business which is still a key part of Calian, said senior marketing manager Sharon Daly.
Staffing is one of the biggest issues facing the IT sector, said Cindy Baker, vice-president of policy at the Information Technology Association of Canada.
“One of the biggest issues facing the industry right now is a skills gap,” she said.
Calling IT professionals
There is a huge shortage of people to fill high-demand IT positions in Canada. This includes management, engineering and computer programming positions.
The sector contributes $67.2 billion to Canada’s GDP, accounts for 3 percent of total employment at approximately 600,000 jobs.
An IT company should look at Calian and think of its IT services division, while the Canadian Forces thinks of Calian as its healthcare provider, Daly said.
“It’s okay for a brand to mean different things to different people,” she said. Niche marketing can be a very important strategy for companies like Calian.
One of the reasons Calian is diversifying is to reduce its reliance on government contracts, such as National Defence.
“We’re looking to diversify in specific sectors like telecommunication and healthcare,” said Ford. “If you look at what government is going through right, with the cutbacks, and defence as well, if that was your only customer, it’s very tough to maintain and grow your business with one customer.”
The revenues of Calian’s staffing services division fell 5.5 per cent year-over-year to $38 million during its fourth quarter, which ended on Sept. 30.
Its health contracts were the only one not affected by government cutbacks, according to their quarterly results.
That being said, Calian’s engineering division, called SED Systems, reported an 8.3 percent jump in sales year-over-year to $19 million.
That division is based in Saskatoon and develops a range of products including technology for cable television, for satellite radio such as Sirius, communication satellites and deep space travel.
It also builds the test sets for Blackberrys to make sure they work properly before being sold, Ford said.
“We do manufacturing for the aerospace and defence industries. So we put antennas and radars on tanks,” he said.
Calian reported revenues of $232 million and net earnings of $13.1 million for the 2013 fiscal year. It reported revenues of $235.9 million and net earnings of $14.1 million last year.
Net profit was 41 cents per share, down from 44 cents per share from last year.
Expected revenues for the coming fiscal year are between $230 million and $250 million and a net profit of $1.65 to $1.85 per share, said CEO Ray Basler in Calian’s latest quarterly results. He says he remains guarded it in his expectations, “given the continued uncertainty associated with federal government spending.”
That is why Calian needs to show itself as a diverse company, Ford said.
“We don’t just do one thing,” he said. “Please don’t call us a staffing company.”