Profile | Kam Ghaffarian, President and Chief Executive, Stinger Ghaffarian Technologies

It has been almost 20 years since Kam Ghaffarian and Harold Stinger stop their authorities contractor jobs to begin their very own enterprise in Ghaffarian’s basement.

Inside a month of touchdown a $21,000 subcontract to assist the now-defunct Mission Operations Knowledge Programs directorate at NASA’s Goddard House Flight Middle in Greenbelt, Md., Stinger and Ghaffarian employed their first worker. By 2002, Stinger Ghaffarian Applied sciences (SGT) Inc., whose providers embody engineering, science and knowledge expertise (IT) assist, had grown to 100 workers and $10 million in annual income.

At the moment, SGT has 1,700 workers, $400 million in income and a $3 billion backlog. It’s considered one of NASA’s greatest engineering providers contractors, second solely to Pasadena, Calif.-based Jacobs Know-how, to whom SGT simply misplaced a $1.9 billion contract to assist the Johnson House Middle in Houston for the following decade.

Ghaffarian, who purchased out Stinger’s share of the enterprise 5 years in the past, was nonetheless awaiting NASA’s Feb. 8 choice on that contract, dubbed Johnson Engineering and Technical Companies, or JETS, when he spoke with table4 Deputy Editor Brian Berger.

Why did you and Harold Stinger resolve to strike out by yourself?

Individuals who speak about our story, together with Sen. Barbara Mikulski (D-Md.) and others, speak about how an African-American pastor and an Iranian immigrant bought collectively to begin an organization.

Stinger mainly came to visit to my basement and we moved some bins round and that’s how SGT was born. We labored collectively at Lockheed and had supported Goddard House Flight Middle for a few years previous to SGT.

How lengthy earlier than you employed your first workers?

We began in December 1994 and employed our first worker in January 1995. From 1994 to 2002, we grew the corporate to about 100 folks, hiring one or two folks at a time. Our explosive progress began in 2002. We have now grown the enterprise about 40 occasions within the span of 10 years.

Has SGT ever gone by an unprofitable stretch?

Within the historical past of the corporate, from 12 months one to at present, there was just one 12 months the place we weren’t worthwhile. It was 2003 or 2004. And that 12 months was intentional. We needed to reinvest fairly a bit in our infrastructure to assist our progress. However each different 12 months we’ve been worthwhile.

What occurred in 2002 that led to your progress spurt?

Nothing that magical occurred. We rent a variety of actually good folks. One in every of my strengths is to acknowledge my very own deficiencies and rent lots of people a lot smarter than myself. They create success. That’s one of many key issues. The opposite is our values, that are encapsulated in three letters: ICE, for integrity, prospects, worker. Integrity in all the pieces you do; deal with your prospects; and deal with your workers. Since our inception now we have by no means misplaced a re-compete as a primary.

Did SGT profit from the spike in protection spending that started in 2002?

No. The explosion occurred by NASA. It’s solely been the final three or 4 years that we’ve been rising in different areas.

Similar to?

We’re one of many largest contractors on the U.S. Geological Survey. We run the Earth Assets Commentary and Science (EROS) Knowledge Middle in Sioux Falls, S.D., underneath a $300 million prime contract we received about 5 years in the past. We are also a primary contractor with U.S. Division of Transportation, particularly the Volpe Middle in Boston. The Nationwide Oceanic and Atmospheric Administration is one other shopper of ours. We presently usually are not a primary contractor there however we’re a subcontractor on a number of contracts.

Are all of SGT’s contracts with civilian businesses?

No. About 75 p.c of our income comes from NASA. Perhaps 15 p.c comes from different civilian organizations. And about 10 p.c at present comes from the Division of Protection (DoD) and different nationwide safety businesses.

What’s your evaluation of the place the market goes? Do you assume shrinking NASA budgets?

I assume a shrinking federal finances. To mitigate that, now we have to have much more baskets to place our eggs in, not solely inside NASA however exterior of NASA.

Can SGT proceed to develop within the present finances surroundings?

I actually imagine in purpose setting. After we began the corporate in 1994 our purpose was by the point we graduate from the 8A Small and Deprived Enterprise program, which was August 2005, to do $100 million a 12 months. We achieved that purpose. In actual fact we had been doing $102 million a 12 months. Our purpose at present is that by the tip of 2016 we’d love to do $1 billion a 12 months in income.

How do you count on to do that?

There are some new alternatives, however to a terrific extent it’s profitable work from others. Having delivered for our prospects over and over — previous efficiency — is extraordinarily necessary. We have now a stellar previous efficiency. Our common scores throughout all our contracts is over 95 p.c, which is type of exceptional. We even have a superb enterprise growth engine and we’re very value aggressive. Being privately held truly helps us. It’s a discriminator for us.

How does being privately held provide help to?

In case you are publicly held there are particular revenue margins it’s essential obtain. There are specific investments you won’t make. I’m the one hundred pc proprietor. If there’s a choice that must be made, folks come to me, I sit down, I consider it, I make the choice and I’m not apprehensive about what Wall Road goes to do to me or not do to me subsequent month.

What’s your common contract win ratio?

The business’s common win ratio is 20 to 25 p.c. Our ratio, because the inception of our firm, is 67 p.c. We have now an excellent win ratio. We win two out of three main bids that we go after. That’s our historical past. In consequence there are corporations that want to accomplice with us.

Who’re your primary opponents for DoD contracts?

There’s all kinds of corporations. If I gave you a listing, there’d in all probability be over 30. Throughout the NASA pond we’re an enormous fish. Inside different ponds we’re a small fish. After we go after different areas, our technique is to go after adjacenct market areas — locations the place we are able to leverage what now we have accomplished in NASA.

Are you able to give me an instance on the DoD aspect?

For instance, we work with U.S. Air Drive House Command. That work is adjoining to a variety of stuff we do for NASA. Identical factor with the Nationwide Oceanic and Atmospheric Administration. We’re additionally leveraging our engineering expertise working with NASA’s Ames and Langley analysis facilities to go after Federal Aviation Administration alternatives. The opposite one is IT. It’s totally different from engineering in that it’s moveable to a large number of businesses as a result of you aren’t coping with distinctive capabilities — IT is IT. So we’re in a position to leverage our IT capabilities throughout many businesses

Do you might have a subject workplace close to House Command in Colorado Springs, Colo.?

We do. We made an acquisition about 4 years in the past. We purchased an organization known as MSL, Grasp Options LLC, in Colorado Springs. That’s the place our places of work are. We’re leveraging that workplace to develop our DoD presence.

As new U.S. authorities program begins shrink in quantity, do you count on to see extra competitors for service contracts from the massive {hardware} producers?

Sure. We noticed that on JETS with Lockheed bidding. NASA obtained bids from Lockheed, Honeywell, SGT and the incumbent, Jacobs. They down-selected to SGT and Jacobs.

The place does at present’s technical experience reside: with contractors or civil servants?

There’s quite a lot of experience at NASA. And there are some areas the place the experience resides with the contractor. The important thing to success is just not a lot the place the experience resides however that we work collectively.

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