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|Articles - February 2014|
|Tuesday, January 21, 2014|
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Wilsonville-headquartered FLIR Systems, while also drawing the bulk of its sales from commercial markets, was not so lucky. The end of the federal fiscal year usually brings a “contract flush” as government agencies spend down their budgets. Not so in 2013. As a result, FLIR’s CEO told analysts, the third quarter was the worst he’d seen in his three decades with the company, which manufactures night vision equipment and other advanced sensors. As a result, FLIR revised its 2013 revenue expectations from between $1.5 billion and $1.6 billion to between $1.45 billion and $1.5 billion. It also announced plans to close six locations in the U.S. and Europe, although its Oregon headquarters still employs about 300.
Anticipating smaller defense budgets, the company gradually cut its share of government work from 57% in 2009 to about 40% today. Vice president of corporate development and investor relations Shane Harrison says the 2013 sequestration cuts and the government shutdown were not even the biggest factor in the recent performance of its military business. “The fact that there is no budget impacts us more than the fact that the budget’s going down. It’s the uncertainty that not having a budget creates in our customers that is what’s been slowing our business down over the last two years.”
Meanwhile, a handful of smaller companies have grown their government business in the face of flighty congressional funding by taking a more entrepreneurial approach to winning the military’s business. Hillsboro-based Eid Passport, for example, nearly tripled sales in just three years as a growing roster of military outposts adopted its commercially developed RAPIDGate personnel identification systems.
“One of the big jokes is that we are much better known in Washington, D.C., than we are in Portland,” says James Robell, Eid Passport’s president and COO. Discussing the company’s recent growth, he comes across as confident as he is affable, with a wiry white mustache and an open collar on his striped dress shirt.
Robell, a 19-year Intel veteran, explains how Unicru founder Steve Larson drew from his experience automating human resources tasks to establish Eid Passport in 2001. The company began working for retail clients – including a group of Kmart stores right as that company filed for bankruptcy – but its rapid growth began when the DOD began looking for a low-cost way to track vendors entering and leaving military bases. Most defense acquisitions begin with an exhaustive internal process to develop a detailed request for proposals. Eid Passport, by contrast, effectively cold-called Washington state’s Fort Lewis in 2004 to offer its kiosk system that confirms visitors’ IDs using biometric information like fingerprints. With fees charged to base vendors covering all the costs, acquisition officials were willing to work with the company to bring the technology up to military standards and install it on the base.
Within six months, Camp Pendleton in California also adopted the system, followed by other bases and government agency headquarters. The DOD now represents 80% of the 300-person company’s $40 million in sales.
“The most challenging part was to convince the people who are responsible for helping protect the forces that, ‘Hey, there’s a new way to do business, and it’s not the same way you’ve been doing it,’” says Robell. “It was unique, because they are used to pushing through, at that time, several layers of carbon copy for a visitor pass or a business pass. And we brought them a completely automated system that included biometrics.”
Sequestration, though, slowed the company down. Fewer off-site workers maintaining Navy ships, for example, means fewer people paying for their credentials to access the shipyard. As a consequence, Eid Passport’s revenues flattened last year, even though the company continued to add customers. To reverse that trend, Robell says he’s placed a greater emphasis on selling to industrial facilities and nonmilitary agencies, like the departments of Energy and Homeland Security.
Thursday, December 18, 2014
BY JASON NORRIS | OB CONTRIBUTOR
The implosion of the energy complex: The best thing for low oil prices is low oil prices.
Friday, December 12, 2014
BY LINDA BAKER
A conversation with Oregon state economist Josh Lehner.
Saturday, December 13, 2014
The president of LaPorte & Associates lets us in on his day-to-day life.
Thursday, December 11, 2014
By MEGHAN NOLT
VIDEO: Revamping a Classic — an iconic eatery stays relevant in a changing marketplace.
Monday, November 10, 2014
BY KIM MOORE | OB RESEARCH EDITOR
A market for low-carbon transportation fuels has a chance to flourish in Oregon if regulators adopt the second phase of the state’s Clean Fuels Program.
Thursday, December 11, 2014
There’s a fascinating article in the December issue of the Harvard Business Review about a profound power shift taking place in business and society. It’s a long read, but the gist revolves around the tension between “old power” and “new power” as a driver of transformation. Here’s an excerpt:
The authors, Henry Timms and Jeremy Heimans, don’t necessarily favor one form of power over another but merely outline how power is transitioning, and how companies can take advantage of these changes to strengthen their positions in the marketplace.
Our Powerbook issue might be viewed as a case study in the new-power transition. This annual book of lists provides information on leading businesses, nonprofits and universities in the state. Most of the featured companies are entrenched power players now pursuing more flexible and less hierarchical approaches to doing business. Law firms, for example, are adopting new technologies and fee structures to make legal services more accessible and affordable.
This month we also take a look at a controversial new U.S. Securities and Exchange Commission rule requiring public companies to disclose the median pay of workers, as well as the ratio between CEO and median-worker pay.
Part of the 2010 Dodd-Frank financial reform law, the rule will compel public companies to be more open about employee compensation, with the assumption that greater transparency will improve corporate performance and, perhaps, help address one of the major challenges of our time: income inequality.
New power is not only about strategy and tactics, the Harvard Business Review authors say. “The ultimate questions are ethical. The big question is whether new power can genuinely serve the common good and confront society’s most intractable problems.”
That sounds like a call to arms. Or a New Year’s resolution. Old power or new, the goals are the same: to be a force for positive change in the world. Happy 2015!
Thursday, December 18, 2014
BY MEGHAN NOLT
VIDEO: Under the radar — complete with a soda counter, the traditional Paulsen's Pharmacy looks to compete with big box retailers.
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While the Bend City Council ultimately upheld the approval which enables OSU-Cascades to move forward with the 10 acre site, it did also thoughtfully consider the nature of its code requirements, resident concerns and OSU-Cascade’s efforts and suggestions and crafted conditions of approval to address potential impacts of the site in the area.