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Each month Branham Group interviews a leading executive of a Canadian or Multinational ICT company, industry association, or government agency. This month, Branham sat down with Harvey Dawson, Vice President of Client Services at QA Consultants, to talk about his experiences and lessons learned over the course of his 29 year career in the Canadian ICT industry. The following statements summarize some of the key points that Mr. Dawson would like to pass along to the Branham300 community.

On making the move from an Accountant to a Consultant and then into IT…

I actually started out planning to be a chartered accountant. One of the nice things that you get to do when articling at a public accounting firm is to fill in on the odd management consulting assignment when they come up. I really enjoyed this type of work, so I made what felt like a 180 degree turn and pursued my Certified Management Consultant (CMC) designation and jumped into the management consulting space.

I started working for a management consulting firm called Pannell Kerr Forster (PKF) and I was pulled pretty quickly into the IT consulting side of things because there was huge demand in that area and I really enjoyed the work. While working at PKF I was very fortunate in that the individual that was the practice leader at the time, was also my management mentor, and as a result I learned a lot about engagement management, IT Strategy and dozens of best practices that would have taken me years to learn. I guess you could say that I was very lucky to be at the right place at the right time in terms of accelerating my consulting career.

Both my experience as Auditor and Management Consultant gave me a very broad exposure to hundreds of businesses in different capacities. One week I would be working on a supply chain solution for a manufacturer, and the next week I was involved in an importing-exporting solution. As a result, I had a chance to meet hundreds of senior executives early on in my career. This kind of experience gave me an awful-lot more insight than a typical accountant or consultant normally sees.

After spending about nine years at PKF I was recruited into Touche Ross, and was a Senior Manager / Principal there for about ten years. Deloitte has a tremendous portfolio of clients in all vertical markets so I continued to get a lot of exposure in a vast array of areas. I liked this variety, but during the time I spent at Deloitte I was drawn to the software end of the IT industry. As a result, I ended up moving away from the public consulting field to the ISV/vendor side and spent over a decade specializing in the FSI space at a couple large firms, Atos Origin and Compuware, before eventually making my way back to consulting with QA Consultants a little over a year ago.

On Joining QA Consultants and its Latest Strategic Move…

Around the end of the last decade, I left Compuware after eight great years to join the QA Consultants team. At that point in time QA Consultants had been growing their on-demand and on-site staffing business but the management team began to notice that the company’s growth was flattening out a bit.

After looking at the ADM industry and speaking with our clients, the QA Consultants executive team collectively decided that the next opportunity for this company was to enter the managed services space.  This was my specialty.

My view was that I believed there is a glut in the application testing space.  An inefficiency, of sorts.  Software Development tools have improved drastically over the last ten years (code generators, RAD tools, Agile dev, modeling, etc.).   Testing tools however, are almost the exact same technology as they were 15 years ago.  It’s all about making software Faster.  This has resulted in an increase in defects found in production which is incredibly expensive.

The current paradigm is that most companies who develop or customize software, feel they can do a better job of testing than a dedicated testing firm.  I’ve been at the boardroom table where fellow executives would get together to talk about upgrading an ERP system (or some major initiative) and someone would say, ‘Let’s send that out to India, because that’s not our core competency’.

Our goal here at QA Consultants is to change the testing paradigm so that instead of looking at traditional outsourcing destinations, we want firms to see the value of outsourcing their work to a On-shore facility. Near-shore options may be slightly more expensive than firms in India or China, but the truth is we can deliver a higher value proposition in terms of quality and service while also reducing the risk of outsourcing work because they are partnering with a local near-shore organization. I have pitched this strategy to CIO’s at large organizations, and they always get it – they are willing to pay the slight increase (5-10%) in cost in exchange for reduced risk, quicker time to market/production, better control, better governance/SOX compliance, and higher quality applications.

With all of this in mind, QA Consultants made a very strategic move earlier this year when it opened up a 20,000+ square foot quality assurance test factory. We call it our OnShore Test Factory (www.testfactory.ca) in that it can scale to about 66,000+ square feet if need be. We believe that a managed service, where our customers come to us with a need (portfolio of applications), and we take care of everything at a more fixed cost, (far less than their current investment) is the key to the growth of our industry. With our new Test Factory we are confident that we can strengthen our value proposition to clients by accepting a lot of the responsibility that they usually take on, while also slashing local industry prices in half.   We leverage best practices from off-shore firms, innovate with automation and risk-based testing methods, and deliver western-style quality and service.

On what led to QA Consultants Growth through the Years…

There have really been three drivers of growth for QA Consulting since it was founded in 1994. The first spurt of growth was back in the late 1990’s when Alex Rodov joined the firm and the company made the switch from sub-consulting to direct-consulting. This is when the business began establishing direct relationships with clients as opposed to working indirectly with clients through one of the larger consulting firms. The second growth stint, when Harry France joined the firm, was a lot larger than the first. During this period of time QA Consultants began to co-position, co-present and compete alongside the big global consulting firms. The last growth spurt, which we are really still experiencing, has been driven by making smart management decisions, like investing in key personnel with the right background and really focusing on our value proposition and what kind of a strategy we are going to compete with when we go to market.

On the Company’s Next Major Milestone…

The next major milestone for QA Consultants is trying to get our Test Factory at least as big as our on-demand, on-site consulting business so that we can leverage the natural synergies between the two delivery models.  The demand for our Test Factory is growing very quickly but our traditional business is still growing at a fairly healthy rate, so it’s a bit of a moving target for us. In order to meet that milestone, more expansion is going to have to happen. We know that even if we filled the entire 66,000 square foot facility that we have now with testers that were all working on projects, we would still be short. From a revenue stand-point we will probably need another new facility to match the sales of the classic QA Consultants business. I believe this milestone is absolutely attainable and I am looking forward to the next year or two to achieve it.

On Entering Markets Outside of Canada…

Without a doubt, we’re going to get dragged into foreign markets. One of our new clients targeting the Test Factory is a large American bank. We are now working with them to test their Canadian and International based applications. That one client is going to start bringing us their American applications. I think this will become a trend, and lead us into the US, because a lot of our American and International clients see our service as a competitive lever, and understand the high value that we bring to the table.

Our only concern with this is that we want to make sure we are locally scalable first before we get dragged into very large International projects. Once we have mastered the local market, we feel as though it’s not a matter of if, it’s a matter of when we expand the business south of the border.

I hope that in a few years the paradigm will change to:  “We will need this application properly tested before launching our new program, better send it out for testing…to Canada”

Advice for Budding Entrepreneurs…

During the past winter months, we conducted an informal CIO Survey.  Every CIO that we met with over the past year really only wanted to hear our value proposition and the innovations that make it unique, that’s it. So my advice to any budding entrepreneur that is looking to get things going right now is that when they get the chance to meet with executives to pitch their service or product, they better be prepared to cut to the chase. Value propositions and the way you present them is more important now than ever before. So before you walk into any office or boardroom, make sure you have a rock solid value proposition that differentiates your firm from the competition and make sure you get right down to the point.

Parting Advice…

Two things:

• Stick to your speciality. -  Don’t just do it better than anyone else, stand the paradigm up on its head and do the common things in your business uncommonly well.
• Innovation is standard. - If it’s not broke, you probably have to break it. You have to innovate in order to stay on top and the instance you begin to stick with the status quo is the instance you begin to lose ground to your competition.