Synergetics shakes it up with USGS quake data

A new contract to provide earthquake-monitoring software support to the U.S. Geological Survey has brightened prospects for a Fort Collins company that has quietly bloomed into one of the region’s largest locally based technology companies.

Synergetics Inc. will help the Advanced National Seismic System, which operates stations all over the U.S., develop the Prompt Assessment of Global Earthquakes for Response system, also known as PAGER.

The PAGER system will report on an earthquake’s location, magnitude, depth, and estimate of the number of people exposed to varying levels of shaking, a description of the area’s fragility and a measure of confidence in the information given. The information will be used to alert the appropriate agencies to the level of response that will be needed as quickly as possible.

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“We think it’s going to be a long-term, complex project,´ said Steven Smith, senior project manager for Synergetics. “Between the tsunami and Hurricane Katrina, there was a wake-up call to the world.”

The contract is for two years, with an option to extend for additional years. But value in this contract goes beyond the monetary.

First, this is the first project the company has done with the USGS.

“Past performance is everything in this industry,” Smith said. He explained that after working for an agency or company once, landing additional contracts becomes easier, at least for companies that perform well.

Federal market grows

Not only is the government market basically limited to U.S. companies, but the market is also growing. U.S. government agency spending on IT was $58.58 billion this year, and the approved budget for fiscal year 2007 for all government agencies is $64 billion.

Synergetics has expertise in some of the agencies where IT spending is the highest. The company has worked on projects with Warren Air Force Base in Cheyenne, Wyo. – the Department of Defense was budgeted to spend around $30 billion on IT in 2006. Another recent contract was with the Department of Agriculture’s Animal and Plant Health Inspection Services unit. The USDA spent around $1.9 billion this year.

Synergetics was founded in 1995 after growing out of a product-based company called Heterconn Inc. “By ’95, we decided we were more of a service-based company,´ said Synergetics President Rajiv Mehta.

Today, the company provides information technology service to enterprise and government clients, with expertise in complete lifecycle software, GIS applications and database development.

A look around the conference room at Synergetic’s office, across College Avenue from the Colorado State University campus, gives a good indication of the company’s reach. Hanging on the walls are certificates, plaques and pictures that paint the picture of a company making waves globally, but still connecting locally.

Certificates of membership for the National Federation of Independent Business, Rocky Mountain Minority Supplier and the Data Interchange Standards Association hang next to the company’s plaque proclaiming membership in the Fort Collins Area Chamber of Commerce, turn-of-the century photos of downtown Fort Collins and Metah’s “Mayor for a Day” certificate from March 31, 1983.

The company works with various government agencies as well as Fortune 100 companies – some have a presence in Fort Collins and some don’t. But all of Synergetics’ approximately 100 employees are located in Northern Colorado right now.

Rising employment required the company to expand into a second office just behind Tailgate Tommy’s restaurant on Drake Road in Fort Collins. Many Synergetics employees also work onsite with client agencies or companies.

Bucking a trend

Synergetics has been growing at a time when many IT service companies in the United States have been suffering.

“The service industry is catching up to the product industry,” Smith said. He added that issues are surfacing with off-sourcing – a term used to describe overseas outsourcing. Time-to-market, quality and communication barriers such as language and time zone differences are making outsourcing to foreign companies not as attractive an opportunity as it was once touted to be. However, companies are still sending work overseas.

“I don’t think it will go away,” he said.

Working in an industry where companies are looking to reduce margins from every angle can be a challenge, but Synergetics is filling a niche that promises to never get off-sourced.

About 85 percent of the company’s work is with U.S. government agencies, which are not only required to keep the work domestic, but also require that the contractors do not hire overseas companies.

Despite the stability of the government market, Mehta said it would be nice to see more of a balance between its contracts with the government and with private business. A mix of 40 percent private and 60 percent government would be ideal.

“I would like to get involved with private companies on a project level,” Metah said.

He explained that many private companies are often only looking for staff to augment their services. Such contracts are typically not awarded with an eye towards quality and expertise since the contracting company will still be handling the work. Instead, contracts of this type are awarded mainly on price – an area where Synergetics isn’t trying to compete.

Experienced engineers needed

The company offers advanced expertise in various areas of software and application development. It typically hires employees who are already skilled and experienced – a requisite that now has the company searching for help. It is currently ready to hire about 15 computer engineers and project managers.

“We’ve been advertising every week for the past few weeks,” Metah said, explaining that it is unusual for the company to advertise for employees.

Additionally, the USGS project will allow Synergetics to expand its portfolio of expertise, as well as expanding its potential client base. Because earthquakes and emergency response tactics vary across the nation and the world, Synergetics will put them in contact with a Spanish company that will share data for the project.

Because earthquakes are a worldwide issue, having expertise in the area will make the company more marketable globally. Especially, Mehta added, in Western Europe where performing on contract can be difficult because of labor law differences.

“To compete over there, you have to have some expertise or specialty,” Mehta said.

Synergetics is doing well competing on home soil – literally. The company was recently recognized for its work on a U.S. Department of Agriculture software package that is helping farmers and other agricultural professionals cut fuel costs, maintain production and protect soil and water resources.

The team that worked on the project – including representatives from the USDA and the National Resources Conservation Service Department of Agriculture – was recognized with the 2006 USDA Group Honor Award. The group’s Energy Consumption and Awareness Software Tools were designed to increase energy awareness while reducing costs.