This is the first in a two-part feature on CEO of the Year John Sicard. Sicard will be honoured alongside other local business leaders during this year's virtual Best Ottawa Business Awards on Wednesday, Nov. 25 at 8 p.m. Viewers can watch the event here.
John Sicard’s ascent to the top of the Ottawa tech world almost stalled before it ever got off the ground.
Back in 1994, just months after relocating his family to the capital from Montreal to work at a small Kanata tech firm then known as Enterprise Planning Systems, Sicard suddenly found himself facing the unsettling prospect of looking for a new job.
Enterprise, it turned out, was on shaky financial ground. In an effort to stem the bleeding, the company slashed its workforce from about 80 employees down to 26 in one day.
“We just sat there around the room waiting for names to be called … and my name never got called,” Sicard says. “I was terrified, because I’d bought a house I couldn’t afford and moved my wife here. She had lived in Montreal all her life, so this was a very big deal.”
"We were asked to go and build the greatest supply-chain planning software that ever existed."
Having survived the drastic cuts, the young software developer and the rest of what remained of the company’s R&D team were handed a monumental assignment by then-CEO Michael Ker.
“We were asked to go and build the greatest supply-chain planning software that ever existed,” Sicard says with a smile.
“I remember clocking four to five hundred hours a month on just coding. We didn’t sleep. We were eating coffee beans for months on end building some of the technology that we still have today. We started from line one. It was such a privilege to watch and to be part of.”
The software that Sicard and his colleagues created, called RapidResponse, became the foundation of one of the most remarkable turnarounds in the history of Ottawa tech. The sophisticated business planning technology slowly but surely helped the company now known as Kinaxis regain its footing and embark on a path to profitability that’s made it a publicly traded powerhouse.
Much of the credit for that transformation must go to Sicard, who stuck with the company as it went through a series of name changes and restructurings in a struggle to gain altitude. Today, the firm founded 36 years ago by a trio of former Mitel employees is in full flight, and Sicard is in the pilot’s seat.
Ahead of its time
Earlier this year, Kinaxis was named one of the Toronto Stock Exchange’s top 30 performers of the past three years. The firm’s stock price has risen 140 per cent since 2017, and its value has roughly doubled since the start of the COVID-19 pandemic as customers scrambled to adjust to wildly fluctuating market forces that saw some products flying off store shelves while demand for other merchandise cratered.
“We’ve probably never been more relevant as a company than we are now,” Sicard says, repeating a line he’s recited often over the past eight months or so.
“It’s only recently we’ve sort of come out of the shadow of other giants, I will say, and people recognize what we’re truly doing. I would say we were ahead of our time.”
It’s safe to say that Kinaxis’s time has come.
The firm that couldn’t crack $10 million in annual sales when Sicard arrived is now projecting revenues of at least $220 million in the current fiscal year, with adjusted profits of between 20 and 23 per cent of revenues.
Now at nearly 1,000 employees in 21 countries, Kinaxis has been on a hiring spree during the pandemic. The firm is on pace to grow its headcount by 40 per cent in 2020 as more and more customers realize the value of its products in a global economy that’s been upended by the coronavirus.
The company’s cutting-edge software helps corporate heavyweights such as Ford, Procter & Gamble, Toyota and Unilever keep track of their inventory as well as decide what materials to order and when.
With consumer buying habits in constant flux during the COVID-19 crisis, the need for up-to-the-minute data on changes in price, supply and other variables is greater than ever, Sicard notes. As a result, the number of daily scenarios run by its customers has more than doubled during the pandemic and is now in the billions per month.
“The supply chain collectively makes the world go round,” says the 58-year-old native of Nova Scotia, who took over as CEO in January 2016.
With a chuckle, Sicard says even his teenaged nieces and nephews now grasp the significance of what he does after seeing supermarket shelves stripped bare of essentials such as toilet paper this spring.
“They didn’t really quite understand what I did for a living, but now they do,” he says with a grin.
While timing has undoubtedly played a part in Sicard’s success, his friends and colleagues credit his tenacity and insatiable curiosity for his rise to the top.
Former CEO Doug Colbeth says he realized right away that his future protégé had a mix of attributes you don’t often find in the corner office of the C-suite.
“He had this very rare combination of being extremely technical, but he was also extremely interested in all parts of the business,” says Colbeth, who took over the company, by then known as Webplan, in 2003.
“Even then, I could see that John had the potential someday to run the company.”
Groundbreaking business model
Over the next 15 years, Sicard became one of Colbeth’s most trusted lieutenants as the CEO worked to overhaul Kinaxis’s business model and instil a culture of success at a firm that had consistently failed to generate momentum.
Indeed, Kinaxis spent most of its first few decades in existence on the edge of a breakthrough that never quite came. As far back as 1992, the New York Times declared its customer reviews “almost too good to be true,” but the hype never translated into major market gains.
In 2005, the company changed its name to Kinaxis. That same year, it made a bold move that turned out to be a stroke of genius: instead of charging customers a one-time upfront fee, it switched to a subscription-based model, billing clients by the month for cloud-based software delivered online.
It was a groundbreaking concept at the time, and skeptics abounded.
“I remember (global research firm) Gartner thinking that we were going to fail,” says Sicard, who was responsible for overseeing the software’s creation as head of R&D.
“They said, ‘No one’s going to allow their bills and material out of their building and there’s way too much data to transfer across the internet.’ As a software engineer, when somebody would tell me, ‘That’s impossible,’ I’d usually say, ‘Pardon?’ I love problems like that.”
For a time, the firm’s financial picture remained muddied as upfront revenues fell while customers gradually shifted to monthly subscriptions. But just as Colbeth and Sicard hoped, the software-as-a-service model eventually gained traction and became the driving force behind the company’s growth.
Conceding there were some “scary moments” as Kinaxis navigated through the transition, Colbeth says Sicard never wavered in the face of criticism.
“I remember many evenings where late at night, John and I would say, ‘We’re going to figure this out – we just don’t have the answer right now. But we’re going to figure it out.’”
Part 2 of this story will appear next week.