(Originally published in the April 2012 issue of the Nova Scotia Business Journal - "50 Best Managed Companies" special advertising feature)
The mark of excellence
Established in 1993, Canada’s 50 Best Managed Companies is one of the country’s leading business awards programs, recognizing excellence in Canadian-owned and managed companies with revenues over $10 million.
Sponsored by Deloitte, CIBC, National Post, and Queen’s School of Business, the program invites entrepreneurial companies from every region to compete for this designation in a rigorous and independent process that evaluates the calibre of their management abilities and practices.
The awards are granted on four levels:
1) Best Managed winner (one of the 50 new winners selected each year)
2) Requalified member (repeat winners retain the Best Managed designation for two additional years, subject to annual operational and financial review)
3) Gold Standard members (After three consecutive years of maintaining their Best Managed status, these winners have demonstrated their commitment to the program and successfully reapplied for the designation. Companies may requalify for two additional years, subject to annual operational and financial review)
4) Platinum Club member (winners that maintain Best Managed status for a minimum of six consecutive years)
Atlantic Region honourees include:
• Southwest Properties - 50 Best Managed Winner
• PollyCello - Gold Standard Member
• Charm Diamond Centres - Gold Standard Member and Requalified Member
• EastLink - Gold Standard Member and Requalified Member
• Acadian Seaplants Limited - Platinum Club Member
• I.M.P. Group International Inc. - Platinum Club Member
• Maritime Travel Inc. - Platinum Club Member
• O'Regan's - Platinum Club Member
• The Shaw Group Limited - Platinum Club Member
• Wilsons - Platinum Club Member
• Imperial Manufacturing Group Inc. - Requalified Member
• McCain Foods (Canada) - Gold Standard Member and Requalified Member
• ADI Group Inc. - Platinum Club Member
• Armour Transportation Systems - Platinum Club Member
• Cooke Aquaculture Inc. - Platinum Club Member
• Day & Ross Transportation Group - Platinum Club Member
• Oceanex Inc. - 50 Best Managed Winner
• Pennecon Limited - 50 Best Managed Winner
• Colemans Food Centres - Gold Standard Member and Requalified Member
• GJ Cahill & Company Ltd. - Gold Standard Member and Requalified Member
Companies grew amidst challenging times
The 2011 winners of Canada’s Best Managed Companies didn’t miss a beat. They stuck to what they do best — improving efficiencies, looking for new opportunities, innovating and growing.
“While Best Managed Companies recognize uncertainty on the economic horizon their focus has been squarely on growing their businesses and identifying new income streams,” said John Hughes, Deloitte partner, Private Company Services, and national leader of Canada’s 50 Best Managed Companies Program. “They grew through targeted spending in the form of acquisitions, enhancing their infrastructure and product and service innovation.”
These companies generated over $5 billion in combined revenue, growing by 12 per cent last year, and employed over 20,000 Canadians.
“These companies have proved that, even in an uncertain economy, if you are nimble enough, innovative enough and have a growth-oriented focus, there are opportunities to be found,” says Dino Medves, senior vice-president, CIBC Commercial Banking. “These companies, their executives and their employees serve as inspiring examples of what can be accomplished with a well thought out business plan, a strong team and a disciplined management approach.”
Here are their secrets to success…
Best Managed Companies search for good growth:
Growth remained at the top of the C-suite agenda. While mergers and acquisition activity softened over the last year given the uncertainty in Europe and the U.S., there are still significant cash reserves on the sidelines waiting to be put into the market and many market insiders expect M&A activity to increase over the next 12 to 36 months. Also, as many Canadian businesses see flat or negative growth, margin enhancement has been a significant strategy to maintaining income levels. An off-shoot of this, evidenced in this year’s Best Managed Companies, is increased instances of vertical integration as companies’ look, not only to increase margins, but to gain more control over their supply chain.
Best Managed Companies invest significantly in product and service innovation:
While this might seem like an obvious strategy, it is not. This year’s winners have invested significantly in product and service innovation to increase margins and to build attractive value propositions for their customers. This is another way Canada’s Best Managed Companies have been able to drive additional margins in excess of revenue growth, innovative and cost effective building materials to support infrastructure spending, particularly in the architecture, engineering and construction space. There were many examples of the implementation of technologies that lowered cost of products or services or increased the utilization or useful life of assets.
Best Managed Companies know that private equity has changed the game:
A significant number of Best Managed Companies have joined with a private equity partner in recent years. In many cases the private equity partner’s network, its management team, its insights on other business, whether it is pricing or cost reduction strategies, can ultimately help private companies become more successful. In addition, private equity brings a disciplined governance approach to entrepreneurial businesses and adds another management dimension that will support future growth.
Best Managed Companies understand that succession planning is an ongoing process:
A significant number of owners plan to exit their business in the next five years. Best Managed Companies addressing this challenge recognize that succession/transition planning is an ongoing process and requires a holistic view of the business and their owners, particularly where family enterprises are involved. Best Managed Companies view this business transition as an opportunity to build a foundation for a sustainable business by focusing on creating and protecting the value of their business.
Best Managed Companies continue to assess their exposure to the U.S.:
Many Canadian companies are seeking revenue streams globally and buying U.S. companies as the valuations are reasonable. More importantly, they provide additional growth opportunities in the U.S. and can become platforms to Mexico and South America.