Ian Milligan is standing at the front door of his office as the taxi pulls up outside. He is in buoyant mood and proffers a friendly handshake. The previous day, his company, Nugensis, signed its first deal with a major North Sea oil company to sell its software after two years of wooing.
You might also expect him to be standing on his head; because this is exactly what his business has been doing so successfully. When the firm was set up in January 2011, it had no product and no idea what to sell. It simply asked its network of clients what problems and challenges they faced, then went out and found solutions.
Now Nugensis is one of Scotland’s fastest growing businesses, growing from its four founders to 39 staff. Last year turnover was £2.5m, with profits of £400,000, while this year turnover is expected to double to £5m, and to exceed £1m in profits. In March it secured a £2m contract with NHS Scotland for its award-winning software systems.
“The most important thing for us is that we will take £1 million of recurring revenue into next year. We are debt-free and will have the security of a year’s wages for everyone in
the bank,” says Ian Milligan. “Starting another company was always on my mind. It was simply a question of timing and the availability of talent. In 2011, the key people were all aligned and interested in starting this business with me.”
The trio joining Milligan were Stewart McQuillian, the operations director, Iain Edgar, the sales director, and the chairman Peter Quinn. “I worked with Iain and Stewart at Capito. I knew how good they were – and they are better at their jobs than I could be. Iain has forgotten more about sales than I will ever know. Stewart has a capacity like no other to deal with every detail. They are perfect for sales and operations.”
“The concept of Nugensis was built around these people. We were lucky we had clients who wanted to trade with us but we had no idea what to sell them. We spoke to our clients and asked them: what do you want us to do for you?” They all told Ian and other founders the same thing: don’t sell the same things that everybody else tries to sell us. This was a novel approach to starting a business. In many ways, it is counter-intuitive. But this was a clear message that the fledgling Nugensis team had to find products that were visionary, cutting edge and practical for customers.
“We thought long and hard and came up with a very simple strategy with some simple tactics to underpin it. We decided to drive towards sustainable profits by thinking differently from everybody else and by trying to exceed our customers’ expectations. That’s a big bold statement in terms of what we do.”
How could such lofty goals be achieved? This led to conversations with clients in two sectors, the National Health Service and UK oil and gas. The question being asked was: what problems do you have today that are not being solved?
This was a revelation. Once Ian and his colleagues learned more, they set off to find solutions for their clients’ pressing problems – bringing back a possible answer. So where and how were they able to find such solutions when others might have tried? “One of our longest-standing customers was at a computer show in London and he saw some new technology. He phoned us from the show and said: ‘This is amazing, you have to look at this stuff’ - and within four weeks we were selling it. This was Nutanix,” recounts Ian.
Nutanix delivers web-scale infrastructure which is scalable and simple in its interface with the users. Within two years, Nugenis were awarded by Nutanix the partner of the year for EMEA having sold £2m of product. The relationship with US-based Nutanix has flourished, but there was more. On the NHS front, another client alerted Ian and the team to a product that was being used in Trafford General Hospital in Manchester. “Again, we got a call from someone who said: ‘I think it’s very cool’. Four weeks later we bought the company. The product they were developing we now call WardView. We have integrated it into our business and the software is now in 38 hospitals, 87% of all the hospital in Scotland, in over 720 wards, covering 20,000 beds.”
Nugensis bought Deep Red, then owned by Stephen Waterson, [‘an absolute genius of
a guy’] who is head of applications and development and works in Nugensis’s office near Warrington. WardView replaces the whiteboard and felt-tip pen system in hospital wards which recorded each patient and what bed they occupied. The new system allows hospitals to monitor more effectively who is in each bed and how and when they are moved.
“It gives you a lot more information about the patient. It was a problem the NHS had that wasn’t being solved. Stephen had a brilliant piece of software but no ability to get it to the market. We had a market and the expertise to get it there. That was three years ago and today we have nine products, including PharmacyView and AdmissionView. We have just concluded our largest deal outside Scotland at NHS Doncaster and Bassetlaw who purchased our software for their three hospitals. We are beginning to gain traction in England and Wales.”
He says both these sets of products came purely by asking clients what they needed to solve problems. “Our success is through the way we engage with our clients. Never be afraid to ask them what they want; but don’t tell them what they need. We’ve stuck to this and it has served us pretty well.”
Scotland’s health minister Alex Neil heard about WardView’s effectiveness and made money available for the hospitals to implement the system. “It's easy to talk about ROI and efficiency gains when you design a system but we all too often forget the simple things, one of the best and most surpirising benefits of our system came in the form of feedback from the nurses – they now have time for a cup of tea in the morning. Before WardView the morning meeting took half an hour, now it takes 15 minutes. The nursing staff love the system.”
How does Nugensis select the appropriate technology to sell and then service? “We are interested in more niche products that solve specific problems. We are very good at that. We are good at building more into the product or solution than the customer expects – and we don’t charge more! It’s part of who we are and our culture, it's something we are very proud of.”
The third side of the business is ‘data visualisation’, where massive amounts of information can easily be assimilated and understood by under-pressure managers. “Yesterday we completed a deal and signed up our first oil and gas company on our latest product. It's a visualisation product that allows the management team to gain quicker and more insightful views on what is happening on their North Sea oil rigs,” he says.
Managers in most businesses are bombarded with daily reports that are often difficult to access and don’t clearly and simply show the key information. The Nugensis system takes all the key information from a myriad of sources and presents it in a simple view, in addition it allows management to trend the information. This builds a historic picture of what happened allowing managers to make more informed assessments of what the future could look like.
“Our data visualisation product took us two years to develop and get right. This gives us a chance to develop a software side to our business that will solely focus on the oil and gas sector. We are very selective about what we do. We have a robust process for introducing new technology into Nugensis . First and foremost, the technical team have to say they can deliver it, then the sales team have to believe they can sell it and a select number of our existing clients have to say they are interested in it. At that point, we adopt the product, all three parts have to be ticked.”
He says if you can’t deliver a product, there is no point in selling it, and if you can’t sell it, there is no point in being technically competent. If no-one will buy it, then the technology doesn’t matter a jot.
Another business trait that Nugensis takes pride in is its ability to deliver in shorter timescales. With public sector procurement often seen as a quagmire of delay and expense, Ian Milligan says Nugensis remains fleet of foot and delivers quickly on projects.
“For example, our software into major acute hospitals in Lanarkshire was implemented in three weeks. That’s unheard of. Once everyone connects, it’s quick,” he says.
Nugensis, headquartered in offices in Tannochside Business Park, in Uddingston, and in Warrington, and Aberdeen, is now working on exporting its products and looking for partners to help with its international expansion plans. It has been assisted by Scottish Development International, who have put Nugensis on an export programme, and the firm is currently assessing partners in India, Canada and Central Europe. [“It’s about picking the right partners, they need to have a similar philosophy to us.”]
Recently Jamie Rae, the entrepreneur and founder of Redeem, the Falkirk-based mobile phone recycling business, has joined as a non-executive director. He has also been using his networks to raise the Scottish firm’s profile.
“It is about getting our products to the market. We must sell professionally and quickly in a friendly manner. We need to keep developing our products at the pace we currently do. That’s the hardest part for our competition, it’s tough for them to compete with us on that. Our products will continue to look better, be more feature-rich and easier to use than anybody else's. That’s the best way for us to protect ourselves. Everyone in Nugensis is a sales person, perhaps not everyone recognises this though, but we depend on selling. Supporting sales has to be the number one priority for everyone.”
How did Ian Milligan reach this stage? Born in Kirkcudbright, he left the local high school at 18. “Rather than go to college or university, a job and money was much more attractive to me,” he recalls. He worked in weapons testing at the local MoD facility at Dundrennan for seven years. He admits it was a fascinating experience, but having signed the Official Secrets Act, he says he can’t say much about his work.
“That was my introduction to computing. There were few organisations in the world at the time that could afford large computing devices. During my time there, everything became computerised. It went from a computer the size of a large caravan to a single desktop.”
In his mid-20s, he left to join Gates Corporation, a global business that was at the time one of the largest privately owned companies in the world, making industrial and hydraulic parts such as belt drives for cars, escalators, and tractors, and also manufactured tyres, hoses and rubber belts. The Denver-based company, with its European headquarters in Erembodegem, in Belgium, was committed to network computing and Ian was put on courses to increase his skills.
“There was a facility in Dumfries where I worked. I got a wonderful introduction to computing at a global level. I was involved in global projects and I found that not only did
I enjoy it, but I was good at it too.” It was certainly a productive time for Ian, but he was told he might make more money as a consultant. At 27, he moved from the south-west of Scotland to Glasgow, joining Altor, an IT consultancy.
“I was always driven to stay in touch. I didn’t get stuck or stubborn in a sense of ‘this is what I do and I’m only going to do that’. When I moved to Altor I met sales people doing jobs I’d never seen before. I also started to get engaged with senior figures in the business. To see the importance and power of sales to an organisation was a huge learning curve. I quickly realised that if you wanted to grow and develop yourself, you had to be involved in and understand sales.”
He moved into pre-sales rather than technical consultancy. He then met Peter Quinn (Nugensis’ chairman) who owned a successful computing re-selling company called Capito. He joined Peter to help move the business from purely selling computer systems from IBM, Compaq and Dell, into a computing services operation.
“Peter recognised that his business had to change from mainly selling products to delivering service. He brought me on board and I became technical director. In three years we took the business from achieving 80% of its profits from products, to 80% coming from services.”
Capito was selling to public sector, including central and local government and health, and larger financial players and oil and gas. The yearly turnover was around £20m and the margin improved. “The role was simple: build a team of people capable of supporting a services business and find a way of integrating it into the sales process,” he says.
Peter Quinn remains an important sounding board for Ian. “He was the person who made me realise that sales and cash were the two most important things in your business. If you didn’t have one, you wouldn’t have the other. He’s a brilliant man to have as our chairman.“
Capito did well, Peter Quinn sold out and a new board took over.
Ian was uncomfortable with the direction. “I didn’t agree with the strategy and could not be a board member and part-owner of a business where I didn’t believe. I put my hand up and said, ‘I’m out and thanks very much’. I had no idea what I was going to do. No real inclination of what I wanted to do. I just wanted a break.” This was 2008 – in the teeth of the worst recession in post-war history. It was a scary thing to do. “Some people would say it was a bold move – others might say it was a stupid one, but I wasn’t happy. I wasn’t doing what I wanted to do. It was all amicable though.”
Five weeks later, he got a call from a friend who was nursing a failing £1bn project. Ian was asked to help Lend Lease, the construction company, who were working on the UK Government’s Building Schools for Futures. There was a bottleneck with the introduction of the ICT into the schools and it was a potential deal-breaker. Lend Lease was struggling with two contracts: one in Lancashire and the other in Birmingham. It was controversial in that the private sector was building schools through public-private finance partnerships and it was a political hot potato.
Ian Milligan was asked to run the overall ICT programmes. The deals involved ICT systems being linked to the construction and maintenance contracts for a 25-year period, yet this was not Lend Lease’s core competency. It was an arduous three years, but he left with the contracts successfully in place and the schools equipped with modern systems to help the next generation of young learners.
“It was project turnaround work and I absolutely loved it. It was one of the biggest challenges of my life, especially with Birmingham City Council, who were a very large organisation to deal with.” Why was it in such disarray? “It’s the same for every turnaround project, the client did not believe in what needed to be done. They didn’t like what was being put on the table and we couldn’t close the contracts because of protracted solution and legal wrangling. There were issues of emotion and politics too.” How did he resolve this?
“Step number one: meet the client and ask them what is wrong. It is amazing how many people don’t do that. Too many people assume they know why the client is annoyed. Or assume that they know why the client is wrong and they are right. Few people ask: ‘Tell me what’s wrong?’ It doesn’t happen in one meeting, but eventually if you listen enough you can boil it down to the main issues. Then you say: if we agree to fix these issues, can we close the contract. Step two is then implementing.”
With such large projects, he talks about the necessity for constantly ‘revising your specification’ to take into consideration the massive change in technology and computing.
While Ian had a large team within Lend Lease, he also brought in people such as former Capito colleague Martin Kerr, who taught IT law at Strathclyde University and played a critical role in working through the ICT contracts; Chris Dickinson, who Ian knew would ultimately take over from him, and Gian Fulgoni, a man with the passion, drive and determination to bring all of the pieces together.For Ian Milligan, it has come around full circle to sales.
“I’ve had the absolute privilege to work with some wonderful people who fundamentally changed the way I thought about working and selling. I’ve been inside businesses that have been heavily sales-focused and that has been a great grounding,” he says.
He also believes that companies spend too much time thinking about tomorrow. “Inside large organisations, they are all too keen to produce three-year business and financial plans, we have a three-month plan. We talk about and focus on staying in the moment – what will we do tomorrow not in one, two or three years' time. We have a strategy for Nugensis with hopes and aspirations, but we have three-month plans and objectives. If you can’t execute in the next three months, then you are not going to get to three years.”
After three months, the company’s goals are reset again, based on what has happened.
“This way we are constantly adapting and changing to what the customers are saying and the market is doing. If we keep on executing, if we keep on thinking differently, and we keep on exceeding our customer’s expectations, then we will grow as a business.”
This proof is in the contracts being secured by Nugensis – a Scottish firm with a strong future.