In late 2007, W3R Consulting, an IT and contingent-labor firm, was in the midst of breaking into the ripe new market of investment banks. CEO Eric Hardy was traveling from his company’s headquarters in Michigan to meetings in New York on a semi-monthly basis. He had just signed a contract with Lehman Brothers and was courting similar deals with other banks. It was a quite a development for this 14-year-old, out-of-region company to be seeing such traction in a market where relationships run notoriously deep.
Then Lehman Brothers started hitting turbulence, eventually declaring bankruptcy in 2008. Hardy hasn’t been to New York on business since. He says the banking community there “completely shut down” as a source of new clients. But as a company, W3R didn’t bat an eye. For an expanding IT firm, there’s always work.
“We have not necessarily been impacted the same way by the downturn of the economy,” says Hardy, who started W3R with a few friends in college. “IT professionals have seen a little bit of a cutback, but we’re talking about maybe a six- to eight-month period of time. Other than that we’ve only seen the market continue to grow.” Businesses today depend so heavily on technology that the people who supply, manage and use it effectively will have work despite the economic climate.
In fact, information technology is one of the fastest growing sectors of employment in the United States. The Bureau of Labor Statistics predicts that from 2008-2018, employment of computer and information systems managers is expected to increase by 17 percent, and employment of computer network, systems, and database administrators by 30 percent, giving these jobs growth rates much higher than average.
Still, employment recovery since 2007 and 2008, the industry’s worst years of layoffs, has been slow. But despite the industry-wide plateau, W3R looks to add at between 75 and 100 new employees to its staff of 250 in 2012. It seems they have fared better than many other IT businesses, even though the industry as a whole was somewhat isolated from economic turmoil.
Eric Hardy says he and his partners, Patrick Tomina and Keith Echols, are focused on three pillars of business: digital infrastructure, technology integration and application development. Their employees are contracted by companies to develop what he calls “high value solutions.” W3R consultants additionally provide project management, data warehousing and business intelligence services.
“We actually are the innovators and the integrators of technology that helps to make companies more efficient,” says Hardy.
He helped start W3R as an internet-based web integration and design company while training to become a software engineer in the mid ‘90s. As the company’s client base diversified in terms of industry, size and geography, W3R continued adding services. Hardy estimates that contingent staffing now drives 75 to 80 percent of his company’s $25-30 million in revenue.
“One of our advantages is the ability to have relationships at a high level,” said Hardy. “In addition to our relationships, it’s our ability to bring those very unique solutions to the table around data and modeling that help organizations really be better at what they do.”
W3R offers service at a level of completeness that competitors simply can’t match, and that’s allowed it to survive newsworthy market instabilities.
Take the trend in downsizing, for example. Just as some of W3R’s customers have cut and consolidated staff, so they have done for contractors. To that end, some customers opted for a bid process to help them choose one or two companies to contract the entirety of their IT to. After winning a few of those bids, W3R is now the sole provider of IT support and staffing for some clients. Large accounts became monolithic accounts.
It’s impossible to mention current economic uncertainties without considering W3R’s other major market: insurance companies.
Obamacare has been a boon. In order to meet new government mandates, “[insurance companies] have created a number of new products, and all of those products are driven by data and information as well as new technology components that they need to actually run that portion of their business,” says Hardy. “It’s created a lot of opportunity for IT companies.”
And if the Patient Protection and Affordable Care Act is repealed, a transition moving somewhat in the opposite direction may take place. “No matter what happens with how healthcare reform is implemented, I believe it is very positive for us,” says Hardy. “I think it’s the time to market by legislation.”
So if there’s any sort of boom, you can assume companies like W3R will be there to help scale. Alternatively, if there’s any sort of crash, you can assume that top players are considering contingent IT solutions to streamline their recovery. Everything in between also seems like fair game. The ubiquity of these firms is a symptom of their utility—a sign of technological competency’s growing importance as a requirement for profitability.
W3R is on track to outpace its 2012 goal of $35 million in revenue, and looks to add a fifth territory to its operation. But Eric Hardy measures success not only by growth, but by the technological competency of his clients and staff. “Our company motto is ‘Empowering Technology, Empowering People.’ We want to empower our people to really be the best they can be.”
For more information, please visit: www.w3r.com
