SAINT JOHN – Twenty-five years ago, Phil Friedman, founder and CEO of Computer Generated Systems, Inc. (CGS), was on a cruise ship docked in Saint John. During a brief stopover, he paid a visit to a business in the city that partnered with CGS. This led to the beginning of the tech company’s Canadian subsidiary.
“At one point we did a lot of business with a partner in Saint John. It was suggested that I visit this partner – a small company run by Doug Stephen – to understand their capabilities and possibly establish a closer cooperation with them,” Friedman explained.
The business employed 11 to 12 people and was located on the second floor of the home of Doug Stephen’s mother. They provided learning and training services for corporations, in line with CGS’s offerings.
The intention was to build Stephen’s company so it could help CGS deliver learning and training services for clients in the U.S.
“That evening, I invited Doug Stephen to have dinner with me. The discussion progressed, and by the end of the evening I had offered to buy him out and bring him on board as a subsidiary of CGS,” Friedman said. “We negotiated a deal; I wrote it on a napkin. The next morning, I gave it to my in-house attorney, a contract was drawn up, and we bought the company.”
Friedman was most attracted by the quality of the people and their entrepreneurial drive. It was that quality of the talent in Saint John that led to CGS’ recent decision to hire up to 100 more people in New Brunswick over the next four years.
Positions will include project managers and coordinators, systems, quality assurance and business analysts, and instructional designers and solutions architects. CGS will also seek to fill positions for human resources, finance administration, account management and recruitment.
The new hires would boost CGS’s current Canadian headcount to nearly 300 employees, more than 90 per cent of which are in Saint John.
Friedman says this is because CGS Canada has been so successful in retaining the “very talented” group of people working for it in Saint John.
“To be frank, we looked at other opportunities. We could have expanded in India or Romania, which are probably lower-cost locations,” Friedman said. “But because of the stability of workforce in Canada and because we have good relationships with local colleges, and we’re able to hire young people, we decided to do it in New Brunswick. The fact that the provincial government was willing to partner with us and subsidize some of those hires obviously made a big difference.”
Opportunities NB (ONB) is investing up to $750,000 in the form of payroll rebates to back the job creation. The incentives are performance-based and only given to a company once it has met the criteria set out in its agreement with ONB. The rebates will be provided annually, based on the percentage of the salary of every job filled that meets the conditions in the deal.
The Crown corporation estimates that the jobs will contribute $15.2 million in GDP for New Brunswick and generate $869,000 in provincial income taxes over four years.
“New Brunswick’s multi-year economic growth plan focuses our efforts on creating job opportunities across the province in a variety of sectors, including the information technology sector,” said Premier Brian Gallant in a press release. “This economic opportunity is further evidence that our economic growth plan is working and that New Brunswickers offer a strong workforce which allows business to compete on an international scale.”
CGS, a 35-year-old privately held company founded in New York City, provides business applications, enterprise learning and outsourcing services. It has nearly 8,000 employees around the world, with offices in six countries and clients in 45 countries.
The Canadian arm focuses on providing learning programs, many of which are avatar-based and gaming-based, for multinationals like MasterCard, McDonald’s, Caterpillar and others.
Canada is also where CGS’s “channel enablement” line of business is based. CGS helps tech giants like IBM, Microsoft, Dell, and Kaspersky manage relationships with their smaller business partners.
Friedman says the new jobs in Saint John solidify the company’s commitment to New Brunswick.
“We will put New Brunswick on the map as the centre of excellence in learning and channel enablement in the world. Because from New Brunswick we provide support and work with companies globally,” he said. “CGS totally depends on the availability of quality and highly educated employees, and we’re very happy to say that we found it in New Brunswick.”
Banner image: Premier Brian Gallant and Phil Friedman, founder and CEO of Computer Generated Systems, Inc. (CGS). Image: submitted.
This story is sponsored by the Government of New Brunswick.