Arrowhead is on a growth track

Defense telecom firm's revenue expected to exceed $100 million next year

When Arrowhead Global Solutions Inc. — a company born in a home basement — moved into its current digs in McLean, Va., the building seemed exceedingly roomy. Now, just about a year later, space is tight and some employees have set up shop down the street.

For Arrowhead, it's a good problem — another sign that business at the American Indian-, woman-owned, small-business 8(a) firm is booming.

"We are bursting at the seams here," said Arrowhead spokesman David Sostman, one of the displaced employees. "There's a lot of energy. We're back and forth all the time."

The story of Arrowhead's success is easily told with numbers — its revenues have surged during the past four years and are expected to exceed $100 million in 2004. But, according to president and chief executive officer Mary Ann Elliott, the employees and the company's preparedness are crucial to understanding Arrowhead's continued growth.

Sixty-year-old Elliott founded the company in 1991. "Desert Storm had been fought and the term 'digital warfare' was coined," she said. "I saw that there was a market niche for my services."

Services aside, it isn't every day that a woman launches a defense firm. Elliott, however, has experience beating the odds.

Long before earning her reputation as a leading expert in commercial satellite communications, she dropped out of school in the eighth grade to get married. She had her first child at 14 — two more followed — and then she spent nearly 20 years as a homemaker.

When her husband died in a car crash in 1975, Elliott went to work at Motorola Inc. Two decades later, after stints at Navidyne Inc. and Talon Technology, she was managing her own operation.

Elliott began Arrowhead by undertaking small consulting projects. By the time the Small Business Administration certified the company under the 8(a) program in 1995, business was taking off, she said.

"It didn't just suddenly happen; it was all of these little steps," she said.

Those steps formed a solid foundation and a cornerstone of Arrowhead's strategy. To establish itself, the company developed an expertise and focused on a few customers. Arrowhead concentrated on knowing what their hot buttons and primary interests were, Elliott said. "The federal government is such a huge buyer that you get to pick which opportunities you get to pursue."

One of the company's major clients is the high-profile Defense Information Systems Agency.

"I think that Arrowhead has been very successful in defense telecommunications because of their very proactive form of marketing that has made the defense customers comfortable with their capacity as well as their ability to perform," said Ray Bjorklund, a vice president at Federal Sources Inc., a market research firm in McLean. They've put themselves "in a good position to be selected."

Arrowhead's wins and revenues suggest as much. It's one of three con-tractors for DISA's Defense Information Systems Network Satellite Transmission Services-Global program, the Defense Department's largest small-business deal. Other recent awards include designing and implementing the Defense Cyber-Warning Information Network and supplying mobile satellite services on air, sea and land under an Inmarset project.

"We have invested our profits into the infrastructure of the company and into business development and contract development," Elliott said. "That's money I could have put in my pocket, but then the company wouldn't have grown."

Arrowhead officials plan to expand their workforce to more than 250 employees this year, according to the company's Web site (www.arrowheadsat. com).

"As companies grow, you have to constantly reinvent yourself," Elliott said. So far, she said, the biggest change has been realizing "that I didn't do everything. You have to have a large staff to accomplish the company's mission."

She is dedicated to bringing in the "best and the brightest," Sostman said.

Employees credit Elliott's dynamic personality and use of cutting-edge technology for luring them to Arrowhead.

"I think the culture is unique because it's contagious," said Tom Reed, the company's senior vice president and chief financial officer. Reed came to the company in 2002 from Global Management Systems Inc., where he was president. "We're able to attract people attracted by a company growing like we are."

Although Arrowhead certainly has made a name for itself — the company is up for SBA's National Prime Contractor of the Year Award, to be announced this month — Elliot isn't sitting back.

"My biggest concern is maintaining our integrity, our quality [and the] capabilities of our staff at a profit," she said.

This will be particularly important after Arrowhead graduates from the 8(a) program next year, a move that will present new challenges, industry insiders say.

"Now you're out of the world where you're a big fish in a small pond and now you're a small fish in a big ocean," said Rodney Hunt, president and CEO of RS Information Systems Inc., which graduated from the program earlier this year. The biggest challenge, Hunt said, is whether you're prepared to "have controlled growth based on an unrestricted procurement environment."

Elliott isn't one to let obstacles stand in her way, and she is already looking ahead. "Defense homeland security is growing by leaps and bounds," she said. "Given today's climate, [Arrowhead] will either have to be sold or go public or go on a major acquisition trail ourselves. There's little room for midsize companies in the federal government."

Lisagor is a freelance writer based in Chicago.

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