Dec 2019 Interview with Mr. George Troullinos, CEO, Intracom Defence
INTRACOM DEFENSE at a glance: general overview of the group and its success story, key fields of expertise, main achievements and recognition at global level. How does IDE contribute to Greece’s defense and security industry, and how does the company stand out? Key facts and figures to illustrate its importance and positioning at present.
INTRACOM DEFENSE (IDE) belongs to the Intracom Holdings group which is active in three key areas; Commercial Software Systems, Turn-Key construction business and Defense, with an annual turnover in the range of 0.5 billion Euro. The Intracom Holdings group employs more than 2,500 employees and its business activities concern mainly the international market.
Our activities in the Defense sector date back to the early 90’s. Over the years our exports increased gradually and today a significant portion of our revenue is associated with exports to the USA. According to the export statistics, over the past ten years IDE achieved approximately 5% of the country’s exports to the USA. This of course benefited not only IDE but also the Greek Defense Industry in general, since about 35% of IDE’s turnover has been subcontracted to other Greek industries.
Looking back to our almost 30 year history, I am convinced that what made the company to stand out on its own feet and also to survive one decade of the country’s harsh economic conditions, was our company culture. That is, our persistence in product quality, competitiveness and on-time delivery, in combination with addressing the international market and not focusing only on our internal market.
Close-up on IDE’s key products, solutions and concepts: uniqueness, applications and impact. How disruptive are your technologies, how do they contribute to industries globally, and how do they help tackle today’s mega trends and challenges? Examples of best technologies and outstanding solutions brought to market.
IDE’s business concept focuses in two main areas. First, to maintain a competitive industrial facility producing complex systems, such as PATRIOT Air Defense subsystems, F16 Radar and Electronic Counter Measure modules, Missile Guidance Data Links and Aircraft Electronic Assemblies. Our industrial capability is characterized by our customers as reliable and repeatable in terms of quality, and low risk in terms of delivery. This capability has enabled successful long term industrial cooperations with large scale system integrators, such as Raytheon, Boeing, Northrop Grumman and Diehl. Today, our products and support services are provided worldwide, either through such integrators, or through NSPA managed programs.
The second activity which is part of our business concept is that of investing in specific technologies and developing our own products in specialized areas. Our key product areas are Vehicular Communications and Information Systems, Hybrid Power Systems and Missile Electronic Systems. The strategy which can enable a medium sized company like ours to succeed in the global market is to develop niche technologies, leading to products that address military capability enhancements.
For example, in military vehicle communications, we focused on a weakness which is low intelligibility under noisy conditions in armored vehicles and we have developed WiSPR which provides effective communications and increases significantly situation awareness during operations.
Another example is our Hybrid Genaircon, a system that increases significantly the True Silent Watch capability of a vehicle and its power and fuel autonomy, contributing to the platforms survivability, especially under covert operations.
In the Missile electronics area, we invested intensively in developing high performance capabilities in missile guidance robustness and electronic warfare counter measures, which led to very successful products.
Insights into IDE’s latest financial performance and results; your outlook for 2020.
Thanks to the effective marketing strategy, IDE is profitable and generates between €50 and €70 million per annum (stable over the last years), with exports contributing the majority. The last ten years more than 95% of the company’s turnover stemmed from sales made outside its local market. Although spending cuts in Greece and the global financial crisis have both prompted challenges within the defense industry, including lack of financing and limited incentives to encourage productive growth, IDE’s turnover clearly indicates that it is continuing to draw success from international markets.
Quality and innovation at IDE: focus on the company’s R&D efforts, ability to innovate and priority research fields. How is the company working to pioneer new technology fields, and what can we expect from IDE going forward?
Regarding product development, IDE is continuously investing in maintaining engineering resources and laboratory infrastructure for advanced systems. This investment reaches 7% of our annual turnover, a figure well above the respective average of the EU. However, the most important company asset is its highly skilled engineers and scientists, which constitute the 60% of its overall personnel.
The prioritization of activity areas is closely linked to our company’s expertise and to the market needs, and it is based on careful analysis of the business potential, always taking into account the competition, and if you like, avoiding products that are likely to be part of roadmap of large international companies. In addition to that, IDE is carefully following the technology trends by participating with other industrial partners in European research and technology programs, which provide a valuable visibility into the future market needs. For example, according to current trends, it appears that notable interest is focusing on technology solutions concerning Unmanned Surface Vehicles, and we are investigating such solutions through collaborative technology research programs.
A look at IDE’s global business activities and expansion strategy: priority markets, strategic partnerships and collaborations in place with global defense and security manufacturers, acquisitions plans.
Our product business strategy and activities prioritize us to focus onto “quality-driven” users, such as the US, Germany, UK, Finland and others. In addition to this, and as part of our product market approach, we target to establish partnerships with companies whose technologies, industrial activities and market footprint are complementary to ours. Such partnerships often make good sense, because in this way, the partners obtain access to each other’s technological capability enhancing their product operational value, and also obtain a wider market access.
Focus on IDE’s marketing approach to grow the brand’s recognition and image globally.
In order to continue approaching and succeeding in the global market, it is important to continue and persist, as we did over the past years, to the association of our brand name with the concept of “quality” and “consistency”. It is the only way ahead for a company like IDE into a very competitive market.
Importance of the US market for IDE: key facts and figures to illustrate your growth, performance and development in the US. Your plans to enhance your presence and partnerships in the US market.
The US market is currently the most important market for IDE. Through our partnerships with US companies such as Raytheon and Boeing and our work on PATRIOT and AWACS, we keep our exports to the US at high levels. Currently IDE is working to introduce its Hybrid Power products to the USA and if successful, we will invest to produce our products in the US.
General reflection on Greece’s industrial dynamism: what do you view as the key elements to preserve Greece’s industrial strength and competitiveness, and reverse the brain drain? What are the key lessons learnt from the crisis?
There is no doubt that crisis has also been a lesson learning period. It is an unfortunate fact that brain-drain was probably the most important negative effect of the country’s economic crisis. An effect that will take time to be recovered. As a company, the most important thing to do in order to counter act this effect is to establish a climate of stability and potential for the future.
Furthermore, and in order for Greece’s industrial strength to be preserved, there are some important actions to be pursued with consistence; one would be to gradually lower the high levels of direct and indirect taxation. The current signs indicate that we are moving towards the right direction. Another action would be the country to exploit further, and in a more systematic way, the in-country use of the innovative technologies and products that its industry has to offer.
Looking towards the future: plans and priorities for the next 3-5 years in order to take the group to the next level; your vision and personal ambitions as CEO.
Sometimes one’s personal ambitions have to be left aside, especially considering that as a country we are going slowly through a transition, in terms of economy stability and potential. This does not mean that I am in favor of a dogmatic conservative approach. However, at this point and as a priority, one has to ensure that the fundamental strengths of the company which kept it going successfully so far are maintained. Our customers expect from us to continue as reliable company. To take advantage of this transition and make steps towards the future, our engineering product development capability is taking a priority in terms of investment, together with further industrial partnerships in targeted markets in order to enhance our international product sales. As we have been pursuing in the past, and as we monitor the development of the defense market trends, we target to facilitate co-production and support of our own designed products in other countries as well, by well established companies which are geographically closer to the end-users. All of the above cannot be realized without the continuous development of our exceptional personnel.
Concluding remarks and final message to the readers of Foreign Policy.
Considering that NATO and the EU are the two most important strategic memberships of our country, it is most beneficial for further advancing the industrial and technological capabilities of the member states, to participate in common NATO and EU (European Defense Agency – EDA) defense development and production programs. Such cooperative programs have a proven record of reduced cost of procurement of the end products for all participating nations, high return of investment ratio, and contribute significantly to industrial growth and stability. For this reason, we are looking forward and with high interest to more such cooperative programs and initiatives in the future.