Life lessons led to Octo Consulting's success

When Octo Consulting Group won a 2012 Greater Washington Government Contractor Award in November, the crowd erupted in cheers.

The company won in the under $25 million category, and when it did, the rise in volume evidenced the large number of Octo’s employees in attendance.

So what’s the story behind Octo, and what makes it something to cheer about?

Octo president and CEO Mehul Sanghani described three experiences that helped him shape both the company and his philosophy as an executive.

As a child, his parents borrowed money from family and friends and opened a motel in Blacksburg, Va.

“One of the things that shaped me as a leader is working in that motel with my parents,” Sanghani said. “We were the maids, the desk clerks, folded the laundry, did everything.”

As a 24-hour, seven-day a week operation, the motel helped Sanghani develop his entrepreneurial instincts. “It’s almost like an MBA crash course,” he said.

The second experience was just after college in 1998. Sanghani went to work in Silicon Valley as the dotcom era was booming, and there was no lack of entrepreneurial energy.

Sanghani worked for two different software companies over a three-year period. For a while, he worked with Dave Duffield and Peoplesoft, which at the time was a major software company before being acquired by Oracle in 2005.

He also had the chance to work at Commerce One, which was one of Mark Hoffman’s two successful business ventures. Sanghani was there during the company’s boom; joining the company as its 30th employee. “I had the chance to ride the wave of success,” he said. But he also had the chance to watch the company “flame out,” which turned out to be an important learning experience.

“But the biggest thing I learned was what really motivates people in a startup environment,” Sanghani said. “What really motivates people is not just the money, but they’re excited about the chance to make a meaningful impact.”

The third experience came when he moved to the Washington, D.C. area. He worked at Booz Allen Hamilton and Gartner, which equipped him with the skills necessary to begin a government contracting enterprise.

Sanghani recalled a project that he took on at Gartner. “I took an assignment there that really no one in the Gartner office wanted to take,” Sanghani said.

No one wanted to take the assignment because it was, in consulting-speak, “oversold,” which Sanghani said meant “sold for a little bit of money, but was a lot of work.”

In taking that project, Sanghani was allowed to shine. The project was with the Occupational Safety Health Administration. Seeing Sanghani in action, the administration was impressed.

“OSHA approached me,” Sanghani said, and asked him if he had ever considered starting a business. After getting permission from his company, he was able to work with OSHA.

Today, OSHA is still one of Octo’s clients, which is now busy “providing predictive analytics that allow OSHA predict where future fatalities might occur, and then in concert with that, where to target inspection before they occur,” Sanghani said.

Today the company counts Education, Commerce, Health and Human Services, Agriculture, Labor, Defense, Justice and Interior Departments, as well as Amtrak, and the Federal Communications Commission as customers.

Winning the GovCon award, which is given annually by the Fairfax County, Va., Chamber of Commerce, the Professional Services Council and Washington Technology, is recognition of what makes Octo unique, Sanghani said.

“First and foremost, it’s our culture,” he said. “In the beginning, I worked very, very, very hard to create something that would be unique, stimulating and fun.”

He is well aware of the challenges that companies face when differentiating themselves and how often there is “badge-switching,” which refers to how easy it is for people to change from employer to employer as contracts get switched out.

Not for Octo, though. One of the reasons the company is so attractive might be its benefits package. Employees get 100 percent coverage for health care. Employees also receive $5,000 a year for tuition reimbursement, and a $1,000 dollar bonus around the holidays, half of which goes to a charity of the employee’s choosing.

If not the employee benefits, though, maybe it’s the company’s strategic planning week, which Sanghani tries to have “in an exotic location” each year. The list of places where Octo has met for this week includes the Caribbean, San Diego and Miami.

“The last three years, we’ve done it in Las Vegas,” Sanghani said. It’s during this week that he and his executive management team make efforts to inform the company’s employees of the company’s plan, in order to keep everyone on the same page.

In a presentation that is called the State of Octo, Sanghani will lay out a “five-year strategic plan, and then a one-year strategic plan that gets more tactical on what we’re trying to achieve,” Sanghani said.

The company is six years old now, and has seen its results of its first ever five-year plan. “Remarkably, we met or exceeded in all the things we laid out when we first started the business,” Sanghani said.

As for the next five years, the company’s “objectives are to grow ourselves out of the small business realm,” Sanghani said. “We’re not just looking to get out of those set aside areas, we’re looking to be a business that’s around for the long haul,” Sanghani said.

Sanghani hopes to grow the company at a rate of 20 percent per year over the next five years.

“The market is littered with companies that haven’t been successful,” he said. “And we’ve spent a lot of time studying those businesses that haven’t been successful, and what went wrong, and looking at the businesses that have been successful, and what we need to do,” Sanghani said.

From what he’s seen, Sanghani and Octo have reorganized the company into two business units: “one that’s focused largely on management consulting, and one that’s focused on technology solutions,” Sanghani said.

Octo will shape its solutions to those markets going forward, he said.