Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Illustration of Daniel Friedmann, chief executive officer of MacDonald Dettwiler and Associates Ltd. (Anthony Jenkins/The Globe and Mail/Anthony Jenkins/The Globe and Mail)
Illustration of Daniel Friedmann, chief executive officer of MacDonald Dettwiler and Associates Ltd. (Anthony Jenkins/The Globe and Mail/Anthony Jenkins/The Globe and Mail)

THE LUNCH

MDA's Daniel Friedmann likes the Earth under his feet Add to ...

The head of Canada’s leading space company is decidedly earthbound.

Daniel Friedmann, long-time chief executive officer of MacDonald Dettwiler and Associates Ltd., cycles year-round to and from his home in Vancouver’s Kitsilano neighbourhood to the space-technology company’s Richmond headquarters. He pedals 45 minutes each way on a bike he bought at Costco, listening to podcast lectures on an iPod. In summer months, the spry 55-year-old sea kayaks, hikes and rock climbs. From October to June, he loves skiing, especially in the backcountry.

More from The Lunch archive

“I have no interest in going to space,” says Mr. Friedmann, who was schooled in engineering physics. “I’m self-powered. I’m not into engines.”

So it’s no surprise that Mr. Friedmann’s go-to business book is barely about business at all, steeped instead in the rigours and dangers of wild frontiers. Deep Survival: Who Lives, Who Dies, and Why investigates the DNA of disaster. The book’s broad conclusion is that people tend to battle distress by fixating on previously held plans, even as all evidence screams to the contrary.

Mr. Friedmann bought copies of Deep Survival for top executives at the firm. The stories in the book – about a hiker lost in the mountains, a boat wreck in the Atlantic, a pilot who crashed in the Second World War – resonated as cautionary and instructive business tales for Mr. Friedmann. The people in Deep Survival who die are the ones who fail to confront and adapt to traumatic circumstances.

“That’s exactly what goes on in business,” Mr. Friedmann says over lunch in a boardroom at the company’s unadorned headquarters. “Say things are going down, people aren’t spending money. A CEO says: ‘Well, it’s just temporary, it’s a blip, don’t worry about it.’ When people get lost, they do that.”

Mr. Friedmann has never been sentimental about business, even if MDA is the only company he has worked for since graduating from university in 1979.

The company had been founded a decade before Mr. Friedmann’s arrival, first specializing in electronics and software for satellite ground stations. It then became big in satellites – designing Canada’s Radarsat – and also got into real estate/property information. Total revenue peaked at $1.2-billion in 2007, up tenfold in Mr. Friedmann’s tenure as CEO.

In early 2008, with his property-information software arm growing rapidly, Mr. Friedmann tried to jettison the company’s foundation, the slow-growing space business, for $1.3-billion to Alliant Techsystems of Minnesota. Ottawa vetoed the sale on national-security grounds.

It was a lucky escape from a near disaster. The sale price was handsome but Mr. Friedmann would have been left with a company focused on real estate at exactly the wrong time, sales plummeting and profit evaporating. MDA would have suffered if Stephen Harper hadn’t intervened.

MDA hammered down costs at the property information unit just as real estate was sinking in the United States and the United Kingdom.

“You readjust,” Mr. Friedmann says. “Everyone else was saying, ‘A couple months, it’ll all be back like wildfire.’ Six months later, our competition was going under and we had already cut costs.”

Then, in late 2010, the company sold the property unit for $850-million to a Texas private equity firm, TPG Capital, a heavyweight with a $48-billion portfolio.

Mr. Friedmann’s hike-up-the-mountain personality is imbued in MDA. He has a cubbyhole office whose opaque glass fronts the small atrium of the company headquarters. On the Tuesday of our lunch, he has some yoga gear in his office, for an after-work class.

Lunch takes place in a cramped boardroom, labelled “Calgary.” Anne Beattie, Mr. Friedmann’s long-time assistant (“she knows everything”), declares the room a “mess” with its tangle of chairs, and straightens them. Mr. Friedmann arrives a minute later and declares there are too many chairs in the room. He wears a white dress shirt, open collared, and black pants. Lunch is veggies – carrots, green peppers, zucchini – with rice and grilled salmon (somewhat dry).

MDA tried to spend the money it got from TPG on a big-impact acquisition to give it much more heft in the space technology market in the United States, where it has struggled because it is foreign, a big reason Mr. Friedmann tried to sell the division in 2008.

But he couldn’t find a deal that worked, so the company deployed $500-million last summer in one of the bigger share buybacks in Canadian market history. Stock of the company – with a market value of about $2-billion – has been stuck in neutral in the past year but has more than doubled in the past three. On three-, five- and 10-year scales, MDA has outpaced the benchmark S&P/TSX index.

We are joined at lunch by Anil Wirasekara, the long-time chief financial officer who took his post in 1996, one year after Mr. Friedmann became CEO. Speaking more like a chief marketer than a bean counter, Mr. Wirasekara says, “What people don’t realize is that we have a brand” – he emphasizes brand – “that we have developed over 40 years. It’s world-renowned.”

The company remains on the hunt for a new business. Annual sales from continuing operations are roughly $750-million, up almost two-thirds from 2008. “We need to pick the right market, the right area, and then something to build on.”

A dozen years ago, MDA propelled its move into property information by buying BC OnLine from the provincial government after a couple of years of trying to start something similar itself with its software savvy. MDA wants to replicate the move, buying a company, taking on a smart management team and existing customers. A Canadian company focused only on space can’t succeed, Mr. Friedmann insists, citing other once-strong domestic firms such as Spar Aerospace that struggled.

MDA had just 100 employees when he started, so he quickly become involved in all facets of the operation. “It was six months and then I was at a customer lunch, trying to find a tie somewhere in my closet.” Along the way, he says he worked solo through the equivalent of an MBA, reading and studying everything he could about business during his off-hours.

One big project that is faltering is MDA’s ambitious quest to service satellites currently in orbit, starting with refuelling. Last March, it clinched a $280-million deal with Intelsat SA of Luxembourg, the world’s top operator of fixed commercial satellites – and the broader plan was to sign on the U.S. military and government to underpin the project. But the idea stalled, as the U.S. government, through NASA, is mulling plans to co-ordinate its own servicing project. MDA is watching the situation unfold, and applying to participate in the U.S. government process.

“We’re trying to do something that hasn’t been done before, in a country [Canada]that is not at the forefront of space exploration,” Mr. Friedmann says. “So it’s tough. And we’re not going to do it unless it makes sense for our shareholders. It’s not something we have to do.”

Mr. Friedmann has always been inventive. When he was in high school he and a friend designed a monoski system – a weird niche where the two skis are bound together as one. “It went bankrupt,” Mr. Friedmann says. “That business venture, I didn’t have Anil as my partner, that was my problem. We had technical problems, and marketing problems. Now I am perfectly safe.”

In space, the company’s biggest-ever deal is set to be sealed. MDA is the lead on Canada’s next-generation satellite system called Radarsat Constellation. The crucial Phase D, worth roughly $500-million to build the system, is expected to get Ottawa’s go-ahead by the end of March.

MDA technology isn’t widely recognized by most people because it generally operates unseen, in the background. When MDA’s Radarsat satellites monitor Canada – the surveillance can spotlight down to a single metre – there isn’t any obvious MDA or Made in Canada stamp that people can see or cheer.

MDA remains involved in a dazzling array of applications, from space exploration (prototype instruments to search for minerals on the moon and discern details on the surface of Mars), to women’s health (an image-guided surgical robot that performs breast biopsies), to monitoring the Earth (in one recent contract, MDA was commissioned to track “lightning on a global scale” for Lockheed Martin and the U.S. government).

The earthbound CEO of a space company keeps devising ways to bring technology from the sky to the ground. Using robotics in medicine is an enticing avenue, though sales have yet to take off.

On the company’s third-quarter conference call Oct. 28, Mr. Friedmann became enthusiastic about robotic surgery. While he envisages using precision robots to flawlessly close incisions on young patients, Mr. Friedmann’s colourful way with words meant he didn’t quite put it that way:

“We have another very good product that we’re putting together for stitching together small kids, but the thing stitches anybody together,” said Mr. Friedmann, who explained that much of the surgeon’s time is devoted to stitching people up at the end of an operation, a relatively straightforward procedure.

“I read a joke last night actually, the guy was reviewing his doctor’s bill and asked the doctor, ‘How come it’s so expensive?’ He said, ‘Well, you know, I hand-stitched you.’ So we’re trying to change that, make it by machine.”

CURRICULUM VITAE

Beginnings

Born Sept. 19, 1956, in Chile.

Moved to Vancouver with his family as a teenager.

Father was an engineer turned businessman, mother was a homemaker.

Masters in engineering physics, 1979, University of British Columbia.

Home life

Lives in Vancouver's Kitsilano neighbourhood.

Divorced and remarried.

One daughter, 26.

Career

Started at MDA in 1979 right out of university. After two failed interviews, pleaded by letter with founding CEO John MacDonald to give him a chance. Impressed with Mr. Friedmann's academic work, Mr. MacDonald told the head of engineering to hire the 22-year-old.

Became manager of systems marketing in 1985.

Promoted to executive vice-president/chief operating officer in 1990.

Appointed president in 1993.

Became CEO in 1995.

Passions

“Skiing, skiing and skiing, climbing, and kayaking, in that order.”

Rides 45 minutes each way to work. “I'm not a lover of bikes. I just bike so I can climb and ski. It's my training.”

Single page

Follow on Twitter: @davidebner

In the know

Most popular video »

Highlights

More from The Globe and Mail

Most Popular Stories