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Scott MacDonald, president and CEO of Noise Solutions
Scott MacDonald, president and CEO of Noise Solutions

Case study

Noise control company bets on U.S. expansion, but will gamble pay off? Add to ...

THE CHALLENGE

In 1997, Noise Solutions Inc. was created to identify, address and relieve the pain points associated with the noise pollution facing many engineering, manufacturing, and oil and gas companies. The Calgary-based companies offers complete turnkey noise analysis and suppression solutions; something that very few organizations are able to do.

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Within a few years, Noise Solutions was a leader in its industry. However, after gaining momentum, the company was routinely shut out of larger opportunities because of its size and geographical location, significantly hampering the company’s opportunity to grow.

It was at this point that Scott MacDonald, president and CEO, and his management team, were faced with a critical question: to grow or not to grow?

THE BACKGROUND

Mr. MacDonald was born to be an entrepreneur, starting his first business in his teens and always meeting challenges head-on, with positivity. The mantra he lives by, and tries to instill in his employees, has always been “focus on where you want to be, not where you are today.”

Along with his father Rod, Mr. MacDonalad set out to silence industrial noise pollution by capitalizing on the resources available to revolutionize the budding industrial noise industry. Together they created and launched Noise Solutions Inc. in Calgary.

In its early days, Noise Solutions was forced to employ a partner model, bringing together all of the services required to meet their clients’ needs. But the company quickly outgrew this model and bloomed into a full-service noise management company with its own capabilities in analysis, manufacturing, design, engineering and installation.

With a customer-centric approach and focus on continuous innovation, Noise Solutions began to amass renowned clients. After only two years of operations, Noise Solutions was selected to work with the United Space Alliance to find a solution that would attenuate the loud noise of NASA’s Shuttle Crawler Transporters.

The company also received several awards and accolades for its innovation and ingenuity, being named a finalist for Canada’s 50 best managed companies and one of Canada’s Fastest Growing Companies by the Profit 500 in 2013.

Although successful, Mr. MacDonald was not interested in resting on his laurels. He wanted to learn from the company’s failures and continue to innovative to take the business to the next level.

One of Mr. MacDonald’s favourite quotes comes from Albert Einstein is, “A ship is always safe at the shore – but that is not what it is built for.” So, Mr. MacDonald cast aside his ‘anchor of past success’ and set out to evolve the business, have a positive impact on more lives and communities, and exemplify Noise’s core values of courage and continuous improvement.

He knew that if he wanted Noise Solutions to be a key player in the global environmental management industry, the company had to get out of its comfortable position as the ‘noise experts from north of the border.’ It was time to replicate what made the company successful and enter the U.S. market.

THE SOLUTION

After much research and diligence, Mr. MacDonald and his management team decided the best way to enter the south was through its sales and marketing office in Denver, Colorado. Noise Solutions (USA) Inc. began operating in 2009 under the leadership of Mr. MacDonald and Steve Morgan, executive vice-president of sales.

As the demand for Noise’s turnkey solutions grew, they knew they had to do more than just dip their toes in the water in the U.S. Noise Solutions would lose its competitive advantage if they contracted out services or continued to manufacture in Canada and ship products to the U.S. As a result, Noise Solutions evolved again.

In 2012, the sales side expanded into Pittsburgh, and in 2013, Mr. MacDonald further expanded the company’s presence in the U.S. by setting up a second full-service operation in Sharon, Pennsylvania.

For the company, this level of expansion to the U.S. meant learning new environmental standards and legal requirements, as well as the challenge of introducing a fairly new industry to the general public.

THE RESULT

Selective expansion into the U.S. has proven fruitful for Noise Solutions. The company has been exposed to new geographies, customers and opportunities. It has also developed a stronger brand in North America, solidifying Noise Solutions place as an industry leader.

In terms of quantifying the results, Mr. MacDonald says the company is now at the level where it can competitively bid on projects that a short while ago were the size of the entire company’s annual revenue.

As of early 2014, just five years after the entry into the states, Noise Solutions’ revenues have increased nearly 100 per cent. Mr. MacDonald’s realistic objectives for the future – what he calls 100-20-18 – is $100-million worth with an earnings before interest, taxes, depreciation and amortization (EBITDA), of 20 per cent by 2018.

Through mastering the science of silence, Noise Solutions’ mission to ensure harmony between industry and community has become a growing success.

For Noise Solution’s stakeholders, it’s a good thing Mr. MacDonald is on a ship and his anchor is nowhere to be found.

Arif Mulji is an instructor at the University of Calgary’s Haskayne School of Business (@haskayneschool).

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