Fitzgerald, Raja share traits in self-made companies
But both candidates question the other's business background
October 30, 2011 4:00 AM
Rich Fitzgerald (left) and D. Raja during a break in the Allegheny County executive debate Thursday at Robert Morris University.
By Bill Toland Pittsburgh Post-Gazette
D. Raja, founder of local software and IT company Computer Enterprises Inc., says he knows how to run a business, and that will help him run a county.
Rich Fitzgerald, sole proprietor of Aquanef, a water treatment consulting and sales company, says the same thing.
And each candidate for the job of Allegheny County chief executive says that his opponent's resume as a businessman has some troubling holes, diminishing their qualifications to assume the top elected post in the county next year.
"I think Mr. Raja's issues with employees speaks for itself -- 84 lawsuits," said Mr. Fitzgerald, the Democratic candidate and former president of county council. His most recent campaign ad attacks Mr. Raja for filing more than 80 lawsuits against former contractors and employees, mostly for breech of contract. The suits were first reported by the Pittsburgh City Paper.
Mr. Raja, meanwhile, says that Mr. Fitzgerald's company isn't much of a company at all, especially if it can count its full-time employees on one finger.
"He doesn't employ anyone. He's just himself," said Mr. Raja, the Republican and former Mt. Lebanon commissioner. "You learn by experience when there is scale," and as a sole proprietorship, Aquanef doesn't have enough scale to have imparted upon Mr. Fitzgerald many skills that would come in handy as the "CEO" of Allegheny County, with more than 5,000 employees and an operating budget of about $730 million.
Both men used their previous work experience in making the decision to work for themselves: Mr. Fitzgerald was an employee out of state, at Nalco Chemical Co., which supplies water treatment chemicals for boiler room use at mills, industrial plants and other industrial and large-scale consumers of water.
"While I was working for Nalco, I discovered that the water treatment equipment wasn't being provided" along with the necessary chemicals, Mr. Fitzgerald said.
"So that's what I do."
In the mid-1980s, he returned to Pittsburgh, to create the one-man consulting, engineering (he received his mechanical engineering degree from Carnegie Mellon University in 1981) and sales company he called Aquanef. Part of his job is selling and installing equipment from his roster of suppliers, such as Rohm and Haas, and GE's AquaMatic brand.
Last year, Aquanef did between $1 million and $2 million in sales, Mr. Fitzgerald said, and he has about 700 clients, from industrial clients to hotels to cafeteria vendors to Pittsburgh International Airport. Some of the maintenance work is outsourced to contractors, but some of it Mr. Fitzgerald handles himself.
A few weeks ago, said friend and business colleague Al Belejchak, president of Chemway Inc., Mr. Fitzgerald could be found standing on top of a newly installed charcoal filtration system at the airport, a system designed to provide potable water to the control tower.
"He's up there getting his hands dirty, [cutting] the bags and pouring the activated charcoal into the unit," Mr. Belejchak said. Chemway Inc., based in the South Hills, is a small water chemical supply and testing company.
Though Aquanef is small, Mr. Fitzgerald said the number of clients he keeps shows that he knows how to build and maintain relationships, much as you'd have to do in politics.
"I've gotta respond to my customer needs," he said. "And if my customers aren't satisfied, they'll go and buy from my competitors."
While Mr. Fitzgerald's company is very much rooted in the old Pittsburgh economy -- trafficking in boilers, steam and industrial equipment -- Mr. Raja's CEI is rooted in the new: Think software platforms, "technology solutions," Web portals and outsourcing services.
Mr. Raja's company is more well known, here and nationally. CEI, he is fond of saying, "started in the spare bedroom" and grew rapidly from there, now with nine U.S. locations and one center in India.
The headquarters remains in Scott. The company directly employs about 300, with about 100 of those in Pittsburgh, Mr. Raja said. About 75 are in Chennai, India.
As with Mr. Fitzgerald, Mr. Raja's company was partly born of the job that came before it, a six-year stint at Formtek, a Lockheed Martin company.
Born in Bangalore, India, Mr. Raja came to America in 1986, soon landing a scholarship at the University of Pittsburgh, where he earned a master's degree in computer science. After his time in California at Lockheed, he returned to Pittsburgh, pursued a master's in business administration from Carnegie Mellon and founded CEI in 1992.
His company, he says, specializes in adding functionality to software suites, writing business-to-business software and Web interface portals. CEI does that by using its in-house recruiters to farm out work to other IT workers or contractors, based on the client's specific technical requirements. CEI then manages the project with in-house support, accountants and finance team members.
For example, when pharmaceutical giant Mylan Inc. needed a variety of technicians for specific systems applications jobs -- such as a program that would route Mylan employees' 401(k) deductions from the paycheck to the investor -- it contacted CEI to provide employees with software-writing expertise. In this case, the expertise cost Mylan anywhere from $75 to $160 per hour, per consultant, of which CEI keeps a share.
CEI has an ongoing partnership with gas detection and hardware manufacturing company Industrial Scientific, based in Oakdale. Justin McElhattan, president of Industrial Scientific, said CEI-sourced software writers are now working on iPhone and Android apps that will allow for remote reporting of safety inspections.
That iPhone inspection data is then uploaded to a Web dashboard that can be viewed by a client's company management.
Mr. McElhattan said that Mr. Raja's most important skill as CEO -- and the one most readily transferable to the county executive seat -- is that of cheerleader in chief.
"The CEO is the best salesman in the company," Mr. McElhattan said. The CEO must sell the virtues of his own company "to develop talent, [to] earn customers' business and to evangelize. ... He can do that for the county, too."
CEI also offers outsourcing services, a service line that is accounting for a growing share of his annual revenue, something his Democratic opponent has seized upon as a political issue. Mr. Raja brushed off the criticism from Mr. Fitzgerald, who has served on county council since 1999.
"That's what career politicians do," Mr. Raja said.
The GOP candidate said that the experience of building, then running, his 19-year-old company is a good skill-set match for anyone who wants to be a county executive.
"This is really very similar to what a CEO does," he said. "How do you motivate people?"
Asked about the dozens of lawsuits against former contractors, Mr. Raja said that lawsuits are a part of doing business for big company with locations across the country and thousands of current and former clients and contractors.
"How many lawsuits does Allegheny County have? How many lawsuits does a Fortune 500 company have?" he asked.
CEI, which supplies workers and custom software to many of those Fortune 500 companies, reported $40 million in revenue in 2008.