CEO Interview: Sam Chebib, Nightingale Informatix Corp.

Guided by his combination of business, medical and engineering expertise, Sam Chebib has made a hobby out of acquiring software and services businesses (including VantageMed, HealtheNet and Scribes Inc.) in the healthcare industry. He's also guided the company he founded, Nightingale Informatix Corp. (TSX-V: NGH), onto the PROFIT 100 list for the second year in a row. The foundation of Nightingale’s business is Internet-based Electronic Medical Record (EMR) programs — systems that help physicians, clinics and hospitals manage their operations in paperless environments. Patient records, scheduling and billing are a few tasks made more efficient by EMR; Nightingale also provides a secure Internet connection that allows patients to schedule their own appointments online and download from the comfort of their own home everything from immunization records to lab results. It's not the only company providing such services, but it's easily among the most financially successful, which is why PROFIT talked to Chebib about his work and the future of his company.

What’s the greatest challenge currently facing your company and what are you doing about it?

The market for our services has been progressing quite well, but there’s still a behavioural change required by our clients to embrace technology. Physicians are used to processing medicine in a conventional, paper-based world and many don’t want to change. We’re releasing a digital pen later on this summer, and it will allow physicians to write notes and prescriptions on paper, while automatically storing them online. This is an innovative solution we’ve discovered that allows physicians to leverage technology without giving up their traditional ways.

How has the rising Canadian dollar impacted your company?

It’s impacted us quite a bit. Seventy percent of our revenue comes from the U.S. market. When the Canadian dollar was trading at the 75-cent mark, we had an inherent cost advantage. The rising dollar puts pressure on our top-line goals and has impacted our cost competitiveness. I much prefer the 75-cent dollar.

Some analysts are predicting a double-dip recession. How likely do you think this is, and is your company prepared to deal with it?

Well, I’m not an economist, but from where I’m sitting, I don’t think it’s likely. From my perspective, recessions aren’t bad. Recessions provide us with greater access to talent pools and make it easier for us to manage costs. The industry we operate in is somewhat isolated from movements of the economy. Having said that, we’d take another look at our costs, clean up the balance sheets and make sure we had enough cash revenue from our own product instead of relying on capital markets. You have to be proactive.

How would you describe your leadership approach or style?

It’s a simple approach. My job is to clearly communicate my strategy and vision.  That way, I can work collectively with my management team, and empower them. It’s a balance of giving my team the leeway to execute without me being in their hair. I manage by objectives rather than by test.

What’s a typical day like for you?

I keep an eye on the technology development, and I meet with my senior management team briefly. I make sure nobody’s stuck on execution. I squeeze in meetings with customers. I try to spend 50% of my time dealing with customers. The company has to live and breathe excellent customer support, and I need to communicate our philosophy and vision to new customers. In both Canada and the U.S., we’ve got about 2,000 customers that represent close to 8,000 physicians. I probably know 15%-20% of our customers on a first-name basis.

Your company’s home base is in Markham, Ontario. Where do you do most of your business?

We’re seeing a lot of growth coming from the U.S. and the Eastern Canadian market. In the U.S., our head office is in Sacramento. We’ve got people working out of Boston, Pittsburgh and Kansas City as well. We operate in all 50 states and in every province — except Quebec. Ontario and Nova Scotia are our strongest provinces. Physicians in Ontario can apply for up to $28,600 in funding [part of the e-Health initiative] from OntarioMD for assistance with implementation of EMR software. In 2007, Nightingale signed a 15-year contract with OntarioMD stating that Nightingale will be one of three preferred EMR-providers that physicians can choose from when seeking funding for implementation of EMR software. We have made similar agreements in other regions in both Canada and the U.S.