The Sunday Times - UK (2022-06-05)

6 The Sunday Times June 5, 2022

BUSINESS

local telephone exchange. The pair of

them dusted down the gear and set about

installing it, connecting the receptionists

in the front office to the mechanics in the

workshops.

“The two of us wrote the software and

worked out how to program it,” Wadey

recalls. “Even before then,” he adds, “I

was always out with my dad helping him

on Sunday afternoon DIY jobs or working

on the car. I guess that’s where I got my

passion for engineering.”

After school at the local comprehen-

sive, he took a degree in electrical and

electronic engineering at Cardiff Univer-

sity; it included a sandwich year at British

Aerospace’s plant in nearby Filton,

where he went on to work after graduat-

ing. Wadey jokes that he always had to

live near decent surfing beaches, reeling

the local sites off like a pro — “Llantwit

Major, Porthcawl, Gower”. He and his

wife still live in the house in Bristol they

bought the month before their eldest

daughter, now 25, was born. His father, a

former teacher, and mother, a secretary,

still live in Bideford.

Not a man burdened by self-doubt,

Wadey volunteers the information that

he got a first at university, then became

UK managing director of the MBDA mis-

sile systems consortium at a mere 33

years old. “Yep,” he says with a nod as he

registers my impressed look.

MBDA was formed primarily through a

merger of the missile-making bits of Brit-

ish Aerospace and France’s Matra, later

going on to include their Italian and Ger-

man equivalents. It now has 13,000

employees and revenues of €4.2 billion

(£3.6 billion).

So Wadey’s move to run the smaller

QinetiQ — with more like 7,000 staff— sur-

prised some in the industry. But as a col-

league who worked with him at MBDA

recalls, the French were the dominant

partner there: “He knew they’d never

make a Brit chief executive.”

Wadey already knew QinetiQ well

because its technology was in the missile

systems he had been working on for

years, and he had also been a frequent

customer of its military testing sites.

At this point, he was also running a

body called the Defence Growth Partner-

ship, responsible for working between

Westminster and industry to examine

Britain’s role in the security world. “It

Stephen Wadey, boss of defence tech giant

QinetiQ, says he’s forged deeper ties — and

bigger sales — to Britain’s military allies

Ukraine

shows our

weapons

can do good

F

or lovers of James Bond’s Q —

that indomitable inventor of

super-spy gizmos — a visit to

QinetiQ is like a journey to Hog-

warts for Harry Potter fans.

Except, where Hogwarts is fic-

tional, the Ministry of

Defence’s prime research

establishment is very, very real.

At a recent presentation to

investors delivered in London’s Science

Museum, the company’s top brass were

displaying a range of robot soldiers capa-

ble of shooting people, a prototype laser

beam designed to shoot down enemy

missiles, and plans for something I never

thought I would see: an environmentally

friendly electric tank.

At the top of this high-tech organisa-

tion sits Stephen Wadey, a lean 52-year-

old with a Devon burr and that love of jar-

gon hard-wired into someone who has

worked in the defence industry since his

teens. “I’m an engineer — a practical guy,”

he declares proudly when we meet in a

back room at the museum.

QinetiQ was privatised by the Labour

government in 2001 with no shortage of

controversy. Private equity giant Carlyle

and the company’s former civil service

management team made huge money

when it later floated on the stock market;

chief executive Sir John Chisholm earned

a reputed £26 million paper gain.

It is widely seen as having expanded

with inadequate financial discipline at a

time of falling defence budgets; a sea-

soned cost-cutter, Leo Quinn, was heli-

coptered in to slash overheads.

He left in 2014 to do a similar job at

builder Balfour Beatty and QinetiQ

tapped up Wadey to fill his shoes. He

found a business that had restored its bal-

ance sheet but was still packed with sci-

entists working on pet projects that often

had little chance of finding buyers. As he

puts it, more delicately: “QinetiQ had a

great history of breakthrough technology

and innovation, but we needed a more

customer-centric view, rather than devel-

oping something because we could.”

W

hile Quinn was a generalist turn-

around guy — he had been troub-

leshooting at banknote printer

De La Rue before QinetiQ —

Wadey was a defence specialist.

This meant, say analysts, he had a better

handle on what clients, primarily the

Ministry of Defence, wanted, and he

instilled a far greater emphasis on collab-

orating with military buyers to develop

kit quickly to react to new battlefield con-

ditions.

In his first six years, QinetiQ revenues

grew more than 70 per cent, and last

month he set out targets to grow them by

another 75 per cent in the next five years,

from £1.3 billion to £2.3 billion. Wadey is

looking for acquisitions both in the US

and Australia to help get there.

It was always obvious to him that he

would become an engineer. When he was

13, in his first job working in a mechanic’s

garage near his home in Bideford, north

Devon, his boss came in with a van load of

old equipment that he had bought from a

INTERVIEW

JIM ARMITAGE

Top guns:

Stephen Wadey’s

defence

innovations at

QinetiQ echo

those of James

Bond’s Q, played

by Ben Whishaw

in the film Skyfall

We had a history

of breakthrough

technology, but we

needed to be more

customer-centric

TOM STOCKILL FOR THE SUNDAY TIMES

really caused me to stop and think about

where defence was going,” he says. “My

own conclusions were that we were going

to move to a type of defence far more

driven by information, knowledge and

technology.”

“I saw QinetiQ and thought, this has all

the right ingredients that you could really

do something with.”

His first five-year-plan led to QinetiQ’s

revenues growing rapidly as he focused

the business far more on working with

Britain’s closest military allies, the US

and Australia.

In targeting those countries as poten-

tial customers, Wadey presciently fore-

shadowed last September’s “Aukus”

security pact between Britain and the

two ally nations, which so put French

really good news is that project is now

closed and I’m really pleased that project

is closed.” On the tricky integration: “I

definitely learnt through that, but the

integration is now complete.”

Even on his own recent bout of Covid,

he says: “I had it three weeks ago. I’m

feeling perfect today.”

Given such relentless positivity, it is

surprising to find Wadey reluctant to talk

up the prospects for QinetiQ presented

by the Ukraine war — even though the

company’s shares are up nearly 40 per

cent since Russia invaded.

Western nations are beefing up their

budgets by billions of dollars and euros,

but Wadey remains cautious: “We have

not planned for significant top-line bud-

get growth. As of today, the US, UK and

Australia have made no fundamental

change to their macro budgets. They

have been reinforced, but not changed.”

What has changed, he concedes, is

that the war should reinforce those mili-

tary budgets as governments and their

electorates see Russia’s actions on the

battlefield on their television screens

every night. “Here’s an example,” Wadey

says. “Russia allegedly fired the first

hypersonic missile in theatre; one of the

huge areas of investment in the US is

around counter-hypersonics. Those

types of capability requirements will be

reinforced. And that’s going to require

companies that can genuinely innovate

and create disruptive solutions to do

that ... and fast.”

B

ut for all the talk of high-tech weap-

onry, surely the conflict in Ukraine

has shown that modern warfare is

not that dissimilar to the battles of

old: you roll out heavy guns and

flatten the enemy’s cities until they give

up... no? Wadey disagrees: “I think it’s

about both. It’s about those hard effects

but it’s also about how you use it, with

sensing and other tech to use those sys-

tems for maximum effect, and minimise

collateral damage.”

Asked if it bothers him that his prod-

ucts kill people, and he has a considered

response: “I think it’s about delivering

what our customers need. I believe in a

world where in democratic societies we

elect our governments and they look

after our security. If we can provide the

right technology — the right kit to allow

them to look after our citizens — then

we’ve been a force for good in the world.”

noses out of joint. Asked if he had been

tipped off about the creation of Aukus by

his high-level security contacts, he

demurs: “We weren’t aware [of it] in

advance, but it was great for us. It means

our focus on those three customers is a

good foundation for growth.”

N

ot every battle in Wadey’s QinetiQ

campaign has gone his way. The

sudden withdrawal of western for-

ces from Afghanistan last year hit

the company hard. It had been sell-

ing a lot of kit such as counter-IED (impro-

vised explosive device) equipment, par-

ticularly to the US. “We all knew there

was a withdrawal but the acceleration

was a shock,” he says. “A number of our

programmes were cancelled and we laid

off more than 100 staff in the US. It was a

significant impact.”

Wadey also had a secret contract go

wrong, costing the group more than

£14 million, and a troublesome integra-

tion of a US business that QinetiQ had

bought to improve its robotics arm.

He has a dogged, for which you might

read “grating”, determination to deflect

from bad news — a way of speaking that

one rarely hears outside politics. On

Afghanistan, he says: “There was an

immediate impact and challenge, but we

delivered a good year. We’re really

pleased with the update and guidance

for the year ahead.”

On the botched contract: “The

THE LIFE OF

STEPHEN

WADEY

VITAL STATISTICS

Born: June 16, 1969

Status: married with three

children, aged 19, 23 and 25

School: Bideford College,

north Devon

University: Cardiff — chosen

for its proximity to the beach

for surfing. He got a first-

class honours degree in

electrical and electronic

engineering

First job: British Aerospace

Pay: £646,800 (basic)

Home: Bristol

Car: Porsche Taycan

Favourite book: The Hobbit

by JRR Tolkien

Drink: Cobra beer

Film: the Bourne series

Music: Pink Floyd

and Coldplay

Gadget: my car!

Watch: IWC

Charity: Christian Aid

Last holiday: Spain

WORKING DAY

The QinetiQ chief stays

near the company’s

base in Farnborough

during the week,

waking up at about

6am on a normal day

and driving into the

office, via a Costa Coffee

drive thru to pick up drinks

for the team. He is at work by

7am to enjoy his latte with

Marmite on toast. He

normally finishes at about

7pm, followed by a business

dinner.

DOWNTIME

Stephen Wadey likes to

spend time with his family

and he loves holidays in the

sun or skiing. When not

doing that, he enjoys

mountain biking and running

— he is doing the Couch to

5K running programme after

an injury. When not enjoying

sports, he has a renovation

project in Spain.

Favourites include

Coldplay, The Hobbit

and the Bourne films.

He drives a Porsche

Taycan