Reinventing Unisys

What a difference two years can make. Toward the end of 2000, Unisys Corp. officials contemplated selling the company's federal business. Sales were flat because Unisys, which traditionally focused on providing information technology services for back-office systems, was unprepared for the emerging emphasis on front-office and customer-focused applications. But weak market conditions and unattractive offers prompted the company to hang on to the federal division, aligning it more closely with the rest of the company.

The result could not have been more palpable. Unisys ranked 19th among the top 25 GSA Schedule 70 holders in fiscal 2001, with sales of $108.1 million, up 12.5 percent from the $96.1 million in fiscal 2000.

The surge can be attributed to the company moving "its business model from a technology focus to more of a service and consulting type of model," said Ira Kirsch, president of Unisys' federal government group.

Gone are the days when the company was ill-equipped to address the shift in the federal purchasing model from a focus on indefinite-delivery, indefinite-quantity contracts to large outsourcing deals.

"We have aggressively transformed how we address the federal marketplace. We view ourselves as a true solutions provider," said Kirsch, a 32-year Unisys veteran who took the helm of the company's U.S. government group a year and a half ago. This means offering a range of services, from high-level consultation and systems implementation to ongoing maintenance and support.

The company provides IT services in eight areas: customer relationship management, business intelligence and data warehousing, enterprise portal, enterprise resource planning, digital strategy and development, knowledge and content management, security and supply chain management. More than 75 percent of Unisys' revenue is generated by services.

To move to this service model, company officials realized Unisys needed to build a team with more skills and in-depth knowledge of the federal market. Unisys went on a hiring spree to boost its sales and business development ranks. The company hired consultants from the big five accounting firms, such as KPMG LLP, as well as federal systems integrators, such as CDW-G Inc. Recently, Unisys acquired about 150 consultants with federal experience from Arthur Andersen.

Now, Unisys has nearly 3,300 people managing more than 200 federal contracts, Kirsch said. "We have more feet on the street."

The company is now going after a different class of business. "In the past, we were going after lower volume contracts. Now we are going after higher volume, higher rates," Kirsch said.

For example, one of the company's biggest wins came last month, when it snared the high-profile $1 billion contract to supply the Transportation Security Administration with an IT infrastructure, including rolling it out at headquarters and airports, and installing a server and help desk. But that's just the most visible business for a company that has become ubiquitous in the federal market.

Unisys also recently won a contract worth $30 million from the General Services Administration in conjunction with PwC Consulting (recently acquired by IBM Corp.). The goal is to migrate mission-critical applications to an enterprise planning resource environment using software from SAP AG as the application foundation.

"There aren't too many [major] contracts that we're not on today," Kirsch said.