Carrick steers toward $1B goal

If Eugene "Lee" Carrick's new career as presidentof Perot Systems Government Serviceswere a Broadway musical, it probably wouldbe "Most Happy Fella." After nearly six monthson the job, Carrick said he relishes the opportunityto steer the company's strategic course."I enjoy that role of being able to look furtherout," he said. "I like this strategy role."Carrick first gained the big-picture perspectiveas a space operations engineer withthe Air Force at Cape Canaveral, Fla., andVandenberg Air Force Base, Calif. He alsoworked on NASA's initialspace shuttle program where,he said, everyone was oriented toward oneimportant goal over long periods.After his retirement from the Air Force,Carrick joined a small information technologycompany and stayed on when it was purchasedby Northrop Grumman Corp. When heleft Northrop Grumman after a dozen years,he led the enterprise solutions group.Carrick joined Perot Systems GovernmentServices as executive vice president for nationalsecurity in November 2007. One monthlater, he was named to succeed departing presidentJim Ballard."We have very similar leadership styles," hesaid of the transition. "It was easy for me tocome in and fit into that leadership model.We're really headed in the same direction. Ourkey strategies, the markets we're chasing reallyremain unchanged."Carrick said the government unitwill bring in $650 million in federalcontracting revenue in 2008.It is ranked No. 41 on WashingtonTechnology's 2008 Top 100 list ofthe largest government contractors.The government revenue still trails thecompany's health care practice with its $1.2 billionin annual sales, the biggest division withinPerot Systems Corp.Carrick's goal is to reach the $1 billion mark infive years by taking advantage of the parentcompany's commercial services, such as businesspractices and healthcare.That implies about a 13percent compound annualgrowth rate for governmentservices, said George Price,principal at investmentbanking firm Stifel, Nicolausand Company Inc. "Could ithappen? Sure, it could happen.But I think it could bechallenging for them."Price said Carrick willhave to make some majoracquisitions to meet the goal.Once there, he added, "Idon't think the competitivelandscape for them changesdramatically." EDS Corp.,Computer Sciences Corp.and SRA InternationalInc. will remain PerotSystems' primary competitors,Price said."Acquisitions are alwaysan option," Carrick said."We're looking ahead. It'sdefinitely part of our fiveyearplan. No question."Carrick will also need totake advantage of PerotSystems' core competencies,especially its healthcare offerings. It's an areathat will see increased attention in government,especially if a Democratic administration takesoffice in 2009, Price said.Carrick called the government sector "a veryfertile market for us" no matter who wins theWhite House. There will always be uncertaintiesabout budgets, administrations and agency needs, he said, but the government must continueto function. And it will have to do so withfewer employees and a depleted cadre of seniorlevelexpertise."They have to cut costs," he said. "I believethere will be a continuing tightening of thebudgets [and a drive for] more efficiency. That,to me, leads to things like outsourcing, bringingcapabilities to them that can improve theirbusiness process, and that's what we do."As an example, he cited a $400 million contractwith the Education Department. PerotSystems won the Education Department Utilityfor Communications, Application andTechnology Environment contract, known asEducate, in October 2007. It was the fifthaward the government contractor has receivedfrom that department in less than three years.And Carrick wants to make sure it is not thelast.The expected wave of experienced governmentemployees retiring during the next fewyears is another reason why Carrick sees governmentas a fertile market. "We can help[with] the infrastructure, the business rules,the technology that will help them almost regrowsome of that workforce," he said.Under Ballard's leadership, Perot Systemsmade some critical acquisitions, including the$250 million purchase of QSS Group inJanuary 2007, nearly doubling the company'sgovernment business. QSS held spots on severallarge governmentwide acquisition contracts."I don't see any radical changes, so any acquisitionswe do would be in" our normal area,Carrick said. "We're not looking to go do somethingtotally different. We'll stay pretty pure."However, he declined to be more specific aboutwhat types of companies would be of interest.For the moment, Carrick is working to morefully integrate the expanded workforce anddevelop a management style that accommodatescurrent and expected growth. "There is a littlemore internal management that I am focusingon now that the company has grown," he said."We need to do that because I want to get to$1 billion soon. When you get to that level, youhave to have a different infrastructure, a differentstyle of operating, than when you're at $200million" in revenue.Carrick visits the corporate headquarters inPlano, Texas, at least once a month, sometimesevery other week. "I need to do that being new, tobuild those relationships and just learn the cultureand meet the people," he said. "And everytime I go down there, I learn something new,which is good."The headquarters in Plano provides humanresources, finance and sales support. "I get thebenefit of the process and the flow, the things Idon't have to worry about day-to-day," he said.That gives him more time to enjoy the responsibilitiesof formulating company strategy. To furtherthat end, Carrick fosters and encourages collaborationand the creative thinking of all 3,300employees at the company, based in Fairfax, Va."I'm very people-centric ? it's just the way I'vegrown up."Carrick said, "I keep telling my folks, 'I'm not thesmartest person in the room, let me assure you.But if we get six or 12 people in the room, we probablycan come up with a pretty decent answer towhatever problems we face as a company.'"