Top 100: Booz Allen sees contracts, acquisitions driving growth

Booz Allen Hamilton is a company with a vision – one that is bringing increased revenues, strategic acquisitions and sizable contract wins.

Based on the company’s Vision 2020, a growth strategy set in 2013, three pillars of success drove achievement in 2016, said Gary Labovich, executive vice president and leader of the firm’s Digital Solutions business. “One is knowledge of our clients, so we’re really focused on programs so that we really understand how they run,” Labovich said. Second is building and investing in DevOps and Agile development capabilities, while the third element is pushing innovation by investing in people.

“Booz Allen is a place where innovation is cultivated, continuous learning and development is expected and services are delivered to benefit the greater good,” Labovich said.

Last year, those pillars supported overall revenue of $5.8 billion, up 7.4 percent from fiscal 2016, and led to a backlog increase of 15 percent over the previous year. The McLean, Va.-based company, which was founded in 1914, holds the No. 8 spot on this year’s Top 100 list with $3.7 billion in prime contracts.

Booz Allen’s Vision 2020 strategy also put the wheels in motion for the company’s $250 million acquisition of Aquilent on Jan. 24, which added about 300 workers to Booz Allen’s headcount of more than 22,000. Those employees bring with them expertise in some of the company’s key interest areas, including Agile, DevOps and cloud, supporting Booz Allen’s talent shift toward workers who are proficient in systems development, cyber and analytics.

“They are a great fit for Booz Allen. They match exactly with our strategy,” Labovich said of Aquilent. It’s a “great cultural fit, great technology fit.”

Another acquisition also bolstered the company’s commitment to the Agile and DevOps approaches. At the end of 2015, Booz Allen acquired Charleston, S.C.-based SPARC, known for its expertise in those methodologies and bringing its relationships with the Defense Department, U.S. Marine Corps, U.S. Postal Service and Veterans Affairs Department.

Labovich sees no slowdown in the growth of these areas of accelerated development, and expects to see demand for them increase.

“I think the trends are continuing with what we saw last year,” he said. “We’re seeing a lot more of requests for cloud application development, cloud migration, cloud development…and, again, large-scale Agile development.”

Acquisitions weren’t the only contributing factor to Booz Allen’s success last year, however. Last March, the Defense Department’s Information Analysis Centers Program Management Office named Booz Allen a prime awardee of a $5 billion indefinite-delivery, indefinite-quantity contract for cybersecurity and information systems support. Almost a year ago, the company won a seat on the General Services Administration and U.S. Cyber Command’s $460 million task-order contract. And in August 2016, Booz Allen won a $379.6 million contract to help the Joint Improvised-Threat Defeat Agency combat improvised explosive devices.

This calendar year is also looking positive, particularly following a recent $96.1 million cost-plus-fixed-fee contract from the Navy’s Program Executive Office for Command, Control, Communications, Computers and Intelligence to support a reliable connection to a communications network at sea.

Vision 2020 is paying off, Labovich said. “It’s actually working out extremely well.”

But besides the buys and wins, he gives a lot of credit to the company’s commitment to its employees, particularly through training and “opportunities for our staff to upscale their skill sets.” The result is workers who feel empowered to innovate, Labovich said.

“Folks were excited about it and it’s leading to much lower attrition than we’d been experiencing in the past,” he said. “Now they know there are opportunities for them to apply new skills and then apply those skills to new projects.”

What’s more, the Digital Solutions division has five digital hubs nationwide providing work environments for about 5,000 digital professionals. These facilitate collaboration on digital solutions for customers. For instance, Booz Allen last month opened a 75,000-square-foot hub in Charleston, where employees can work together on projects for VA and the Navy.

Looking forward another five years, Labovich said it’s likely the growth areas for Booz Allen will change again. After all, DevOps and Agile weren’t hot topics 10 years ago, he added. “I imagine in 2025 we’ll be talking about something new.”

For now, Labovich is keeping an eye on how the Trump administration handles the budget. Booz Allen has customers such as the Environmental Protection Agency that could see significant cuts. But the need to modernize information technology will outweigh these reductions, so he remains optimistic.

“We’re doing mission-critical work,” he said. “We haven’t seen much downslide.”

Just like the new methodologies Booz Allen supports, the company must stay flexible, keeping on top of and ahead of customers’ needs.

“We have always been a company of problem solvers. And as the problems have evolved, we have adapted with the needs of the times,” Labovich said.