Top 100: Booz Allen pushes into second century with AI focus

It’s not often that cutting-edge IT is associated with a century-old company, but Booz Allen Hamilton, founded in 1914, broke revenue records in 2018 and is setting itself up for what it believes will be future success in the areas of artificial intelligence (AI) and machine learning.

Last April, Booz Allen won its largest task order – a $1.03 billion deal to expand its support of the Continuous Diagnostics and Mitigation program’s Dynamic and Evolving Federal Enterprise Network Defense. What’s more, the company earned $6.2 billion in revenue last year, a new record since Booz Allen went public in 2010. The company ended its fiscal year 2019 with a backlog of $16 billion, representing a 17.9 percent increase.

The McLean, Virginia-based company has the No. 7 spot on this year’s Top 100 list, with $4.8 billion in prime contract obligations.

The ability to constantly look forward drives the company’s success, said Gary Labovich, executive vice president at Booz Allen. He pointed to Vision 2020, a growth strategy the company put in place in 2013, for pushing Booz Allen leaders to reach new goals in 2018.

“We continue to build our capabilities in primarily four areas: engineering, analytics, digital solutions and cyber, but I think what differentiates us is our ability to integrate our consulting heritage,” Labovich said. “We are the only firm in the market that we play in that has a 100-year history of being a world-class management consulting firm. It’s that perspective, I think, that allows us to combine our technical chops and gives our clients a unique view to the problems that they have.”

Other notable contract wins last year include a $92 million task order to provide cybersecurity and technical support to the Navy’s Information Assurance and Cyber Security Program Office, and a $179 million contract to support Navy’s Commander, Navy Installations Command to provide fleet readiness support, including program management, technology and analytics for the command’s entire portfolio of installation programs.

Another big success was the relaunch of Recreation.gov, which Booz Allen envisioned as an example for how the federal government could redesign websites. It uses human-centered design, agile development, cognitive and cloud technologies, and secure DevOps.

Labovich sees the biggest growth opportunities in AI and other emerging technologies. To that end, the company is making significant investments and he predicts there will be payoffs in the next two to three years.

“It’s not a lot of the same old, same old,” Labovich said of this space. “It’s the ability to continue to evolve cybersecurity capabilities, the ability to reach the digital computer, the ability to get further leverage out of the cloud and of course AI, which has almost unlimited potential.”

The commitment to innovation was apparent in Booz Allen’s opening of an innovation hub in June 2018 in Annapolis Junction, Md., with a focus on cybersecurity – another area Labovich expects to continue to grow.

“Cyber – it never gets old,” he said. “It’s like whack-a-mole. Every time agencies think they have a solution, somebody out there – the ‘bad guys’ – is coming out with a new attack vector.”

Directed energy is a third area ripe for development. It is a defense strategy that uses electromagnetic energy such as lasers and microwaves to either identify a target at a long distance or destroy it. Labovich said the company is well positioned to both build the technology and apply consulting skills to help the Defense Department figure out how to best deploy it.

One challenge that Labovich is monitoring is what he called the “war for talent.” “As you up your game and take on complex projects, you need to find the right people, including people with security clearances,” he said. “That will always be a challenge.”

Still, Booz Allen added more than 1,300 employees in 2018, a 5.7 percent increase year-over-year.

“We feel very confident that we have the talent, we have the know-how, we have the investment capacity to be real players in the technology space serving the federal government,” Labovich said.

With 2020 coming soon, he said the company is starting to discuss strategies for Vision 2025 or 2030, adding that he will have more to say on that next year.

In general, “we’re going to look to continue to differentiate our offering set, continue to play the card of consulting with mission, knowledge and capability expertise,” Labovich said of future plans. “I think the sky’s the limit for us.”