Eye on the States: Solutioning your way to the top

Thomas Davies

Every year following the release of Washington Technology's annual list of "Who's Who in the State and Local Market," (March 10) I hear the same question: How do they do it? I get this especially from companies struggling to grow their businesses.

This year was no different. A cursory glance at the list of those recognized as the top integrators in this market suggests the companies have a lot in common. Many of them have broad reach into the market, supported by national -- in some cases global -- sales and delivery. They also have years of experience working with state and local governments, with some customers stretching back almost four decades. And most are renown for having best-in-class capabilities, technology and people.

But to understand how these companies have grown, you need to examine what fueled their growth. A key ingredient is highly replicable, best-of-breed solutions tailored to the state and local market.

The solutions these companies are known for, and in many cases may have pioneered, is quite impressive. Affiliated Computer Services Inc. has blazed trails in parking enforcement, welfare and work-force services and toll-collection solutions. Electronic Data Systems Corp., Unisys Corp. and ACS are all well-recognized for bringing Medicaid fiscal agent and claims processing solutions to this market. A pillar of growth for American Management Systems Inc. has been its financial management solutions, which are used by many of the largest state and local governments.

Just look at the companies who have entered the state and local market over the past decade. Those such as PeopleSoft and SAP got in by leading with their solutions, and now they have substantial market share. Some of their competitors, who tried to compete on technology and not solutions, have fallen far behind.

Failure to focus on solutions is one reason many companies are disappointed with the homeland security market. They have been trying to figure out what technologies the government wants to buy instead of what solutions state and local governments need. One company that has avoided this trap is Northrop Grumman Corp.

Northrop Grumman has a public safety command center solution that has been adopted by some of the largest U.S. cities, such as Los Angeles and Atlanta. But it's not only responsible for the radio systems, the networks, designing and building the physical facility and ongoing support. The company also helps its customers find financing. In tough fiscal times this is just what the doctor ordered. Not surprisingly, Northrop Grumman is looking to expand the command-center business in both the public safety and transportation markets.

Telecommunications is another segment to watch in the technology industry. AT&T Government Solutions is taking a refreshing solutions approach to this market. For example, in Indiana it has implemented its Federal Grant Management Solution to support the state's E-Rate federal grant program. The solution manages requests from schools to order equipment and services, for billing the federal government and other entities and for settling payments and providing audit compliance support.

While not all companies grow their state and local business solely through solutions, it is a hallmark of those who have been able to sustain their growth and market leadership over many years, in both good and bad times. From the perspective of their customers, these companies are known more for their best-of-breed solutions than by their annual revenues or number of employees. And, for my money, it's also why their names show up year after year on the list of who's who. *

Thomas Davies is senior vice president at

Current Analysis Inc. in Sterling, Va. His e-mail address is tdavies@currentanalysis.com.

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