TRW's Systems & Information Technology Group should be pulling in $6 billion annually by 2002, said Philip Odeen, executive vice president and general manager of the new unit.
"We want to see a lot of growth," said Odeen, who expects new state and local business and commercial work to lead that expansion.
TRW, a global manufacturing and service company that employees 79,000 people, has focused on high-technology and engineering products for the automotive and space and defense markets. Indeed, the automotive sector accounted for roughly $6 billion to $7 billion of its 1996 revenues of $10 billion.
That focus will be refined as the purchase of BDM opens new markets in the civil sector and positions TRW to offer new services, company executives said.
But the $23 billion annual federal market, with its lucrative integration and outsourcing projects, will remain the bedrock of the unit's revenues, said Odeen, former president and chief executive of BDM.
The company's BDM purchase boosted overall revenues to $11 billion in 1997 and makes TRW the fifth largest federal systems integrator, company officials said.
Acquisitions also are part of TRW's growth strategy, especially on the commercial and state and local fronts, Odeen said. The company's top priority is to buy firms in the integrated supply chain area.
Between now and July, TRW officials will develop a long-term strategy that includes acquisitions, Odeen said.
Earlier this week, TRW credited the BDM acquisition for helping lift first quarter 1998 revenues by 16 percent compared to one year ago.
In its latest financial report, TRW reported overall first quarter revenues of $3.1 billion, up from last year's $2.7 billion.
First-quarter profits rose 8.5 percent to $129.4 million from the same period one year ago led by record sales and cost-cutting measures after the acquisition of BDM.
While guiding the company on its growth path, Odeen also has the daunting task of fitting together the pieces of BDM and TRW. Turnover and attrition are issues that loom when two companies merge but conflicts at TRW appear to be minimal, analysts said.
"The most critical issue is how do you blend the pieces," said Thomas Meagher, an analyst with the investment banking firm, Ferris, Baker Watts of Washington.
A management team led by Jack Distaso, a TRW vice president, dumped an earlier idea of operating TRW's IT unit and BDM as separate entities, Odeen said.
"We recognized it didn't make sense to run them in parallel," Odeen said. "There are a lot of overlapping skills and experiences, so we were going to be tripping over one another and probably competing."
The best approach is to move quickly, said Robert Dornan, senior vice president of Federal Sources Inc., a McLean, Va.-based market research company.
"Stretching [integration] out just lets things fester," Dornan said. "By getting on with it, people can worry about doing business rather than jockeying for position in the company."
Howard Rubel, an analyst with the investment company Goldman Sachs of New York, noted: "There doesn't appear to be a lot of infighting going on."