Companies 11-20

11. The Boeing Co.<@VM>12. Booz-Allen & Hamilton Inc.<@VM>13. Dell Computer Corp.<@VM>14. Unisys Corp.<@VM>15. GTSI Corp.<@VM>16. Motorola Inc.<@VM>17. Affiliated Computer Services Inc.<@VM>18. IBM Corp.<@VM>19. BAE Systems Plc<@VM>20. CACI International Inc.

Philip Condit ? $788,334,000

When The Boeing Co. sold its government information services business to Science Applications International Corp. in July 1999, some may have thought its days as a leader in government IT were over.

Not so, according to Jim Albaugh, president and chief executive officer of Boeing's Space and Communications division. The $51 billion Seattle-based company was just changing course to what it believes will be its biggest federal growth market in 2001: information and communications.

In April 2000, Boeing formed a new business called Boeing Government Information & Communications Systems, which concentrates on global positioning navigation systems; airborne early warning and control systems; integrated command, control and communications systems; and integrated battle management systems. The new unit is part of the Government Systems organization, reporting to Albaugh.

The move was especially poignant amid last year's decline in commercial airplane production and deliveries. The company also faced softness in traditional military and space markets. As a result, Boeing revenue slumped to $51.3 billion in 2000, down from $57.99 billion in 1999. Net earnings also slid from $2.3 billion in 1999 to $2.1 billion in 2000.

Despite a declining market, Boeing managed to chalk up some high-profile federal contract wins.

In April, Boeing joined Litton Ingalls Shipbuilding, Sun Microsystems Inc. of Palo Alto, Calif., and team leader Raytheon Co. of Lexington, Mass., to help design and build the next generation of Navy destroyers. Raytheon led what was called the Gold Team in a competition with the Blue Team, led by Bath Iron Works and Lockheed Martin Corp.

The Boeing Co.
Based: Seattle

Chairman & CEO: Phillip Condit

Employees: 198,000

2000 Revenue: $51.32 billion

2000 Net Earnings: $2.1 billion

1999 Revenue: $57.99 billion

1999 Net Earnings: $2.3 billion

In September 2000, Boeing was a key team member in a bid led by Lockheed Martin Corp. for the prestigious Air Force Integrated Space Command and Control contract. Under the contract, worth $1.5 billion over 15 years, Lockheed Martin of Bethesda, Md., and its teammates will integrate about 40 systems into a common, interoperable information technology infrastructure. The modernization effort affects air, missile and space command and control systems.

The program will give commanders at the North American Aerospace Defense Command and the U.S. Space Command a virtual command center, providing a common operational picture of the global battlefield, with real-time data being shared anywhere in the world.

Boeing also has set its sights on developing air traffic control systems. In January 2001, Boeing first revealed plans to help overhaul air traffic control systems in the United States by moving to a satellite-based air traffic control system.

"We have the technology and skills to reinvent the airways with a new, more efficient system of air traffic management," said Philip Condit, Boeing chairman and chief executive officer, in a statement.

The plan has drawn skepticism from companies already building such systems and from the Federal Aviation Administration, which charges that a satellite-based system is too expensive and won't solve the nation's air traffic problems. But Boeing officials insist the company has a proven track record in undertaking big financial commitments.

Boeing also showed in 2000 that it will spend the money needed to bolster its capabilities. In October 2000, the company closed a $3.75 billion cash deal to acquire Hughes Space and Communications Co., a maker of satellite communication systems; Hughes Electron Dynamics, a supplier of electronic components for satellites; and Spectrolab, a provider of solar cells and panels for satellites. Boeing picked up 9,000 new employees with the deal.

Going forward, Condit said Boeing will continue to draw on its expertise as an integrator of complex systems. "We will expand the boundaries of how aerospace is defined in the minds of people everywhere," he said.

? Stacy Collett

Ralph Shrader ? $514,293,000

Booz-Allen & Hamilton Inc.'s government business has grown an average of 20 percent annually over the last five years, according to Alfred Picarelli, senior vice president in charge of the consulting firm's Information Technology Team.

The McLean, Va., company's success can be attributed to its broad expertise in organization and management, information technology and strategy, and also its history ? since 1940 ? in the federal arena, he said.

"We are really committed to working with these clients and making them successful. We make their mission our mission," Picarelli said.

Last year, the private firm had $2 billion in sales, about 60 percent with the government and 40 percent with commercial businesses. About 90 percent of its government sales are to the federal government. Its largest clients are in the Defense Department, including the Army, Navy, Air Force and Marine Corps. The company added more than 1,000 staff during the last year, an expansion largely driven by its government work.

This year, Booz-Allen's government business will grow a little less than 20 percent, Picarelli said, as the company works to acclimate its new employees.

"We'll intentionally slow it down, because it is time to absorb some of the staff we have hired," he said.

Picarelli credits much of the company's position to its employees. More than 90 percent of its jobs net repeat business, he said.

In December 2000, Booz-Allen was named a prime contractor on a National Institutes of Health contract worth $19.5 billion over 10 years. The firm will compete with other contractors to provide IT systems and services for NIH and other agencies worldwide under the Chief Information Officer Solutions and Partners contract.

Last month, Booz-Allen was named one of three prime contractors on the first phase of Trailblazer, the National Security Agency's transformation effort. TRW Inc. and Lockheed Martin Corp. were also named primes. The concept studies phase will define the architecture, cost and acquisition approach to NSA's effort.

Terms of the contracts were not disclosed, but Picarelli said the work should be worth several hundred million dollars for Booz-Allen.

Booz-Allen will be able to capitalize on a trend in government toward purchasing total solutions, Picarelli said.

Booz-Allen & Hamilton Inc.
Based: McLean, Va.

CEO: Ralph Shrader

Employees: 10,700

2000 Revenue: $2 billion

1999 Revenue: $1.8 billion

"This is where our domain knowledge comes into play. We don't provide canned solutions. We look at every client uniquely and try to provide the best solution," he said.

Electronic government and information assurance initiatives will play big in Booz-Allen's efforts this year, Picarelli said.

"E-gov is still evolving as a concept, and we believe this is the year it will really jell," he said.

"Last year, we spent a lot of time helping government look at the possibilities of e-government. Other players did the same thing," he said.

"This year, we are going to try and turn that analytical work into opportunities for real cash flow. ... There are lots of good, creative thinkers on the government side who want to improve government services and responsiveness, and e-gov has the potential to realize some of those goals."

As the government digitizes more information and services, concerns about data privacy have risen to the forefront, presenting new opportunities for the firm.

"The military has been buying [information assurance] for several years," Picarelli said. "We would expect this year that IA will be a much bigger play in the civil side than it has been in previous years. People realize that you can't just make the data available. You've got to protect it at the same time, and you can't protect it so much that you can't get at it."

? Gail Repsher Emery

Michael Dell ? $455,670,000

Dell Computer Corp. sees a healthy future for itself in meeting the enterprise computing needs of its federal customers.

The Round Rock, Texas, company was regarded essentially as a computer hardware supplier just a few years ago. Now, Dell is viewed as capable of providing an enterprise's complete information technology infrastructure needs and more of the services to support those needs, said Thomas Buchsbaum, vice president and general manager of the defense and intelligence business segment.

Indeed, the market opportunity is so appealing, expanding the company's enterprise computing capabilities is one of this year's top priorities for Dell executives, he said.

Dell has enhanced its enterprise computing capability by adding a broad server line that extends from Internet appliances on the low end to high-performance, data center-quality server products and storage on the high end, Buchsbaum said.

The high-end servers "are far beyond what we had a few years ago," said Buchsbaum. He noted that Dell's server offering allows the company to craft more complex solutions with its government customers than it could before.

"From a product perspective, we are assisting agencies with their enterprise computing needs as they migrate away from legacy mainframe systems," added Robert Barr, chief marketing officer of the government business unit.

Dell reported revenue of $31.9 billion in 2000 with net earnings of $2.3 billion, compared with revenue of $25.3 billion in 1999 with net earnings of $1.86 billion. The company has more than 40,000 employees.

In February, Dell completed an internal reorganization of its federal business that resulted in establishing a defense and intelligence systems segment and a civilian segment. This was done "to better reflect the unique needs of our federal customers," Barr said.

Both officials declined to provide segment-specific information, although Buchsbaum said Dell had computer sales totaling $933 million through the General Services Administration schedule.

Dell's largest and most visible enterprise computing project is the Navy-Marine Corps Intranet contract awarded last October. The company, which belongs to a contracting team led by Electronic Data Systems Corp. of Plano, Texas, will provide 360,000 seats and associated networks on the $6.9 billion project.

Dell would not reveal the value of its share of the contract. It will provide services such as network design and architecture, hardware configuration and software loading.

Dell Computer Corp.
Based: Round Rock, Texas

Chairman & CEO: Michael Dell

Employees: 40,000

*2000 Revenue: $31.9 billion

*2000 Net Earnings: $2.3 billion

#1999 Revenue: $25.3 billion

#1999 Net Earnings: $1.86 billion

*Fiscal year ending Jan. 31, 2001

#Fiscal year ending Jan. 31, 2000

"Dell is much more than a product supplier to the [contracting team]," said Buchsbaum.

Dell and Unisys Corp. of Blue Bell, Pa., announced in December 2000 that they planned to expand an existing services agreement into a broader, global alliance involving services, personal computer products and services.

A significant part of the agreement involves the exchange of servers. Dell agreed to acquire and sell Unisys 16- and 32-processor enterprise servers under the Dell brand, while Unisys would acquire Dell's 2-, 4- and 8-processor servers under the Unisys brand.

"The marketplace for the 32-processor [server] is probably not large enough for Dell to develop its own products in a way that would be cost-effective for our customers," said Buchsbaum.

As for its remaining government contracts, Dell has blanket purchase agreements and various small- and medium-sized orders, said Buchsbaum. The company's largest federal customers are the military services, he said.

Mobile and wireless communications, information security and e-government are other federal sector opportunities that Dell wants to capitalize on this year.

"Government agencies will continue to use the potential of the
Internet and integrate it into every aspect of its day-to-day operations," said Barr.

? William Welsh

Larry Weinbach ? $452,018,000

All systems appear go at Unisys Corp.'s U.S. Federal Government Group. Although Unisys considered selling the McLean, Va.-based unit, it decided last month to retain it and take steps to ensure "profitable growth."

Even before the decision, though, the group's management was optimistic about 2001.

"We have set a goal to grow by 10 percent this year," said Daniel Moats, acting vice president and general manager of the group, a goal he called conservative.

Wins by the federal unit in the second half of 2000 and the beginning of 2001 seem to advance Moats' expectation. In January, Unisys was one of three companies awarded contracts to provide the Justice Department and other agencies with information technology support and maintenance services under ASSIST II.

Unisys was the sole contractor on the predecessor contract, during which it took in $150 million in business over five years. It expects to do well on the follow-on contract.

Moats said its conservative business plan calls for revenue of $50 million in contract work for tasks under the indefinite delivery, indefinite quantity vehicle over the next five years.

Unisys also won a multiple-award contract last year from the Internal Revenue Service to provide IT and business management support services under the Treasury Information Processing Support Services-2 vehicle. Unisys is one of the incumbents and the prime contractor on a team that includes PRC Inc., Verizon Communications Inc. and KPMG Consulting Inc.

Unisys Corp.
Based: Blue Bell, Pa.

Chairman & CEO: Larry Weinbach

Employees: 37,000

2000 Revenue: $6.89 billion

2000 Net Earnings: $334.3 million

1999 Revenue: $7.54 billion

1999 Net Earnings: $500.8 million

Unisys expects TIPSS-2 to provide an estimated $20 million to $25 million in business annually over the next five years.

The IRS has been a significant customer for Unisys' IT work. On a team led by Computer Sciences Corp., Unisys is involved in the ongoing modernization of IRS, and last year it completed the agency's Mainframe Consolidation Project.

The latter consolidated 12 data processing centers into two computing centers at Martinsburg, W.Va., and Memphis, Tenn., and 67 mainframe computers into fewer than 20. "One of our core capabilities is systems integration," Moats said.

Another key contract awarded late last year involves work on the Accenture team to provide business systems modernization of the Defense Logistics Agency, valued at about $30 million to $50 million a year.

Unisys also received a contract last year from the Defense Information Systems Agency for the provision of software licensing and technical support for 24 ClearPath IX enterprise servers at the agency's Defense Enterprise Computing Centers. The contract follows on previous work done at DISA's three megacenters.

While revenue for Unisys fell almost 9 percent to $6.89 billion last year ? and net profits were more than halved to $225 million? revenue of the U.S. federal government group declined 20 percent to $689 million.

Moats attributed the decline to the end of three contracts during 2000; a decline in year 2000-related work, which had boosted 1999 revenue; and some waiting last year for the new administration to come in.

Moats said the government group, which now represents about 10 percent of Unisys' business, is poised to become a larger segment of the parent company's overall business this year.

With the squeeze on budgets, federal agencies are seeking ways to become more efficient and to transition to
e-services, he said, areas in which Unisys is a player.

"With the Bush administration, we're expecting even more outsourcing," Moats said.

At one time, Unisys was considered primarily a mainframe provider, but now the government unit gets just 30 percent of its revenue from hardware sales and 70 percent from IT services and e-government solutions.

The group's strengths include its global presence and
a stable, 3,000-strong work force with an average of 8.5 years in longevity, Moats said.

"We have the ability to deliver end-to-end solutions," he said.

? Carole Shifrin

Dendy Young ? $414,228,000

With profits soaring last year, GTSI Corp.'s game plan for 2001 is to advance its standing in the fiercely competitive government information technology market and on Wall Street, company officials said.

The Chantilly, Va.-based IT products and services company, formerly known as Government Technology Services Inc., saw profits rise nearly 300 percent in 2000, said John Spotila, GTSI executive vice president, chief operating officer and general counsel.

GTSI executives are delighted with the turnaround in the company's financial outlook from the mid-1990s, but said that the push to improve will continue. That is because future gains must be achieved "by getting better at what we do, not charging more for what we do," Spotila said.

In February, GTSI Corp. reported it was profitable for the full year for the third consecutive year. The company racked up net income of $10.6 million in 2000, up from $2.7 million in 1999.

Company officials also reported an increase in gross margin percentage, which they attributed to "better contract margins, more effective inventory management and better warranty experience."

"We are intent on growing the company significantly, so at a time when a lot of companies are struggling, we are trying to realign ourselves for overall growth and growth in profitability," said Spotila, who joined GTSI in January after a policy stint in the Clinton administration. Before that, he served as counsel for the Small Business Administration.

GTSI Corp.
Based: Chantilly, Va.

Chairman & CEO: Dendy Young

Employees: 609

2000 Revenue: $677.8 million

2000 Net Earnings: $10.6 million

1999 Revenue: $660.6 million

1999 Net Earnings: $2.7 million

GTSI, the largest reseller of computer products to the federal government, also offers its customers technical support, installation and maintenance services. The company has a vast array of alliances with leading players, including Cisco Systems Inc., Compaq Computer Corp., Hewlett-Packard Co., IBM Corp., Microsoft Corp., Silicon Graphics Inc. and Sun Microsystems Inc.

Company officials said trends at all government levels that place a premium on faster, better and less costly IT products and services play to GTSI's strengths: bringing solutions to customers through its myriad relationships with vendors whose high-end products and services are in strong demand.

"We see tremendous potential to do a better job at this, because there is great customer need," said Spotila, who cited growing government requirements for mobile computers and information security and sweeping electronic government and procurement initiatives.

A major challenge facing GTSI executives in the coming year is how to build on a base of "what has been excellent customer service and taking it to a higher level," Spotila said. Looking ahead, GTSI executives see a lot of growth potential with civilian agencies, and expect to get more active in state and local government.

Like their federal counterparts, state and local government officials "are wrestling with many of the same problems. They're looking for ways to get access to the best IT in an efficient manner," said Spotila, who worked with members of the Federal CIO council in his White House post.

The company has been active in the intelligence space, but executives see the potential for expanding its intelligence business, Spotila said.

More than half of GTSI's business is with the U.S. military, while 35 percent to 40 percent comes from civilian agencies. The balance of the company's IT business comes from state and local governments, but those figures will likely evolve.

Also on GTSI executives' radar screen is a desire to spread word of the company's successes. "We think this is a great story, and we want to get that story out, so making sure we communicate our success" is something GTSI will pay attention to this year, Spotila said.

? Trish Williams

Christopher Galvin ? $373,975,000

Motorola Inc. built on earlier successes at the Defense Department and leveraged its strengths in command, control, communications, computers and intelligence to climb from No. 23 last year to No. 16 this year on Washington Technology's annual Top 100 list.

Although Motorola is best known for its electronics and telecommunications products, the company's Integrated Information Systems Group in Scottsdale, Ariz., focuses on the business of providing communications technology and information technology to government and commercial customers in adjacent markets.

The company excels on the basis of its expertise in developing large, complex communication and high-assurance IT systems for the digital battlefield that integrate to control land, air, sea and space.

Mark Fried, corporate vice president and general manager of the 3,000-employee IISG, said Motorola has a "new clarity of focus," honing in on the military's embrace of communications technology and IT to modernize weapon systems.

Dominating communications technology and IT "will be a requirement for any company that will successfully achieve alignment with the DoD's current transformation vision and U.S. defense procurement budgets," he said, adding that Motorola's engineering talent, core competencies and business strategy "go to the heart" of communications technology and IT dominance.

Those talents came in handy in 2000 when both existing and new contracts were up for grabs.

Motorola Inc.
Based: Schaumburg, Ill.

Chairman & CEO: Christopher Galvin

Employees: 147,500

2000 Revenue: $37.6 billion

2000 Net Earnings: $2 billion

1999 Revenue: $32 billion

1999 Net Earnings: $1.5 billion

Most importantly, perhaps, Motorola retained its hold on the Tactical Air Space Integration Systems, the most advanced mobile airspace management system in the Defense Department, providing integrated air-ground battlespace management based on joint service and information inputs. The total value of the contract with all options and quantities exercised is $150 million.

The group's work on these systems, Fried noted, helped it earn the 2000 Army Aviation Material Readiness Award from the American Association of Army Aviators for a contribution by a major contractor.

The Army also offered Motorola a $50 million extension to the Common Ground Station, a battlefield intelligence and reconnaissance ground processing system built almost entirely from off-the-shelf products.

In June 2000, Motorola successfully demonstrated the system's ability to provide situational awareness and combat identification and to reduce the risk of friendly fire during a limited user test conducted by the All Service Combat Identification Team 2000 at Fort Stewart, Ga.

Motorola also won some new contracts. In February, the company won a $48 million delivery order from the Navy's Space and Naval Warfare Systems Command to build an all-digital, software-reprogrammable radio under the Digital Modular program. This indefinite delivery, indefinite quantity contract boasts an estimated value of $368 million.

Also, the Army awarded Motorola a $49.7 million contract to build the Joint Services Work Station, a real-time, multisensor command, control, communications, computers and intelligence system.

Fried attributed Motorola's ongoing success with defense customers to its innovative design processes, engineering expertise and on-time delivery. The group's integrated systems business earned the Software Engineering Institute's level 5 capability maturity rating in 2000. Achieving the rating, Fried said, "provides our customers with the assurance that they are receiving high-performance solutions that improve operations."

Still, for all of its success this year, Fried said Motorola faces plenty of challenges in the near term, especially in the face of dramatic reductions in defense spending. The trend is forcing the company, he said, "to find flexible, efficient and effective ways to enable superior intelligence and information systems."

Strategically, the biggest challenge in 2001 for Motorola's Integrated Information Systems Group, he said, is developing the appropriate strategy to leverage major programs, target U.S. adjacent markets and grow internationally.

? Heather Hayes

Jeff Rich ? $370,480,000

Affiliated Computer Services Inc. renewed its focus on bringing commercial best practices to the federal government in the outsourcing, electronic government and information assurance arenas and, as a result, managed to crack the top 20 of Washington Technology's 2001 Top 100 List. Winning crucial contracts at the General Services Administration, NASA and the Defense Information Systems Agency, the company jumped from No. 21 in 2000 to No. 18 on this year's list.

"Our strengths as a federal contractor mirror those of ACS as a corporation," said Harvey Braswell, president of the company's Government Solutions Group in Rockville, Md. The company, he said, is taking lessons learned from the commercial world to the federal sector.

"That's exactly what our customers are looking for, especially when it comes to business process outsourcing, which is a new trend in the government," he said.

Indeed, its strength in outsourcing helped fuel the company's 12 percent growth last year to more than $617 million in revenue: Not surprising since the overall corporation's roots are in the mainframe outsourcing business.

The federal group, which makes up nearly a third of the $2 billion Dallas-based ACS, captured two of the year's biggest offerings. The division was selected as prime contractor on a $120 million delivery order under NASA's Outsourcing Desktop Initiative (ODIN). It also received one of 10 indefinite delivery, indefinite quantity (IDIQ) contracts under the $20 billion GSA Millennia Lite Contract to provide IT planning, high-end IT services, mission-support services and legacy systems migration and new enterprise systems development.

Meanwhile, the Government Solutions Group, which has more than 5,300 employees in 30 offices nationwide, covered new ground in its quest to become a leader in e-government solutions in 2000. The division:

Affiliated Computer Services, Inc.
Based: Dallas

Chairman & CEO: Jeff Rich

Employees: 20,000

2000 Revenue: $2 billion

2000 Earnings Before Taxes: $212 million

1999 Revenue: $1.8 billion

1999 Earnings Before Taxes: $165 million

? Completed an online reverse auction site for the Defense Finance and Accounting Service under GSA's portal;

? Earned raves for its Direct Loan Servicing System, which in just six months helped save nearly $550,000 in postage, fulfillment and telecommunications expenses for the Education Department;

? Won a $2.9 million award to implement a database and interactive Web site for the Labor Department's Employment Assistance Referral Network.

Armed with a new information assurance solution known as ACS Assurance, the Government Solutions Group also set its sights on the security market and made solid strides with two awards. It was named prime contractor of a slice of the $1.5 billion I Assure contract, a multiyear task order contract put out by the Defense Information Systems Agency to provide information assurance services and solutions to federal agencies worldwide.

The division also won a contract to support the Energy Department's Security Operations Office in the provision of information assurance services.

In June 2000, ACS enhanced its services capability by acquiring the Intellisource Group Inc., an IT solutions provider that earned fame as the winner of the first-ever NASA ODIN seat management contract. Intellisource complements ACS with its skills in systems integration, network and distributed systems and systems solutions development.

International Data Corp., an IT research firm in Framingham, Mass., predicts the government outsourcing market will double in the next five years, from $1.7 billion to $3.3 billion. ACS, said Braswell, is well-positioned to take advantage of this growing market. He has set a goal for the Government Solutions Group to grow an additional 20 percent in revenue in 2001.

"I think our philosophy of providing quality service through the added value of hiring the best talent in the marketplace and providing the best technology are what government really wants delivered right now," Braswell said.

? Heather Hayes

Louis Gerstner ? $359,410,000

IBM Corp. has been a prime contractor to the federal government since the company's inception: Its precursor helped automate the 1890 census. More than a century later, IBM has helped the U.S. Census Bureau make the first census data available on the Web.

That long tradition of service to government continues, with IBM ranked No. 18 in Washington Technology's Top 100 list for 2001, with about $359 million in prime contracting dollars during fiscal 2000.

IBM does not release revenue by sector, but the firm's government business has grown at a pace faster than the market itself over the past year. It has plans to grow at double the market rate this year, said Anne Altman, managing director, U.S. Federal for IBM's Public Sector in Bethesda, Md.

IBM addresses the market "not just through services and consulting, but with solutions as well," said Altman. She wants the market to remember IBM's "tremendous technology. Today, that technology sweet spot is in Web servers, Web application software and emerging areas such as Linux and security."

IBM's Public Sector division has spent the last year "restructuring our team to focus more through our partners, teaming with federal systems integrators and becoming more knowledgeable about drivers, the issues our government customers face," said Altman.

The division is organized into seven business segments according to subject matter. For example, while the division does maintain a Defense Department unit, its health and social services unit would address the systems needs of the Defense Department's medical departments.

As part of the division's restructuring, IBM in July 2000 announced a Government Specialty for e-business designation for business partners, recognizing their ability to provide strong government applications compliant with IBM's government portal architecture and application framework for e-business. Seven integrators have since been named to the program.

With nearly half of the federal work force becoming retirement-eligible by 2004, agencies are struggling with how to maintain their intellectual capital, Altman said. IBM is addressing this through its services and integration capabilities, as well as with collaborative and knowledge management solutions.

IBM Corp.
Based: Armonk, N.Y.

Chairman & CEO: Louis Gerstner

Employees: 316,303

2000 Revenue: $88.4 billion

2000 Net Earnings: $8.1 billion

1999 Revenue: $87.5 billion

1999 Net Earnings: $7.7 billion

An implementation of Lotus Notes with the Navy, for example, is providing the backbone for collaboration at sea.

Altman said IBM is "investing an enormous amount in security," including services and consulting, product technology and research in conjunction with federal customers. "CIOs are really worried. They will spend a tremendous amount of money in the next few years," she said.

IBM's response to government customer needs can be seen in the breadth of large contract wins over the past year.

IBM won a contract with the Agriculture Department for a broad-scale deployment of more than 2,000 I-Series servers to beef up infrastructure, including messaging and distributed systems management.

The company is also assisting the Navy, Energy Department, the U.S. Mint and the U.S. Postal Service with transformational applications that lay the groundwork for applications such as enterprise resource planning, customer relationship management and electronic procurement portals.

IBM's technical acumen is illustrated by high-performance computing contracts with the departments of Defense and Energy. In 2000, for example, IBM delivered a supercomputer to the Lawrence Livermore National Laboratory that includes 8,192 microprocessors, stores 160 terabytes of data, performs 12.3 calculations per second and is the size of two basketball courts.

At press time, the public-sector division was awaiting word on another large contract, the Customs Modernization Program, a $2 billion opportunity to help the Customs Service transform to e-government. IBM, as prime contractor, would partner with Lockheed Martin Corp., KPMG Consulting Inc., Computer Sciences Corp. and Sandler & Travis Trade Advisory Services Inc.

? Lisa Terry

Richard Evans ? $331,044,000

Buoyed by a dominant engineering and support contract from the U.S. Federal Aviation Administration, BAE Systems Plc will press forward in the government systems market by exploiting acquisitions and securing larger wins.

"There is an overall strategic objective to move up the food chain, to actually go after and win larger contracts and programs in the systems area," said Robert Stow, vice president of engineering and technology, BAE Systems North America.

The global systems, aerospace and defense company based in Farnborough in the United Kingdom, seized the No. 19 spot on Washington Technology's Top 100 list. Formed in November of 1999 with the merger of British Aerospace and Marconi Electronic Systems, BAE Systems makes no bones about its ambitious aim to be "the benchmark systems, aerospace and defense company worldwide."

The 10-year FAA contract announced last August was a boon to BAE Systems North America, Rockville, Md., which wants to broaden its reach in the outsourcing arena.

"We have a significant footprint and capability in government outsourcing, and this happens to be a win in that area," Stow said. The FAA's System Engineering and Technical Assistance (SETA-II) contract, worth $454.4 million, also marked a "take away" from the incumbent contractor, TRW Inc. of Cleveland, he said.

The contract is broad in scope and covers assistance to a wide range of FAA organizations. The company will support selected programs in the U.S. national airspace system architecture and perform systems engineering, acquisition management and program management support services.

The company also landed a prime role in 2000 on an Army effort to develop a next-generation, joint tactical radio system, Stow said.

Last year, BAE Systems North America acquired the Control Systems and Aerospace Electronics Systems businesses of Lockheed Martin Corp., Bethesda, Md., for $2.3 billion. The Control Systems business deal was finalized in September 2000; the AES deal was sealed in late November.

These acquisitions are part of the company's strategy to solidify its position in the U.S. defense market. The North America unit generated revenue of $3.7 billion in 2000, up from $2.3 billion a year earlier. Approximately 85 percent of the unit's total sales come from U.S. government customers; the rest comes from its civil aviation business.

BAE Systems Plc
Based: Farnborough, U.K.

CEO: Richard Evans

Employees: 120,000

2000 Revenue: $18.3 billion

2000 Net Earnings: $1.4 billion

*1999 Revenue: $13.4 billion

*1999 Net Earnings: $1.2 billion

*Only counts one month of the merged BAE Systems

The North America unit's 18,300 employees support an array of products and services for government and commercial customers. These include business information systems, communications and data links, electronic warfare systems, avionics and navigation, technical support, simulation and training, engineering support and advanced aircraft development.

These days, company officials are eagerly awaiting the planned spring award of the Air Force's C-130 avionics modernization program contract. BAE Systems is pursuing a prime role on the multibillion-dollar program to upgrade the transport aircraft. Its rivals are Boeing Co. of Seattle, Lockheed Martin, and Raytheon Corp. of Lexington, Mass.

Approximately 519 aircraft are candidates for the upgrade, but there is a potential for international upgrades later, company officials said.

Besides outsourcing, BAE Systems hopes to capitalize on the growing trend by government customers to procure total solutions. "Our government customers are moving more and more toward finding total solutions, not just buying products," Stow said.

Such solutions can tie together different systems into a system of systems. "When you think of what government, and particularly military missions are, they are increasingly addressing how do you link the various parts of the force structure together to become a system of systems," he said.

The fusion of sensor data communicating in real time or C4ISR (command, control, communications, intelligence, surveillance and reconnaissance) is "one of the areas we are playing in and one in which we think we have some differentiating technologies," Stow said.

? Trish Williams

John London ? $318,502,000

With acquisitions in strategic areas fueling growth, CACI International Inc. has captured the No. 20 spot on Washington Technology's Top 100 list, up from No. 30 last year.

The Arlington, Va., company had overall revenue of $490 million in 2000, and this year its new acquisitions will help push annual revenue above $550 million, said John "Jack" London, CACI chairman and chief executive officer.

The success of the company's acquisitions has been a particular bright spot, he said. "There have been no disappointments, no significant problems," he said. "Sometimes you have to pinch yourself to make sure it's real."

In the past year, CACI has acquired four companies: Xen Corp., Century Technologies Corp., Radian International LLC and NET Federal Inc. Those companies were doing work in areas such as intelligence, information assurance, communications and network management, key areas of growth for the company, London said.

Past acquisitions, such as the 1998 deal that brought in QuesTech Inc., also paid dividends in 2000.

The company won a pair of five-year contracts from the Army Communications-Electronics Command that could be worth a total of $500 million. The contracts are recompetes of work that QuesTech brought with it when CACI acquired it, London said.

The company also won a five-year, $48 million contract with the Air Force to help with research in areas such as command and control, information assurance and intelligence services.

"We've had several wins that have an intelligence and information assurance flavor," he said. "These are new lines of business that CACI has rolled into its offerings since 1995."

London said the company will continue to be an aggressive acquirer and has a $150 million line of credit in place with which to make deals. "We have a very comfortable balance sheet," he said.

CACI International, Inc.
Based: Arlington, Va.

Chairman & CEO: John "Jack" London

Employees: 5,000

2000 Revenue: $490.5 million

2000 Net Earnings: $44.2 million

1999 Revenue: $433.4 million

1999 Net Earnings: $38.2 million

Most of the companies CACI is targeting as acquisitions have revenue in the $50 million to $80 million range. "We see a number of opportunities out there, so we are pretty much in constant pursuit," he said.

London is looking for companies that can bring communication, network management, information assurance, security and intelligence capabilities. But the new lines of business are not distracting CACI from its traditional work, London said.

"We must re-win our current business," he said. "The difficulty of replacing a significant loss can be traumatic."

One of the company's top priorities is winning the recompete of the Justice Department's Mega 2 Automated Litigation Support Services contract, he said.

Under the first contract, awarded in November 1996, CACI had won $225 million in work through September 2000, according to the market research firm Input Inc. of Chantilly, Va. An award is expected by September.

CACI is providing communication and database development services for the Justice Department. Other capabilities CACI offers include software development and systems integration services.

London said the changes the federal government is undergoing, particularly within the Defense Department, bode well for CACI's growth. The Defense Department is the source of about 55 percent of CACI's revenue. Another 35 percent comes from civilian agencies, with the remainder coming from commercial and international work.

President Bush has ordered an examination of the military's force structure, which should be completed within a month. In September, the quadrennial review of the Defense Department will be completed.

London said he doesn't expect more money to be given to the Defense Department, but "I think we'll see a reallocation of existing resources."

More money is likely to go to space systems, intelligence collection and missile defense, which means more emphasis on communications and networking, he said. "This can provide a nice opportunity for us," he said.

? Nick Wakeman

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