Why Computer Sciences Corp. Became an E-Solutions Provider

Early adopters sometimes do get the worm. At least that's what Computer Sciences Corp., El Segundo, Calif., found out when it shifted its business model from a strict IT consultant and systems integrator to an Internet-based organization.

The company has been in business for 41 years, spending the majority of that time as an information systems company. Like other systems integrators, though, the company saw the writing on the wall with the coming of the Internet Age, and decided to morph its business. The question at the time was, is this the right move or a giant misstep?

"[In the early 1990s], we saw [the Internet] as a technology that would allow open access to new markets and the creation of new business channels, as well as the ability to [address] competitive threats," explains Mike Klaus, vice president of consulting and head of e-business strategy services at CSC. "We positioned ourselves in 1996 to take our consulting systems and integration group and move that entire business to the Internet economy." For CSC, the gamble paid off. Last year alone, the company did close to $700 million in e-business-related activities.

Klaus says understanding the Internet from the ground up allowed CSC to work more cohesively with those of its clients that were interested in pursuing a Web strategy early on. "It opened a wealth of opportunities for our clients, so we began to train people to understand the technology," he says. "[That way], we could address those issues from a factual basis rather than from a theoretical basis. [At the time], we knew the Internet would cause a change, but I don't think anyone could have guessed it would cause this much change."

Key for CSC was not getting stuck in the old "if it ain't broke, don't fix it" mentality that a number of its competitors adopted when the Internet made its debut. Too many companies have stuck to what they thought was a safe, successful business model despite the growing market shift, resulting in a plethora of mergers, takeovers, bankruptcies or, if they're lucky, just a rocky road to travel while they make a late transition.

CSC avoided all that by being willing to take a risk, and knowing which risks to take. The company's first move was into the small business arena, helping these companies compete with their larger--and hopefully slower-moving--competitors. Another market CSC thought would offer great opportunity was startup companies that provide services to larger firms.

CSC's crystal ball proved to be accurate, and today, the company boasts clients in both the government and private sectors. The company supports agencies like the National Security Agency and NASA, as well as various branches of the military. "These are truly mission-critical systems," Klaus says. "People can die [if they fail]. It's different with the military. Not having a supply there on time can mean the difference between life and death as opposed to an outage on a shelf [that means a lost sale]."

Today, CSC continues to spend a great deal of time and money on research into future technologies. Many of its clients act as joint research partners. Klaus says CSC wants to be on the forefront of whatever comes along five to 10 years down the road.