Unisys CEO plots secure future for 144-year-old firm
Business Management

Unisys CEO plots secure future for 144-year-old firm

Unisys is a company with a long back story, its roots and tendrils stretching as far back as the 19th century and the American Arithmometer Company which later became Burroughs – the controversial writer William Burroughs was a scion of the dynasty. Unisys was formed when Burroughs combined with its rival Sperry in 1986, a deal that was one of technology’s first mega-mergers.

Unlike most of its generation, Unisys is still here but its current focus is a swing away from its long history. Today it is attempting to pull off another change of identity and when I meet Unisys CEO Peter Altabef he wants to stress that the company is all about security.

Of course, information security today is the gift that keeps on giving for suppliers of software, appliances and services. My journey to the Park Lane hotel in London where we are scheduled to meet is even delayed by security checks as if to underline the challenges we all face today. But Altabef notes that it’s curious how only his company of all the giants that participate in IT services puts security on the masthead. ‘Unisys: Securing Your Tomorrow’ goes the tagline.

That’s a fact. There are many IT consulting services companies from Accenture to IBM and CSC but only one big brand is focusing explicitly on infosec. That might be a smart idea for Unisys, a company that, it seemed to me, suffered something of an identity crisis through the Nineties and Noughties. In those years it stopped making PCs but seemed an odd combination of software, powerful servers – based on its own IP – and services.

Altabef arrived at the company at the beginning of 2015 and says his first job was to sort through a forest of SKUs the company offered.

“It’s a 144-year-old company, a storied organisation in the history of IT and computing,” he says. “My mandate coming in was to look hard at the business and develop a new organisation and business model for the future.”

Altabef’s bet was that narrowing down to focus on fewer areas would make sense.

“We can’t be all things to all people and we have demonstrable IP and domain knowledge,” he says. “The problem with Unisys is we had too many of those families of software solutions. A company of our size has no right to do more than a quarter of that number.”

“Our size” pegs Unisys as a $2.8bn revenue business that is still cutting hundreds of millions of dollars of costs. Shortly after our meeting the company missed its Q2 earnings forecast but said it is still on track to deliver $2.65-2.75bn in revenue. This appears to be a classic case of refocusing and creating a profitable operation rather than focusing on top-line growth.

Altabef has the right pedigree for this sort of turnaround, having earned his spurs at Perot Systems, the services company run by former US presidential candidate Ross Perot, of whom he recalls.

“Ross Senior is one of those people that when you have an opportunity to work closely with him you already know what stories you will tell your grandchildren even before your children were conceived and married.”

Why did Perot run for POTUS?

“At his heart because he was a patriot and felt he could help with where the country was headed,” Altabef suggests. “One of his defining characteristic was [seeing the CEO role] as that of a ‘servant leader’, and he would have done the same in politics. He would make it a point to deal with the person personally and in a straightforward manner of equals. He would go just as far out of his way for an administrative assistant whose spouse had medical problems as for direct reports.”

When Perot Systems sold to Dell in 2009 Altabef also had the chance to work with Michael Dell, another leader he admires: “He has totally reinvented that company and ultimately the merger is very successful.”

However, he doesn’t feel that he will need to lean on too many lessons to rebuild Unisys.

“I don’t think this is rocket science,” he says, pointing to the example of Cognizant as a company that can adapt as circumstances change.

The modern shifts to cloud, mobile working and shorter consulting engagements create what might appear to be a perfect storm for consulting firms but Altabef likes his chances.

“It’s a huge change and, without being flippant about it, you can join in that change or it will roll over you.”

He believes that even large government agencies will move to the cloud and says that security micro-segmentation within AWS and Azure makes that a low-risk switch. The nature of outsourcing is changing, he says, with the old, often antagonistic relationships replaced with shorter deals and even the ability to change and modify relationships even within the contract term.

Today, the “as a service” model prevails and “you have to take a page out of the Salesforce.com playbook”, he says, with TCV (total contract value) moving to ACV (annual contract value) as a key metric.

“I think we’ve done a good job focusing on the verticals and horizontally leveraged cloud migration, security and analytics, and getting our cost structure to be relevant. It’s simply doing what we’re doing better.”

The issue with security is that it never goes away: that’s good for vendors but bad for the rest of us, I suggest.

Altabef demurs, saying that groups such as standards body NIST and legislation such as GDPR show that there’s good work going on. And even at the C-level there’s recognition that resiliency at all levels I necessary. “The idea that the firewall is the Maginot Line is going,” he says.


«C-suite career advice: Balázs Scheidler, Balabit


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Martin Veitch

Martin Veitch is Editorial Consultant for IDG Connect

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