Papers presented by Mark Wilson since 2019

2023 Detroit, MI, United States

"Strategy and Structure for a Neoliberal Era: The Rise of SAIC, 1969-2001"

Mark Wilson, University of North Carolina, Charlotte

Abstract:

Lists of top US government contractors in recent years show the continuing importance of suppliers of military hardware, along with the rising significance of health care services. But one top-10 contractor stands as something of an outlier: Leidos, a provider of information technology, intelligence, engineering, and other high-end services. Both Leidos and its sibling company SAIC (also a top-30 US government contractor, today), which together have annual revenues of $20 billion, are successors to the original Science Applications International Corp. (SAIC), founded in 1969 by the physicist J. Robert Beyster. This paper draws on work in a recently-opened collection of the papers of Beyster and the records of SAIC, held at UC San Diego, as well as interviews with several former SAIC executives, defense contract databases, and published materials, to offer what may be the first scholarly essay on the history of Leidos/SAIC. SAIC’s remarkable rise is often attributed to Beyster’s unique genius, its decentralized structure, and/or its unusual model of employee ownership. My paper affirms these notions, while suggesting that we should also highlight two other factors. First, SAIC’s history suggests that successful service contractors may often grow via a pattern of punctuated ascendance, in which success at one bigger-than-normal job can propel a firm into higher tiers of business. (In SAIC’s case, this included its profitable command and control system contract for the Saudi navy, in the early 1980s, and the original $1 billion contract for the Pentagon’s Composite Health Care System, awarded in 1987.) Second, the story of SAIC’s rise must be understood as part of a broader political-economic shift, in which service contractors benefitted from the government’s growing inclination to outsource. In this environment, Beyster’s commitment to decentralization and aggressive revenue growth (needed to sustain the employee ownership model) became a recipe for remarkable success.

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