Unisys Takes 'Stealth' Approach to Comeback Trail

By Darryl K. Taft  |  Posted 2016-02-23 Print this article Print
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In terms of where Unisys does its work, it’s always been global. Unisys serves customers in 180 countries around the world. Fifty percent of its revenues come from the U.S. and Canada, about 29 percent from EMEA, 11 percent from Asia Pacific and 10 percent from Latin America.

Altabef took a programmatic approach to reorganizing Unisys and did so in a somewhat “unorthodox” manner.

“Because the first thing I did was actually around the organization,” he said. “The reason was because the company is 142 years old and had been larger in the past; it still had a host of different organizations. It was almost a spider web all reporting to different people up to the CEO. We had more P&Ls than you would expect. So, organizationally, the first thing we did was consolidate and streamline to two go-to-market organizations: One for the U.S. federal government, which is about 20 percent of our revenues, and another for the rest of our clients, which is about 80.”

Altabef then made some changes in leadership, bringing in new blood to augment existing staff, as well as trimming some areas. Next he set out to bring the company’s cost structure in order.

“As a company with a very long legacy, we had some mismatches in our cost structure,” he said. “So we announced a reorganization that will take out $200 million of run-time annual cost plus more, and that more we will reinvest back into the business. This will both return profit to shareholders and provide more money for investments to fund our growth and higher value solutions.”

Altabef’s plan has several imperatives: To win in key markets, deliver operational excellence, speed decision-making and drive cost effectiveness and fund the future by focusing on key verticals and using Unisys existing intellectual property.

“The energy industries we serve are highly competitive, and Unisys services give us an edge,” said Tim Hostman, vice president of end-user services at Flowserve, a Unisys customer. “Through its comprehensive service management and innovative analytics capabilities, Unisys gets the right services to the right people in the right way so they stay consistently productive while delivering predictable cost efficiencies that enable us to make key IT investments for our future.”

In order to deliver highly differentiated, solutions to clients’ most pressing and complex problems, Unisys moved to realign and invest in vertical industries, initially focusing on three verticals. These are the government sector, which includes both the U.S. federal group and the public group in Unisys Enterprise Solutions, representing 44 percent of Unisys revenue; the commercial sector, which represents 35 percent of Unisys revenue, and the financial services sector with 21 percent of revenue.

Software is Key; Security is Paramount

Altabef also quickly realized that software is a big part of what Unisys does.

“Every company needs to look for distinctiveness,” he said. “For us, even though the majority of our revenue is from IT services, the way we deliver those services and what we deliver is increasingly focused on software-led services. So we just don’t want to be a typical, generic IT services company. So the fact is we have this amazing wealth of software – 25 percent of the world’s airline reservations are done on our systems. We believe we have the largest data warehouse built on Oracle. These are really impressively developed software implementations. We’re using software to really drive the company.”

Within that software expertise, it is the company’s prowess in security that stands out. Unisys is known for its ClearPath Forward architecture and super-secure operating system. The company’s latest splash in the security space is its Stealth technology. The National Institute of Standards and Technology (NIST) ranked Unisys’ ClearPath OS 2200 and Unisys’ ClearPath MCP as two of the most secure operating systems on the market. Unisys software uses identity-based micro-segmentation techniques and encryption to protect data and applications. Stealth protection makes data and applications invisible to hackers and unauthorized users by encrypting traffic between all Stealth-protected endpoints. Companies and governments have been long advised to ‘segment’ their networks, so that an attack on one segment can’t affect the rest of the network.

“So we have this legacy of really strong security,” Altabef said. “We’ve been able to take that legacy of security and build it not into a proprietary operating system, but in Stealth a security package that goes into any operating system and in any environment. That’s pretty powerful stuff.”

“Unisys’ focus on security and knowledge of critical infrastructure related industries were important factors in our decision to become a client,” said Richard A. Loew, CIO of PBF Energy. “They are a company with a long tradition of innovation that continues to this day.”



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