CSC certainly has been busy. In late 2015 the firm's US public sector business separated from CSC to join SRA and form the new CSRA. Since then there has been a ramp-up in acquisition activity with the additions of UXC, Aspediens, and Xchanging. And now, the merger with HPE's Enterprise Services segment. And, HPE itself has not been sitting idle. In six months or so, the firm went from being a part of the hardware, software and services giant, Hewlett-Packard, to HPE, the enterprise technology infrastructure, software and services side of the old HP, and is now shedding its enterprise services segment to CSC.
There is no question here that this transaction adds scale to CSC. A lot of scale. Not only will the addition of HPE Enterprise Services propel CSC from an $8 billion company to an estimated $26 billion company, but it will add a huge array of solutions, broaden CSC's geographic reach, and add industry depth. Oh, and will place CSC back within the US public sector. But, will all of this make the new to-be-formed company a better partner to clients? Will the new company be in a better competitive position to go up against the likes of IBM and Accenture?
While the addition of HPE Enterprise Services' solutions, products, depth and breadth undoubtedly are a good thing, there is an area where both companies – combined or not – lag when compared with Accenture and IBM and, more importantly, lack capabilities to address where the IT market is headed. Board members and business executives are increasingly playing a key role in IT investment and budget decisions. To further competitive positioning, it is more important now than ever for a consulting firm to gain buy-in and trust from the business side. This requires the consulting firm to not only be in-tune with the technical aspects of IT services and solutions, but also have the ability to articulate the benefits IT investments bring the business, identify the near-term and long-term value, align IT initiatives to business goals and build a case for investment. A smart next step for this new company would be to build onto its existing technology consulting capabilities to deepen its business expertise and successfully connect the dots for clients between the business and IT.
