NTT DATA closed its estimated $3 billion acquisition of the former Dell Services business in November 2016 to expand information technology services and consulting work for public sector agencies with the backing of a global IT company.
Shortly after the deal’s March 2016 announcement, NTT DATA Public Sector President and 2017 Wash100 inductee Tim Conway told ExecutiveBiz the company will seek to apply its intellectual property portfolio in research-and-development work for agencies in an effort to differentiate itself from other pure-play government IT businesses.
Conway recently updated ExecutiveBiz on the process of integrating both businesses in this conversation that also included topics such as R&D priorities for the newer and larger NTT DATA and new customer areas Dell Services brings, along with his views on how NTT DATA’s status as a global systems integrator helps it in the public sector market.
ExecutiveBiz: What stage of the integration process is NTT DATA in and how are you positioning the newer, larger company to agencies?
Tim Conway: We are in the middle of the integration. The first phase defined the future organization, now our focus is on building a $750 million public sector business that is positioned for consistent growth. We had a tremendous reception from our clients. Many of the Dell clients find the prospect of engaging with a true services company exhilarating.
As a company, we are poised to partner with our clients by offering a depth and breadth of IT resource skills and capabilities that few companies can match. We can support our client's missions with an extensive portfolio of systems integration technology capabilities, direct client experience and diverse contract vehicles.
From that standpoint, we combine NTT DATA's strengths in advisory services to the innovation, development, maintenance, support, and modernization of applications with the strength of Dell Services’ infrastructure, security, cloud, and IT outsourcing.
Given what we have to offer, the positioning with large agencies really comes down to listening to what our clients need and communicating how we can help.
ExecutiveBiz: What major new customer base and workforce skill sets has Dell Services brought?
Tim Conway: The combination of NTT DATA and Dell Services Federal Government was very complementary – in terms of customers, capabilities and contract vehicles. We only had one client where we actually had an overlap, the FBI. Dell Services brings to us excellent qualifications in defense, intelligence, education, federal healthcare, energy, NASA and FEMA.
On the legacy NTT DATA side there is also defense and intelligence business, but again no overlapping clients in that segment. NTT DATA also has additional depth in criminal justice agencies, Homeland Security and the SEC. Dell Services holds a FedRAMP certification and made investments in new application renovation and modernization tools through the acquisitions of Make Technologies and Clerity Solutions.
Those technologies and resources will assist us in the modernization of legacy applications for our government clients. NTT DATA's standing in the applications space and Dell's in infrastructure space come together perfectly to align and better serve government clients.
ExecutiveBiz: How does the new NTT DATA differentiate itself from other government IT companies?
Tim Conway: To me it is a stark contrast. You have a lot of companies that have come together for pure-play federal business. Throughout history, the information technology segment was driven by government through investments made into advanced technologies. The Internet was a government investment and became a market unto itself in the 1990s.
Since that point industry investments have outpaced the government. In fact, in technology companies like NTT DATA, the quest for innovation has become the business model and a critical element to differentiating in the market.
A global company like ours sees the challenges the world faces, makes real-time research and development investments, and creates products and offerings that help solve the most pressing issues. NTT DATA is positioned to take advantage of investments made throughout the world in the commercial market and apply them to the betterment of government.
ExecutiveBiz: What are some priorities in place for research and development?
Tim Conway: We currently have three R&D priorities. The first revolves around security. Forty percent of the world's data traffic goes through our equipment, we have a front row seat to what is going on in the world. We have made significant R&D investments into creating a platform to protect our clients from threats in the global market.
Our Global Security Threat Index out of our Palo Alto research facility is tasked with helping our customers be prepared and equipped for threats at large. We can use our artificial intelligence-based cognitive platform to secure diverse client environments, respond to any security incidents and conduct cyber forensics on the threats. Of course it is about prevention first, but also investigation and response when an incident occurs.
A second priority is in the healthcare space. For example, we use technology induced fabric to provide a wealth of health information. We applied an electro-conductive polymer to nanofibers, creating a special fabric that acts as a sensor to capture bio-signals from wherever it is placed on the body: heart, muscles and even the brain.
The sensor fabric is called hitoe. It was first used to produce an athletic and workforce shirt and a sports bra, with the information collected being used to make determinations about the health and well-being of the individual wearing it.
Hitoe originated out of an R&D project in Tokyo after the 2011 tsunami, when NTT DATA scientists were trying to collect information about the impact of radiation on the human brain. It has since evolved into the sensor fabric that captures bio-signals. NTT DATA sponsors IndyCar series driver, Tony Kanaan, who wears a fire-resistant version of the shirt to provide information about his heartbeat, stress levels, posture, and muscle tension as he drives.
Combining the information from hitoe with the car's own telemetry system, we show Tony where he is gripping the wheel too tightly or how to breathe through particular turns under strong G-forces to help him stave off fatigue longer.
True story: I demoed one of the shirts and the electrocardiogram indicated my heartbeat wasn’t right. I texted the video image of the ECG to my doctor who then prescribed a 24 hour Holter monitor that confirmed I had an irregular heartbeat““which I would have never known. I know first-hand how amazing this technology is, think about it.
Imagine this kind of technology in the government workforce. A warfighter could wear the shirt to monitor stress on the body or determine when fatigue affects a person’s ability to carry out a mission. We don't make the shirt but use the data to create valuable use cases.
A third R&D area is big data. We are investing in developing a NextGen data platform to harness and analyze data to make effective decisions. As an example in government, we have invested in applying this platform to provide intelligent transportation. At federal, state and local levels we are delving into smart roads, congestion management and data analytics.
Beyond what Waze does, it’s about influencing people's behavior and applying the Internet of Things to reroute traffic or change the traffic signals to alleviate congestion. Getting the data is only the beginning. We are working on the use cases to make the data meaningful to facilitate timely decisions or drive behavior. The amount of data available for decision making is growing exponentially, we are poised to help our clients use data effectively.
ExecutiveBiz: How do you see the role of systems integrators and IT services companies like NTT DATA evolving in the federal space?
Tim Conway: I see the role of systems integrators as mission providers. Technology is the enabler to automate regulation and the business processes associated with government. We have all seen articles about how automation is significantly reducing resource requirements in industry, manufacturing and ultimately in government.
The question is, how do we get there? GAO says about 80 cents of every IT dollar in the government is spent on keeping the lights on and the systems up and operational. The role of IT systems integrator is to drive the modernization necessary to reduce operational costs and enable these savings to be investments into digital transformation.
The government of the future will allow citizens to interact with federal, state or local agencies through a handheld device. That is certainly an expectation of the millennials as they don't understand why they have to call or visit a service center. They expect a truly digital government.
In turn, to become truly digital will necessitate security of critical infrastructure, business process and digital services which will be the responsibility of government, but ultimately of the systems integrators providing managed security services. Let's face it, technology is global, the threats are global, the opportunities are global.
As a result, pure-play federal businesses will be at a disadvantage. Global systems integrators like NTT DATA are more in tune technologically to deliver on the promise of technology transformation built on a secure foundation the citizens will expect of government in the future.
This story was originally published on March 1, 2017.