Paul N. Saleh joined Falls Church-based Computer Sciences Corp. as part of a team meant to turn around the company, which lost billions last year and is under a Securities and Exchange Commission investigation related to its accounting.
The chief financial officer is a veteran of well-known companies. He came to CSC earlier this year from Gannett, and had previous stints as CFO at Walt Disney International and Sprint Nextel.
As part of the changes directed by Mike Lawrie, CSC’s new chief executive and president, the company plans to cut $1 billion in expenses over 18 months.
Capital Business sat down with Saleh last week. Below are excerpts of the interview.
Are you finding connections between CSC and work you did in the past?
Each company I’ve been part of had some level of transformation. When I was at the Walt Disney Co., for example, there was a major transformation that took place there that was much more directed at exploiting a market opportunity. I was involved in the international businesses, and they didn’t have a consistent implementation of the brand. Gannett, my last experience, was a company in transformation just because the market was changing. Readership patterns, viewership patterns and the digital growth were all factors that led the company to really having to reassess where it needed to invest its assets and how it would really compete.
At CSC, the most visible change is the $1 billion in cuts.
When you look at CSC, the financial performance did not really reflect the position the company had. When you looked at it a little bit closer, you realized that the company, because of the way it was organized, it was much more fragmented. You say, ‘Well, why are we performing at a certain level?” and we look at our peers and their profitability and we say there’s a gap there. It leads you very quickly to examine your cost structure. [CSC’s] cost structure was no longer as efficient as it should have been.
Analysts have welcomed the changes. What about employees?
Any change is painful because you have to adjust to the new environment. However, I will say to you, by and large, the people down in the organization actually are the ones who were waiting so much for these changes because they realized that they were not optimal.
Can you transform with the SEC investigation still hanging over you?
The SEC investigation will take its course, but you have to deal with the environment you’re given. There’s a lot of attention on improving the controls throughout the company and addressing some of the issues that surfaced during this whole process. Everybody would like to have these things resolved, but you don't really stop, you just concurrently address all the other things that need to change.
Lawrie has said you can’t cut your way to prosperity. Have you figured out the growth piece?
We’re going through the first phase of fixing the basics, putting in place some of the foundational elements that would help us basically support the fast growth. It’s not like we’re waiting to think of how we want to grow. We already have additional initiatives under way to standardize our offerings in a few critical [areas], one of them being in cloud, another one being in cybersecurity.