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A conversation with ATS Chairman Bersoff

By Marjorie Censer
Monday, January 17, 2011; 10

Edward H. Bersoff at the end of last year stepped down as chief executive of McLean-based information technology contractor ATS Corp., though he remains the company's chairman.

The new chief executive, Sidney E. Fuchs, didn't stay long, opting to leave the company after ATS announced it would pursue strategic alternatives, including a potential sale.

Bersoff, who founded a special-purpose acquisition company to buy ATS in 2007, had previously established IT firm BTG in 1982.

Capital Business recently interviewed Bersoff. What follows are edited excerpts from that conversation:

Why did you decide it was time to step down as chief executive?

The plan from the very beginning was to not have me be in day-to-day leadership, but rather more as the chairman of the board. It took a while to get to the point where we felt comfortable changing over.

If the company is doing well, why do its investors want out?

[The special-purpose acquisition company construct] by its very nature attracted hedge fund investors. . . . Being in the company for four years, some of them, is much longer than their typical investment horizon, so as time went on and as it took us more and more time to build a business that was viable and poised for growth and a good future, their horizon in terms of patience started wearing thin. . . . The objective is to provide liquidity for our investors.

How dire do you think proposed budget cuts are for the contracting industry?

The industry is not a monolith. . . . If my company was focused on building equipment for wartime activity, I might be a little bit more worried. . . . Unlike what most people think, the businesses in this community don't like war. It's not that we're against war or [are] anti-war protesters, but . . . we don't build tanks and bombs in Washington, we build infrastructure and support services. Sure, we help the government manage the purchase of tanks and bombs, but at the end of the day we'd prefer to be selling them IT.

But the government is even giving IT systems more scrutiny.

The government forever . . . has had a difficult time in buying information technology, because the problem with IT requirements is that it takes a while to build an IT system. . . . By the time [contractors] get done, [the government's] needs have changed, [which] causes a cycle of disconcerting relationships and unmet expectations. . . . But, at the end of the day . . . they have to have the government running, so the need will always be there.

Federal Chief Information Officer Vivek Kundra is calling for a more incremental approach to building IT. Would that be better?

It's not a new concept . . . but it's hard for the government to do. What they like to do is say, "I want this, you have a year to build it, come back with it when you're done."

Don't contractors prefer to have a big contract too?

Some do, but I would argue that the most thoughtful ones don't. . . . It depends on what you want. Do you want the big hit now? [Do you] want a $10 million contract to do X or do you want a $1 million contract now to do a piece of X, do a good job and be there for 20 years getting $20 million over time? I think it's short-sighted for contractors to look to the big hit because more often than not they're going to find themselves not successful.

What will make this approach stick?

The government has to have the intestinal fortitude to do it the right way . . . and the contractors have to behave in an adult way, in a conscientious and appropriate way.

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