2014 Market Outlook: Harris IT Services President Wayne Lucernoni Predicts M&A Activity Increase Amidst Tough Competition and Pressure on Price

Wayne Lucernoni, Harris Corporation

Wayne Lucernoni, Harris IT Services

WashingtonExec 2014 Market Outlook Series

As we turn the page on 2013, we look forward to a new year and new opportunities for innovation and growth in the government contracting community. This past year we experienced budget sequestration, a 16-day-long government shutdown, and a perpetually increasing focus on cyber security and healthcare IT.

WashingtonExec reached out to those most knowledgeable and experienced individuals in the federal contracting space. We asked executives in and around the beltway for insight regarding where they see the government contracting community headed in 2014. Topics discussed include M&A activity, cloud computing, healthcare IT, defense, mobility, and more.

Wayne Lucernoni is the President of Harris IT Services, a leader in the design, deployment, operation and maintenance of highly reliable, secure integrated network solutions:

I expect 2014 to be marked by tough competition and a lot of pressure on price, just like 2013. The pressure on government budgets will continue. Most of the industry has cut costs to the bone and has settled into this new situation, so it won’t be jarring, like it was in 2013, but it is still something we have to deal with.

I definitely expect more M&A activity. That has been a constant in our industry, but it is bound to pick up a bit because companies will try to acquire competencies and experience that fit the areas where government is growing, the services they think the government will need in the next five to ten years. The obvious ones are cyber and healthcare IT, but there are others. Small and medium-sized companies that have expertise in growth areas—and especially those that have established relationships and contract vehicles—will definitely be attractive acquisition targets.

Government and industry have always worked well to meet new technological challenges, and we’ve been working on all of the ones you’ve mentioned for some time now. There are strong relationships between government and industry in all of those areas. Government agencies know pretty well what they need, what they can do for themselves, and what they need industry to do for them. They also are very sensitive to the role industry can play to meet surge requirements or handle sudden or unanticipated needs.



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