Businessmodel of Booz Allen Hamilton

Customer Segments

Booz Allen Hamilton provides a broad range of management and technology, consulting, and engineering services to institutional and corporate clients. The Company’s clients can be organized into three principal categories:

• Government Bodies, including local, state, and federal government agencies in the US, as well as various international government bodies;
• Corporations, primarily companies operating in the financial services, healthcare and life sciences, energy, high-tech manufacturing, retail, and automotive industries; and
• Non-Profits, including various non-profit and charitable organisations across the world. Over the past year, the majority of Booz Allen Hamilton’s revenue was derived from contracts where the end client was an agency or department of the US Government. The Company supports critical missions for a diverse base of federal government clients, including nearly all of the US Government’s cabinet-level departments, and federal contract vehicles. In the fiscal year 2016, the Company’s largest client was the US Army, which accounted for approximately 15% of the Company’s revenue. The Company also counts the US Navy, US Air Force, Federal Bureau of Investigations, National Security Agency, and the Department of Energy among its longstanding clients.

The US continues to be Booz Allen Hamilton’s principal market. The Company’s international clients are primarily based in the Middle East, with the Company also serving a growing presence in Southeast Asia.

Value Propositions

Booz Allen Hamilton provides value to its clients in the following ways:

• Its reputation and industry standing, with the Company established as one of the largest and most well-regarded providers of management and technology, consulting, and engineering services, as is demonstrated by its ability to attract significant business from numerous US Government agencies, including several branches of the US military;
• Its broad portfolio of products and services, with the Company providing a broad portfolio of management and technology, consulting, and engineering services to institutional, commercial, and non-profit clients, including cyber security, IT strategy, and systems delivery solutions;
• Its personalised service delivery, with the Company working closely with its clients over an extended period of time, providing services and solutions that are tailored to the individual needs of each client;
• Its international reach, with the Company serving an international client base across the Middle East and Southeast Asia, in addition to its extensive domestic client base in the US. ### Channels

Booz Allen Hamilton operates a website at www.boozallen.com, through which it provides information on its various services, solutions, locations, and target industries. The nature of the Company’s tailored consulting services does not lend itself to the operation of an online sales, self-service sales channel. The Company also does not operate an online customer portal.

Booz Allen Hamilton makes sales and provides its various services through its dedicated consulting and service personnel, who are organised principally by service line, with separate units covering the Company’s management consulting, technology, engineering, strategic innovation, and product-related services. These employees operate primarily out of the Company’s international network of offices, including numerous locations across 32 US states – and Washington DC – as well as in the United Arab Emirates, Saudi Arabia, Egypt, South Korea, Russia, Indonesia, and Singapore.

Booz Allen Hamilton also operates a number of so-called Sensitive Compartmented Information Facilities, which are enclosed areas within buildings that are used to perform classified work for the US Intelligence Community. A number of the Company’s employees also operate out of facilities provided by the US Government.

Customer Relationships

Booz Allen Hamilton does not provide services to its customers on a self-service basis, nor does it provide an online customer portal through which customers can independently manage their services.

Booz Allen Hamilton provides tailored services to its institutional, commercial, and non-profit clients. The Company’s consultants work closely with clients on an ongoing basis, seeking to deliver personalised services and solutions, and establish longstanding business relationships. Booz Allen Hamilton has already established long-running relationships with a number of government agencies, including relationships spanning more than 65 years with the US Army and the US Navy.

Booz Allen Hamilton provides ongoing support to its clients, operating dedicated client management units. Clients can also contact members of the Company’s consulting and support personnel at the relevant office, or can make more general enquiries over the phone or via an online contact form.

Additionally, Booz Allen Hamilton provides a range of online resources to its clients, notably its various industry and market insights, white papers, videos, podcasts, and studies. Clients are also able to interact with the Company, and follow its corporate developments and activities, through its social media accounts including with Facebook, Twitter, and LinkedIn.

Key Activities

Booz Allen Hamilton is an international provider of management and technology, consulting and engineering services. It operates through a single business segment, providing tailored solutions and consulting services – including systems delivery, engineering and science, cyber, analytics, and consulting – to the US and international governments, commercial entities, and non-profit organisations. Much of the Company’s business relates to its range of services provided to US Government agencies, including the Federal Bureau of Investigations, the US Army, the US Navy, the National Security Agency, and the Department of Homeland Security.

The Company’s commercial clients in the US operate primarily in the financial services, healthcare and life sciences, energy, high-technology manufacturing, retail, and automotive industries. While the bulk of the Company’s business is conducted in the US, Booz Allen Hamilton also serves clients across the Middle East and Southeast Asia.

Key Partners

Booz Allen Hamilton works closely with a range of companies and organisations that assist the Company in providing high-quality services and solutions. These partners can be categorised broadly as:

• Supplier and Vendor Partners, comprising suppliers of services, tools, technologies, and equipment that are utilised across the enterprise or within certain of its departments, as well as companies to which no-technical functions can be outsourced;
• Strategic and Alliance Partners, comprising various market-leading companies across multiple sectors, with which the Company shares resources and collaborates on joint projects;
• Technology Partners, comprising technology, IT services, and systems integration companies that provide technology and It maintenance and security services to the Company;
• Educational and Academic Partners, comprising various education and academic institutions, with which the Company collaborates on management and business programs, and offers opportunities to top graduates; and
• Community and Social Partners, comprising a number of non-profits and charitable organisations with which the Company collaborates on social and community projects around the world. Booz Allen Hamilton has partnerships in place with a number of high-profile names. This includes a technology partnership with Amazon Web Services concerning opportunities related to the internet-of-things, a tie-up with Microsoft to provide surface tablets to hospitals, and an education partnership with Excelsior College.

Key Resources

Booz Allen Hamilton’s key resources are its intellectual properties, its relationships with the US Government, its IT and communications infrastructure – including its cyber security systems, its sales and service network, its partnerships, and its personnel.

Booz Allen Hamilton owns a range of intellectual properties and proprietary information, which are protected by trademark and trade secret laws. The Company also owns a number of patents, although it does not consider its business to be materially dependent on the protection of these patents. Searches of records published by the US Patent and Trademark Office identified several patent applications filed in Booz Allen Hamilton’s name, including applications entitled ‘Mobile pothole detection system and method’, ‘Vehicle identification system and method’ and ‘Systems and method for identifying and mitigating information security risks’.

Booz Allen Hamilton also leases a number of physical properties across the US and abroad, principally relating to its various corporate and administrative offices.

Cost Structure

Booz Allen Hamilton incurs cost in relation to the development of its solutions, the maintenance of its IT and communications infrastructure, the operation of its sales and service network, the management of its partnerships, the procurement of professional services, and the retention of its personnel.

In fiscal year 2016 Booz Allen Hamilton recorded total operating costs and expenses in the amount of $4.96 billion. This included cost of revenue totalling $2.58 billion, and general and administrative expenses – including expenses related to corporate administrative functions, marketing and bid and proposal costs – totalling $806.51 million.

Revenue Streams

Booz Allen Hamilton generates revenue derived from the provision of various management and technology, consulting, and engineering services under contract to institutional and corporate clients, including cyber security, IT strategy, systems delivery, and strategic communications solutions.

In 2016 Booz Allen Hamilton generated annual revenue of $5.41 billion, up marginally on the $5.27 billion recorded by the Company in 2015. The Company attributed this small increase to a general increase in client demand.