Technology Business Research, Inc.Federal IT: AI Adoption, Defense Spending and Projections for the Next 5 Years
Episode highlights:
- The five-year outlook for federal IT
- The link between IT services and defense and intelligence businesses
- The expected impact of AI over the next five years
“There’s going to be a lot more emphasis on outcome-based contracting, you know, refocusing on IT modernization, but very constrained. It’s not going to be kind of the free-for-all that it was. There’s still a lot of investment that needs to happen. So, taking all that into account and taking into account the simple fact that there is still a lot of modernization work that needs to be done across the board, that’s kind of the foundation for our five-year outlook,” said Caucis.
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Federal IT: AI Adoption, Defense Spending and Projections for the Next 5 Years
TBR Talks Host Patrick Heffernan: Welcome to TBR Talks: Decoding Strategies and Ecosystems of the Globe’s Top Tech Firms. Where we talk business model disruption in the broad technology ecosystem from management consultancies to systems integrators, hyperscalers to independent software vendors, telecom operators to network and infrastructure vendors, and chip manufacturers to value-added resellers. We’ll be answering some of the key intelligence questions we’ve heard from executives and business unit leaders among the leading professional IT services and telecom vendors.
I’m Patrick Heffernan, Principal Analyst, and today we’ll be talking about TBR’s brand new Federal IT Services Market Forecast with John Caucis, Senior Analyst for TBR’s Federal IT Services Practice, and James Wichert, Senior Analyst for TBR’s Federal IT Services Practice.
Starting point for the Federal IT Services Market Forecast
John and James, welcome back to TBR Talks. Really glad to have you guys here because you’ve done something that we have been promising for a long time. We’ve been asked for a long time to do this, and we finally have rolled out Market Forecasts in the IT services space. Always been a challenge. It’s something I’m really happy that we’re finally doing. And John and James, you guys rolled out the first one for the practice, specifically around the U.S. federal government’s IT services space. So, John, you want to tell us a little bit about the forecast?
John Caucis, TBR Senior Analyst: Yeah, it comes at a really interesting time a year after the Trump administration completely upended the market, the Department of Government Efficiencies and then the shutdown at the end of federal fiscal ’25, which further disrupted the overall space. We saw the markets actually expand slightly during fiscal ’25, which wrapped up on September 30th of last year, but mostly because it drafted off of the four-year, five-year bull market that preceded it. So, we took that into account as we were putting together our forecast. We took into account the comments and the interactions that we’ve had with the leading federal systems integrators, Leidos, CACI, Booz Allen, et cetera. And we certainly took into account what we have seen, what we have observed in terms of federal spending priorities, what we saw remaining in place during the Trump administration. It’s going to be AI and defense and national security and intelligence spending in a nutshell. But we put all that together, and we wanted to put together a product, a forward-looking product that really gave the audience, the reader, the perspective from the, you know, through the lens of the vendors that we track. So within that, you will see not only our projections and our analysis around the overall market, where we think the market is headed over the next year, two years, five years, but where the vendors themselves are headed and what are going to be their priorities and how we see them performing over the next five years. And just to kind of put a bow on the quantitative aspects, as I mentioned at the outset, we saw the market expand slightly in 2025, fiscal ’25. That is not going to be the case in ’26. We’re looking at a market contracting anywhere from 3-5%. Buoyed by the defense space and spending in the intelligence markets, but the civil market is going to remain really, really tough during the year. So that will be business as usual in fiscal ’26.
Five-year outlook
Patrick: I want to come back to the assumptions and I want to talk specifically about some of the companies that you’re covering here and the projections that you’re making. But looking out beyond 2026, what’s the five-year picture that you guys came up with?
John: The market will rebound. It’s going to take some time. The defense and intel and spending on national security as not just in the defense and intel spaces, but also civil should remain fairly robust. The Trump administration established that as a priority right up front. Conversely, though, the bull market in civil IT spending, I mean, we were observing double-digit civil growth for three, four, almost five years up until fiscal ’25. That’s over. The party is over in the civil space. That’s where the bulk of the elevated scrutiny on consulting work on behalf of DOGE, the Department of Government Efficiencies, that’s where the bulk of that happened. There’s going to be a lot more emphasis on outcome-based contracting, refocusing on IT modernization, but very constrained. It’s not going to be kind of the free for all that it was. There’s still a lot of investment that needs to happen. So, taking all that into account and taking into account the simple fact that there is still a lot of modernization work that needs to be done across the board, that’s kind of the foundation for our five-year outlook. So, we see the market struggling in ’26 overall with more opportunity on the defense and intel side, obviously, but the civil market should start to pick up again. At least that’s the sense that we’re getting from our observations of the vendors, that by fiscal ’27, certainly by fiscal ’28, the next election year, things should have stabilized in the civil space. And then we see a more moderate pace of expansion, low single digit rates through fiscal ’30.
Market leaders will be taking more market share
Patrick: So, let’s talk then about the companies. And when you talk about that projection next year and then the changes for the next five years, are there, and James, I don’t know whether you want to take the companies you think are going to do well first or the companies you think might struggle first, but who do you look at and say, this is going to be the most challenged in this current environment? And then who do you think is probably best positioned to actually take advantage of what you project is going to happen in the federal IT services space?
John: I’ll start with who I see as leading, who we see as performing the best. And right up front, it’s CACI. In fact, they are projecting for their fiscal ’26, which wraps up on June 30th; they’re projecting still between 8 and 9% growth.
Patrick: Okay.
John: And that’s with a civil business that comprises about 20% of their revenue base. So, they’re still looking at growth this year. They’re still looking at growth over the next two or three years. It will slow down. But with 80% of their business coming from the defense and intel spaces, a large proportion of that from the classified space, from the fact that the bulk of their civil business is in national security, border security, AI-related enablement, they’re going to do well in that respect. So, we see them as being the five-year growth leader. I think we were projecting that their five-year growth, compounded annual growth would be somewhere in the mid-single digit range. So, we see them as being the growth leader.
The other leader, just from the perspective of market share and the size of their revenue base, today it’s Leidos. In five years, it’ll be Leidos. They also have, with a slightly different portfolio, but they also have a very robust defense and intelligence operations. They’re one of the leading vendors that’s going to be participating in the Golden Dome project, the missile defense shield. And they are more exposed to the contraction in the civil space, but they also have a fairly robust health IT business, which slowed down. But, and I think James might talk about this one, when it comes to companies like Maximus, there’s still a lot of activity there, a lot of modernization work. And I think that Leidos will be able to benefit from that. So, we see them not only, and CACI actually, not only retaining their market share that they have today, but actually expanding it a bit.
And I think that suggests also another trend that we’re observing that the companies at the top of the market, the leading federal systems integrators, they’re actually going to be taking, we believe, they’re going to be taking market share from the smaller companies. We’ve seen what’s happened in terms of the 8(a) companies, they’re really under heavy scrutiny right now. A lot of them have gone under over the last year. And we see that coming. We see the top of the market. That being one of the reasons why the top of the market is going to be capturing share from the bottom of the market.
Patrick: Right. And so, I mean, that kind of consolidation is- it seems like it comes and goes in waves. And then, so 10 years from now, we’ll be talking about all the new players that have come in and taken market share. But for the next five years, you’re anticipating that the leaders are going to capture more of the total pie. Yeah. So, all right, James.
James Wichert, TBR Senior Analyst: I mean, just dovetailing on that, I think it’s also worth including General Dynamics Technologies in this conversation. Historically, there’s been little synergy at the top line level between the information technology and the mission system segments under the GDT banner. 3.4% of revenue growth is the largest calendar year improvement we’ve seen from them. And General Dynamics’ leadership team are forecasting fiscal year 2026 sales growing approximately 2.5% over 2025 sales of $13.5 billion. But we feel that GDT is well positioned through 2030 and could expand at a CAGR a little north of 3%. Now, obviously, GDT has a scale advantage over almost all the companies we track, given their annual revenue and General Dynamics’ financial backing.
Patrick: Right.
James: They’re just to better withstand these types of storms that we’ve been seeing in the federal space of late. And like John said, one trend we really noticed when putting together this forecast was that the bigger players were those set up best to expand their market share over the next few years. While they may not be as nimble as their smaller peers who can, at least in theory, more rapidly adjust to sudden changes, GDT certainly has the scale, the expertise, and portfolio necessary to face these challenges head on. And take some short-term disruptions, but thrive in the long-term. You know, DOGE and the government shutdown did negatively impact GDT, but it didn’t cripple them as much as a smaller player like, say, an ICF. Both GDIT and Mission Systems are already well aligned with the Trump administration’s priorities in the defense market. GDIT’s investments in AI, cybersecurity, and other growth areas, they’ve proven fruitful as evidenced by the growing demand for their digital accelerators.
The link between IT services and defense and intelligence businesses
Patrick: So how much is having a strong defense presence going to be critical to having an outperforming IT services company performance in the, an outperforming performance, in the civilian sector? I mean, is it a prerequisite that a CACI or a Leidos or a GDIT has that strong presence and success in the defense space in order to, or is it just- and I’m asking because I’m thinking about companies traditionally, if you’re particularly good in one area, like to go back to like Booz Allen Hamilton is a great example. You guys haven’t mentioned them, but in the federal space, certainly an important player, but they had to split Booz and Company and Booz Allen Hamilton because the two pieces of the business were not operating at the same, with the same kind of success and a whole lot of money. Anyway, it’s a long story there. But the bottom line is when I think about, okay, Leidos has this great defense business and a healthcare business, but here they are doing, how are they going to do in IT services? Is doing well in IT services predicated on having that backstop of a defense and intelligence business?
James: I don’t think it’s a prerequisite technically, but it is extremely helpful. So, looking at another company that, you know, I was just talking about, you know, like the big getting bigger, and I do think that’s true overall, but there is a substantial bull case scenario for Maximus over the next five years. And, you know, they are smaller. They’re heavily entrenched in the federal civilian market. They’ve been largely shielded from DOGE and the government shutdown related disruptions due to the essential nature of their work. And their recent really rapid expansion has been driven by the demand for medical disability examination services. They’re working on the contact center operations contract, parlaying that into IT modernization work. And so that’s all federal civilian, but then very recently, they’ve been successfully making inroads in the defense market.
Like, after years of very minimal wins, all of a sudden they notched two IT contracts, the US Air Force. They’re worth more than $160 million. They recently achieved level 2 cybersecurity maturity model certification. And, you know, they’re showing they’re serious about competing in the defense market. I don’t think it’s unrealistic at all to say they could expand at a CAGR of 4% over the next five years, something like that.
Patrick: Right. Which will exceed what you expect from GDIT. So, yeah.
John: And will exceed the overall market growth rate, which means they’re going to capture share. That’s a great point.
I think in general, the companies that we, Maximus might be the exception although it sounds like they are going to be buoyed somewhat by their defense business, which is gaining traction. But in general, the companies that grow their revenue base overall over the next five years. It’s going to be, the foundation of that is going to be in the defense, intel, and national security spaces. And that’s, as I mentioned, that’s Leidos, that’s CACI. That’s also not in the near term, but in the long term, Booz Allen. We actually see Booz Allen, despite how hard they were hit over the last year. And they’re, I’m guessing, at this point, they haven’t tendered their forecast for their fiscal ’27, which would run to March 31st of next year. I’m guessing it’s not going to be all that spectacular.
Patrick: Right.
John: They were projecting about a 10% decline. I think it’s, you know, after four or five years of double-digit growth, now their sales have turned down, but it’s all on the civil side. I see eventually Booz Allen, their defense business has remained fairly robust. That’s going to be the basis for them to not only buoy what happens, what continues to happen in the civil space, nor pullback in consulting spend, the shift to outcome-based contracting. But Booz Allen is just way too smart to continue to struggle.
Patrick: Right.
John: They’re already starting to figure things out. They were just rolling with the market for the last five years. I mean, they were well positioned to capture the type of spend that agencies in the civil space were, you know, that match with their spending patterns. That has changed quickly, radically over the last year, but Booz will adapt. And I actually see them over the next five year period, over the next five years capturing market share. You know, leaning on their advisory heritage, that is evolving as well. But in general, the companies that have a robust defense business, robust intelligence business, presence in national security in the civil side, we see them as performing the strongest over the next five years.
Patrick: Yeah, and betting against Booz would be like betting against McKinsey. It’s just foolish because, I mean, they’re too smart, they’re too well run. If consulting in particular, but IT services as well, really depend on client retention. I mean, I think Booz has done an exceptional job over the year at retaining their clients across the different agencies in the defense space.
Companies there are questions around
One more question specifically to the companies. So we don’t need to get into who you think is going to fall apart, but I am curious if there are certain companies you look at and think, and I know this is true when we look at the broader IT services space, you just think, I don’t know where they’re going. Like when I look out five years, they’re a bit of a mystery. The strategy isn’t clear. Where they’re trying to place their bets isn’t clear. Can they execute isn’t clear. That doesn’t mean they’re necessarily going to fail. You just don’t know what is really going to become of this company. Are there any like that in the federal IT services space?
James: I mean, KBR’s MTS spin-off is interesting in that sense, but I do think overall there’s still a vision there that makes sense. I think for the vendors I track, ICF is probably the one that most baffles me a little bit.
Patrick: Yeah.
James: They had this huge wave of M&A activity between like 2020 and 2022. And then they stopped that to allow their business to grow. And it was doing that. And then, their federal revenue cratered by more than 35% year over year in 4Q25. And while their revenue comparisons certainly won’t be that bad in the first half of 2026, they still won’t be pretty.
Patrick: Right.
James: Their overall headcount declined by close to 10% year to year. Most of their workforce reduction efforts, you know, that’s been more programmatic, consulting-oriented, and those are the aspects of the business that DOGE’s contract terminations hammered and the Trump administration’s moving away from funding. So, I mean, there’s still an opportunity in IT, but ICF as a whole just appointed a new company president whose background is heavily tied to the energy, environmental, and commercial part of the business. The vast majority of ICF’s recent moves have been related to grid modernization, you know, other energy-related plays. Their federal IT business will bounce back and return to growth in 2026, but there’s just more hard times coming for their overall federal business. And it doesn’t look like their management’s particularly interested in investing further in them at the moment. Barely any partnership activities, no M&A, there’s no major deal wins. It just doesn’t look great for ICF right now. I’m not entirely sure what their plan is. I don’t know if they want to look at divesting something even further into commercial to hedge their bets, but it just seems very chaotic.
Patrick: Yeah, so that’ll be interesting to come back to in the next year or two years. John, how about you? Any mystery companies out there?
John: SAIC.
Patrick: Huh.
John: Last October, they, gosh, their C-suite is- half the people that were there six months ago are no longer there. Their former CEO is gone. The chief innovation officer that she hired has departed the company. There were multiple other C-suite level and senior executive departures. They’re restructuring the business again. For the second time, in about 3 years. What that says to me is that they haven’t evolved away from the commodity IT types of services, despite making some good acquisitions over the last five years. The last acquisition was in 2021, despite really being aggressive in enhancing their alliance ecosystem, enhancing their partnerships, particularly with the hyperscalers. We saw a lot of great moves there. They introduced some fairly robust solutions in the cloud arena. Their messaging was good. Their messaging was strong. But then just almost overnight to see the upheaval that we’ve seen, and it wasn’t just caused by the market, because companies like Accenture Federal Services, IBM’s federal business, CGI, Booz Allen, I’ve mentioned already, they were hit harder.
Patrick: Right.
John: They had a much more severe impact on their top line from DOGE and the government shutdown than SAIC did. But it’s like SAIC is hitting the reset button again. And to me, that’s an indication that the previous leadership, at least those that departed, the board looked at their performance and did not see the evolution of the company happening as fast as it should have.
Patrick: Right.
John: But this is a really bad time to be resetting your strategies.
Patrick: Yeah.
John: So, I think there’s a lot of questions. If you read our report, that’s the analysis that we kind of wove around SAIC, that they are the most, the most questions really revolve around SAIC, where they’re going and how they’re going to get there, more importantly. They’re going to have to move fast. And they actually have started in one respect. They made an acquisition. of a company that enhances their portfolio in agentic AI, which is a good move. It’s not going to move the needle a whole lot in terms of revenue, but at least they have the capabilities that they can scale across the remainder of their portfolio. So that was great. If that’s an indication of what they’re going to do. Their profitability has improved, which is which is one of the goals of the new restructuring program, so they can plow those profit dollars back into the company in terms of investments, M&A and new solutions and whatnot. But there’s still a lot of questions around SAIC in my mind.
Discussing potential scenarios for the next five years
Patrick: So, I want to come back to the acquisitions and AI. But you mentioned the report. And I think one thing that we tried to do in the forecast for IT services was not just give a top line or a big number and say, okay, this is, the market’s going to grow at this amount over this number of years. We wanted to talk about what- once we’ve done that, and we can talk about how you guys came up with that number, but once we said, this is what the market is going to look like, this is what the growth projection is for the next five years, what are the things that could change that? What are the things that could be kind of the wild cards? And the pandemic was a reminder to all of us that these things can happen. And honestly, what happened with DOGE last year was another example of where can chaos come from? So maybe just highlights of a couple of the sort of the scenarios that you have in the report and how they play out.
John: We’ll start with a potential best case scenario, which would be, I think fiscal ’26 is already a foregone conclusion in the civil market. But a rebound, a sooner than expected rebound in civil spending would certainly be welcomed by, especially by folks like Booz Allen and Accenture and CGI and IBM. And there’s still a lot of modernization work that needs to happen. If the rebound in civil happens sooner than expected, if the stabilization happens, and we are actually seeing some signs of that now. I think the Trump administration recognizes that, as I mentioned, that there’s still a lot of baseline IT enhancement and enhancement of IT infrastructures that has to happen before they can start executing on their priority of implementing AI across the civil space, as well as defense and intel.
Patrick: And that’s true with- when we’re looking at on the commercial side, like every single enterprise has to go through IT modernization, data readiness. You can’t just flip the switch and turn on your AI-enabled solutions and think they’re going to work. So same is going to be true across federal government.
John: Yeah. So best case scenario, the recognition of that drives a rebound sooner than expected.
Patrick: Yeah.
John: Immediately off the top of my head, that’s what I’m thinking. I mean, another best case scenario would be that defense spending is even more robust than it’s expected to be. I think the Trump administration requested a defense, an overall defense budget north of a trillion for the first time.
Patrick: Right.
John: And we’re expecting to see that grow. Some are saying as high as $1.5 trillion by the end of the Trump administration, Trump 2.0. We’ll see if that plays out. But there’s going to be a huge IT component in that.
Patrick: Yeah.
John: So, the folks that are doing well now, because they have a footprint in defense intel and national security, they’re going to continue to do well. And that’s honestly why I see CACI being the growth leader over the next five years.
Patrick: Gets back to what you said earlier, that the bigger companies, the ones that have been successful now going into this, are simply going to gather up more market share. Any of the scenarios jumped out for you, James?
James: Well, to build off on what John was just talking about, I mean, yeah, the Trump administration has openly talked about increasing defense spending to $1.5 trillion in federal fiscal year 2027. And with the ongoing conflict in Iran, it’s yeah, it’s looking very likely that defense spending will be growing more rapidly than many of us would have expected a few months ago, which would provide additional opportunities to FSIs. Just looking at one vendor in particular, you know, GDT, they stand to benefit. Beyond mission systems, defense electronics being increasingly in demand, GDIT have been aggressive about fostering an expanded relationship with the DOD or the Department of War under Pete Hegseth and, you know, the DOD have been pushing vendors to self-organize, take on more risks during development, deliver results faster. And GDIT have certainly been showing a willingness to do that. Just a few months ago, GDIT launched a Mission Emerge Center in Springfield, Virginia, where the Pentagon and intelligence communities can closely monitor the co-development of innovative military solutions that GDIT and their partners are working on. And speaking of partners, yeah, GDIT have continued ramping up their partnership activity. Lately, their collaborations with AWS and Google, they’ve notably centered around defense needs. And I think that’s just one more scale advantage to GDT, just being able to build up new facilities and just actively collaborate with these companies.
Patrick: Right, they have the financial backing and they have the partnerships in place.
The impact of AI on the next five years
So, let’s wrap with AI, because everything always goes back to AI these days. Fair enough. And so, how did you think about the five-year federal IT services forecast in terms of what application of or adoption of AI could do both to these companies and then to sort of the overall government spending. And I’ll lay it out in the way I’ve been thinking about it, which is lots of companies are anticipating that they’re going to spend money on AI now, and they’re going to be saving money on their operations in three, four, five years, however long it takes. And they want to see that return on the investment as soon as possible. Government shouldn’t be designed around return on investment. It isn’t a business. But if you think about government spending, is the idea going to be the more AI enabled the IT environments are within an agency, the less money they’re going to be able to need in order to operate? So, you could actually see AI depressing government spending long-term, five years, maybe 10 years out. How do you see that playing? What was your thinking going into this forecast with respect to AI?
John: One of the vendors that comes to mind in this regard is Leidos, because I think that the way that they’re approaching this question is really smart. No agency is going to be able to, or be willing to, because of security concerns, because of the ethics around AI, how it’s going to disrupt the federal workforce, and other concerns as well. No agency is just going to overnight, as you kind of used your analogy earlier, flip the switch and go agency-wide with AI. They’re not going to AI enable their agency, end to end, comprehensively overnight. What Leidos is doing is, and this is also in response to the market, the shift in procurement approaches towards more outcome-based, and that’s still kind of questionable. I think it’s going to be more of a fixed price rather than, I think outcomes are, that’s a really nebulous concept.
Patrick: Yes, it is.
John: What does that mean? Whereas a fixed price, I mean, that’s on paper.
Patrick: Right.
John: That’s set in stone. So, what Leidos is doing is they’ve stepped back, and they’ve said, and they’ve got the flexibility to do this because they’ve improved their profitability far beyond what I thought was even possible over the last two years. So now they can, they’ve got that buffer to work with and they’ve said, we are willing to break up either existing contracts into smaller modules and AI enable that piece of the contract, this one particular function in an agency, this one particular department within an agency, take a piecemeal approach, show you what we can do. And even if it costs us more in the near term, in the long term, they’re setting themselves up for the downstream work, to take that AI implementation agency-wide.
That’s a slightly different approach than what I see in Accenture doing right now. Accenture, I think they’re falling back more on the messaging that I see in the global commercial space, where they’re emphasizing their ability to go enterprise-wide right from the get-go. And they certainly have the chops to do it. But I don’t think the maturity or the willingness on the part of the agencies is in place yet. And the budgets aren’t there yet either. There’s too much risk. Risk in terms of cybersecurity, risk in terms of workforce upheaval, a lot of unanswered questions. And I think that IT decision makers and agencies are- they want to see what can be done on a small scale before they commit to going larger.
Patrick: Yeah, and when you say outcomes-based is nebulous, it’s because of what you said at the end there about risk. The reason why outcomes-based contracts are so difficult for companies and their providers, IT services companies and enterprises or agencies to agree on is because who takes on the risk? If it goes badly, then a company, an IT services provider can walk away and go to the next company and try and cut their losses. But if it goes badly and an agency is stuck with an IT environment that doesn’t work, or an AI system or enabled solution that doesn’t work, then they’re the ones that took on that downside risk. So that’s a real challenge there. Any closing thoughts on AI, James?
James: I mean, what you were just talking about there, I guess you’d say that’s like a worst case scenario too for vendors. Just this environment where everyone’s taking on increased risk. I mean, Peraton’s big win with the FAA, the brand new air traffic control system contract, you know, their compensation’s being tied to performance benchmarks. So just more accountability and risk there. And if we see that bleeding elsewhere into the market in other contracts. But with AI, I mean, that’s a very interesting point on whether it would compress, spending over time. I don’t think it would in the next five years. And even in that case, I still think, you know, Neil Young famously once said, rust never sleeps. You always need to keep adapting and evolving.
Patrick: Yeah.
James: It’s like those systems always need to grow. And so. I think there’ll always be a market. It’s not like it’ll dramatically ever fall off the cliff or anything. I think it maybe expands less rapidly in say like 10 years, but yeah.
Patrick: Yeah, that’s why I’m still very bullish on the consulting market because all of this chaos just feeds the need for somebody to come in and help you figure out what to do. And AI, the shift towards agentic, or this push around, the hype around agentic right now, this idea that you can have a robot that will do things for you, and the robots never sleep, and that’s great, but then the robots eventually get bad at their jobs. Eventually they start doing things they shouldn’t do, or more importantly, they just aren’t needed anymore. And then you gotta retire them. Well, that process is not, it’s not as simple as just, oh, I’m not gonna check that e-mail account anymore. That’s not quite the way it works.
John and James reflect on what they wanted to do at age 22
All right, I want to wrap. This has been a little long, but it’s been super good. And I just want to wrap with the same question I’ve been asking everybody here in season five. This is season five of TBR Talks which is kind of amazing. So right now, as we’re recording this, my youngest child is in her last semester of college. And so, for her, the whole world is open. She can imagine all the possibilities of what she could do with her life. And so, it made me think back to, all right, when I was just graduating college, what did I want to do with my life? What was my sort of this is my- and part of this is also inspired by a conversation I had when I was in Toronto, where a woman who’s a very successful executive in an IT services company said if she could go back and do it all again, she would be an engineer for a Formula One race car team, so with that in mind, John, I’ll let you go first. James, I already know the answer. You already, when you were graduating college, all you wanted to do was come work at TBR because it wasn’t that long ago.
James: That was my dream ever since I was a child.
Patrick: There we go. But I know there’s- I know you were also a professional photographer, so we can come back to that in a minute. But John, when you were just about to graduate from college, what did you, what was your dream job, dream career?
John: Well, I thought I was going to go to law school, and I almost did. I almost did.
Patrick: Wow.
John: I applied and I got accepted. And then I decided to go to business school instead. And that was the right choice. And I think there’s still a lot of opportunity there because of how broad a business education is and how flexible it is. You’re not locked into one discipline or another. You have the focus on finance, on marketing, on accounting, global business, even IT to an extent.
Patrick: But when you were 22, were you thinking you wanted to be an attorney that was prosecuting criminals or you wanted to be like, general counsel for ExxonMobil? I mean, what was your-?
John: That was a long time ago.
Patrick: It was a long time ago.
John: I’m not going to say how long ago it was, but I actually thought about coming back and perhaps teaching.
Patrick: Okay.
John: You know, teaching like pre-law in my alma mater, but are moving into more like the constitutional law area.
Patrick: Okay.
John: Obviously, that’s not what happened. But what I’m encouraging the kids in my family now is, you know, look for a career that is not going to be disrupted by AI. And really, that’s the trades. I have three nephews, for example, who’ve already, I’ve had this conversation with, they’re not college age yet, but we’re encouraging them to either, and that could be the traditional trades or it could be college level trades, engineering, STEM, or business.
Patrick: Yeah.
John: I mean, business is essentially trade. But I think overall, I mean, I recently saw a podcast with the chief technology officer at Palantir, and he said, we got to pump the brakes on the fear, the fear mongering with AI, because there’s, and he might be overly optimistic, but I don’t think so. The disruption- there is going to be disruption, but it’s going to be more of a reset and an enabler. So maybe a traditional college degree will lead to something that we can’t even imagine at this point, an opportunity path that creates new opportunity avenues for folks.
Patrick: Right. All right, James, when you were 22, what was 22-year-old James wanting, thinking he was going to do with his life?
James: From a young age, I’ve always wanted to provide value to shareholders. That was everything I was focusing on day one.
Patrick: *laughs*
James: Yeah, when I was 22, honestly, when I was 22, I was here. So, anyway. *laughs*
Patrick: Yeah. But you took, but you had-
James: I mean, if we go earlier back, I don’t know.
Patrick: You have been paid for photography. That is-
James: Yeah.
Patrick: Yeah, you have been a professional photographer. So that was, but you didn’t imagine yourself like being a photojournalist out covering a war somewhere.
James: No.
Patrick: That wasn’t your, yeah.
James: I mean, when I was 21, I was here. But when I was younger, when I was in high school, I started a photography business. I was very big into marketing. I used to just do a lot of sports photography. So, I would go out to major league soccer matches. I worked with the US Women’s National Team. And that was very fun. I was, I mean, I still like taking photos. I still love doing that, like going out on hikes and just capturing that experience. You know, I guess I always thought it would have been cool to make something work out of that because I used to do like friends’ headshots and people’s like professional photos and stuff.
Patrick: Right.
James: And I guess like that’s what I was like looking at doing when I was going into college. And it’s like- held on to that for a while. And then, it’s all about the shareholders. It’s all about it.
Final thoughts
Patrick: *laughs* Excellent. Gentlemen, thank you so much. What we’re going to do is have you back in season six and see how the early part of the forecast held up and see how the companies you talked about are doing. Thanks for coming on.
John: Thank you.
Patrick: Tune in next week for another episode of TBR Talks.
Don’t forget to send us your key intelligence questions on business strategy, ecosystems, and management consulting through the form in the show notes below. Visit tbri.com to learn how we help tech companies, large and small, answer these questions with the research, data, and analysis that my guests bring to this conversation every week.
Once again, I’m your host, Patrick Heffernan, Principal Analyst at TBR. Thanks for joining us, and see you next week.
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