Editing American Management Systems

{{Short description|American consulting firm}}
{{Infobox company
| name = American Management Systems, Inc.
| type = Public
| traded_as = {{NASDAQ was|AMSY}}
| location = [[Fairfax, Virginia]], U.S.
| logo = File:American Management Systems wordmark.svg
| fate = Sold, defense related business to [[CACI]], rest of the company to [[CGI Group]]
| foundation = 1970
| defunct = 2004
}}
'''American Management Systems, Inc.''', was a high-technology and [[management consulting]] firm, founded in 1970 by a group of five former [[United States Department of Defense|Defense Department]] officials who had worked under [[Robert McNamara]] in the [[John F. Kennedy|Kennedy]] and [[Lyndon Baines Johnson|Johnson]] administration. The company grew throughout the 1980s and 1990s, implementing key systems such as the accounting system for [[New York City]] and [[The Standard Procurement System]] for the [[United States Department of Defense]]. The company was acquired by Canada's [[CGI Group]] in 2004, with AMS's federal defense business being acquired by [[CACI]].

==History==
AMS was founded in 1970 by five former Defense Department "Whiz Kids": [[Charles Rossotti]], [[Ivan Selin]], Frank Nicolai, Patrick W. Gross, and Jan Lodal. The company's initial headquarters were in the Washington, D.C. suburb of [[Arlington, Virginia]]. The founders drew upon research in [[attribute-value system]]s and early [[relational databases]] developed by Pentagon colleague [[Hugh Everett III]], who served as a non-administrative vice president and minority partner in the firm for a time.<ref>{{cite book |url=https://books.google.com/books?id=dqgqPjqIyJoC&q=vice%20president |title = The Many Worlds of Hugh Everett III: Multiple Universes, Mutual Assured Destruction, and the Meltdown of a Nuclear Family| isbn=978-0-19-165522-7 | last1=Byrne | first1=Peter | date=13 December 2012 }}</ref> From its inception, much of AMS's revenue was derived from contracts with federal agencies. The company grew quickly during the 1970s. During its first decade of operation, AMS focused its business on consulting and selling customized software to large government and corporate organizations.<ref name="fu">{{cite web |url=http://www.fundinguniverse.com/company-histories/American-Management-Systems-Inc-Company-History.html |title=American Management Systems, Inc. |work=FundingUniverse |accessdate=2011-04-04}}</ref>

The company grew to over nine thousand employees, with many offices in both the United States and other countries. At one point in the 1990s, one quarter of the company's revenue, albeit none of the profit, came from Europe.  Much of its business centered on creating large computer systems for various government entities. It created a large accounting system for New York City during the city's recovery from its [[History of New York City (1946-1977)|fiscal crisis]] in the late 1970s, and won an award for the Defense Department's [[The Standard Procurement System|Standard Procurement System]] in 1997.<ref name="sps">{{cite web
|url=http://www.defenselink.mil/contracts/contract.aspx?contractid=1004
|title=DefenseLink: Contracts for Monday, April 7, 1997
|date=1997-04-07
|accessdate=2008-03-07
| archiveurl= https://web.archive.org/web/20080318145916/http://www.defenselink.mil/contracts/contract.aspx?contractid=1004| archivedate= 18 March 2008 | url-status= live}}</ref>

In April 1993, AMS established an applied research lab called the AMS Center for Advanced Technologies (AMSCAT) at their headquarters facility in [[Fairfax, Virginia]].<ref>{{Cite journal|date=May 3, 1993|title=Tire-Kicking Technology|journal=Computerworld|volume=27| issue =  18|pages=29}}</ref> Dr. Jerrold M. Grochow was appointed as the director of AMSCAT.

=== Telecom Practice ===
In the late 1990s and early 2000s, American Management Systems was among the main telecom consulting companies in the United States. The company grew aggressively because of professional talent in the emerging Competitive Local Exchange Companies. As a result, AMS was a market leader to offer its telecom client Kenan's Arbor-B/P, the award-winning convergence Billing Solution.

=== AMS in Europe ===
[[File:Former_AMS_building_Dusseldorf_am_Seestern_in_2010.jpg|thumb|former AMS offices, built near [[D2 Mannesmann|D2]] in [[Düsseldorf]], in 2010]]
At the beginning of the 1990s, AMS provided the PRISM billing solution for the American [[cellular network]] operator [[PacTel Cellular]], who later became [[AirTouch]]. Following the expansion of the [[GSM]] standard in Europe, [[AirTouch International]] invested in a number of foreign GSM providers. This led to the expansion of the AMS billing solution, re-branded as Spectrum 2000, into Europe. In 1992 AMS was in a unique position as provider of the billing system to the emerging mobile [[Telephone company|telco]] market in Europe, making AMS a major player in the European Market. AMS expanded into [[Portugal]], the [[United Kingdom|UK]], [[Germany]], the [[Netherlands]], [[Belgium]], [[Spain]], [[Switzerland]], and [[Poland]]. Despite this success, the company did not develop sufficient service delivery and business development units. Instead, it decided to commit to a huge (over 100M$) investment in the development of the sophisticated Customer Care and Billing System Tapestry for [[Germany|German]] fixed-wire telecom [[Arcor (telecommunications)|Arcor]]. Lack of commitment to marketing of this system contributed to the problems that led to significant [[layoffs]] in Europe in 2002. Furthermore AMS lost prestige when [[D2 Mannesmann|D2]] chose [[Amdocs]] for its billing solution.

By 2002, AMS had approximately 6300 employees, 986 million in revenue and 21 million in income and 51 offices worldwide.{{Citation needed|date=April 2016}}

=== Lawsuits, divestiture, and sale ===
In 1999, the state government of [[Mississippi]] terminated an $11.2 million contract with AMS to modernize the state's tax system and sued the company for $985 million in damages.<ref name="nyt-ms-suit">{{cite news |url=https://www.nytimes.com/1999/05/04/business/mississippi-sues-consulting-firm.html |title=Mississippi sues consulting firm |work=[[The New York Times]] |date=1999-05-04}}</ref> A jury awarded the state $474.5 million in actual and punitive damages in August 2000, causing a drop in stock price from 44 3/8 to 14. The company subsequently settled the suit for $185 million.<ref name="cnet-ms">{{cite web |url=http://news.cnet.com/American-Management-Systems-gains-on-settlement-news/2100-12_3-266618.html |title=American Management Systems gains on settlement news |date=2000-08-29 |last=Barrett |first=Larry |work=[[CNet]] |accessdate=2011-04-04}}</ref>

Another customer, the Federal Thrift Investment Board, cancelled a contract in 2000 for a system to make Thrift Savings Plan data available online. The subsequent lawsuit was settled for $5 million in June 2003.<ref name="ge-tsp">{{cite web |url=http://www.govexec.com/dailyfed/0704/070804a1.htm |title=Investigation spreads blame for mishandled TSP contract |work=GovExec.com |date=2004-07-08 |last=Gruber |first=Amelia |accessdate=2011-04-04}}</ref> A subsequent [[United States Senate]] investigation authored by senators [[Susan Collins]] and [[Joe Lieberman]] identified various reasons for four years of delays and cost overruns, including lack of formal agreement on a detailed design and problems with the structure of the contract.<ref name="wapo-tsp">{{cite news |url=https://www.washingtonpost.com/wp-dyn/articles/A35566-2004Jul7.html |title=TSP Wasted Millions in Computer System Debacle, senators say |newspaper=[[The Washington Post]] |last=Barr |first=Stephen |date=2004-07-07 |page=B02}}</ref>

In December 2002, AMS sold its Global Energy Group to Bangalore, India-based [[Wipro Technologies]].{{Citation needed|date=August 2020}}

New CEO Alfred T. Mockett was hired by AMS in 2001 to grow the company's sales from $1.1 billion to $3 billion a year, with a goal of becoming a top tier system integrator through growth and acquisitions, with an eventual goal of a "big bang merger of equals." When this strategy proved unsuccessful, Mockett negotiated a sale of the firm. [[CGI Group|CGI]], a Canadian company, was the primary purchaser, paying $858 million for the commercial business and all government business not related to national defense. The defense portion of AMS could not be sold to a foreign-based company so [[CACI]] purchased the defense and intelligence practice for $415 million.<ref name="wapo-mockett">{{cite news |url=https://www.washingtonpost.com/wp-dyn/content/article/2004/03/22/AR2005040206273.html |last=Reddy |first=Anitha |page=E01 |title=As AMS CEO Exits, Reflections of What Might Have Been |newspaper=The Washington Post |date=2004-03-22}}</ref> The sale to CGI and CACI was announced in March 2004.<ref name="wash">{{cite journal |url=https://www.bizjournals.com/washington/stories/2004/03/08/daily24.html |title=CGI, CACI buying American Management Systems |last=Hughlett |first=Roger |date=March 10, 2004 |journal=[[Washington Business Journal]] |accessdate=June 25, 2018}}</ref> The AMS brand was retained by CGI for a time and the AMS website directed users to the CGI site. CGI's United States headquarters are in [[Fairfax, Virginia]].

==Location==
For the first 20 or more years of its existence, the company was based in [[Arlington, Virginia]] on the banks of the [[Potomac River]] with a commanding view of Washington DC. In the early 1990s, AMS moved its corporate headquarters to [[Fairfax, Virginia]].{{Citation needed|date=August 2020}}

==List of chief executive officers of AMS==

* Ivan Selin - 1970 to late 1980s
* Charles O. Rossotti - Late 1980s to Mid 1990s
* Paul Brands - Mid 1990s to October 25, 2000
* Bill Purdy (Interim) - October 26, 2000 to November 30, 2001
* Alfred T. Mockett - December 1, 2001 to 2004

== References ==
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[[Category:Computer companies established in 1970]]
[[Category:Computer companies disestablished in 2004]]
[[Category:Consulting firms established in 1970]]
[[Category:Defunct computer companies of the United States]]
[[Category:Defunct computer hardware companies]]
[[Category:Companies based in Fairfax, Virginia]]
[[Category:Defunct companies based in Virginia]]
[[Category:1970 establishments in Virginia]]
[[Category:2004 disestablishments in Virginia]]
[[Category:2004 mergers and acquisitions]]
[[Category:American companies established in 1970]]
[[Category:American companies disestablished in 2004]]