Keeping secrets of defense

The little-known company designs combat systems and looks for terrorists.
SAN DIEGO (AP) -- The signature understatement is vintage J. Robert Beyster as he mounts the podium for his annual address on a company whose low profile belies its enormous role in national security.
No fanfare. No crowd-pleasing jokes.
"We generally responded pretty nicely to changes in the business climate," the 78-year-old nuclear physicist tells his employees in a gravelly monotone.
Beyster's company, Science Applications International Corp. may be the most influential company most people have never heard of.
The federal government, its main customer, often doesn't want the public to know what SAIC is doing, and, as one of the nation's largest employee-owned companies, it escapes investor scrutiny.
Beyster and his top lieutenants are accustomed to keeping low profiles -- and keeping secrets. They include the Pentagon's former chief intelligence officer; a lead architect of the Star Wars missile defense program in the 1980s; the retired general who led the U.S. operation in Somalia in 1993, to name a few.
Advanced technology
With 40,000 employees worldwide, San Diego-based SAIC is enmeshed in some of the government's most sensitive work, from redesigning Army combat systems to bioweapons defense and improving electronic snooping for the ultra-secretive National Security Agency.
Though SAIC lacks the name recognition of Lockheed Martin or Raytheon, its research prowess and Washington insider connections have landed it some of the most prized government contracts.
SAIC-developed software employed by U.S. intelligence-gatherers scans newspapers, books, magazines and other documents in every major language for clues for terrorist attacks.
Other technology designed by SAIC tells soldiers where they are on the battlefield in relation to ground and air forces. Its 1,500 researchers at the National Cancer Institute in Frederick, Md., are trying to cure diseases and develop vaccines against bioterror.
The company's work is so varied and complex that workers, about 5,000 of whom have federal security clearances, struggle to describe what SAIC does, other than to say it tries to solve the world's most vexing and menacing security threats.
The good and the bad
Beyster started SAIC in 1969 with a handful of employees, feeling stifled as a researcher in Gulf Oil's nuclear accelerator lab.
SAIC has since posted 34 straight years of profits, and grew revenue by 2.3 percent to $5.9 billion its fiscal year that ended Jan. 31. It played the Internet boom brilliantly by buying Network Solutions Inc., a keeper of Web domains, for $4.5 million in 1995 and selling it for $3.1 billion four years later just before the bubble burst.
SAIC has had some setbacks: a soured contract with Venezuela's monopoly oil company, heavy exposure to telecommunications and mixed results winning technology contracts outside the U.S. government.
At SAIC's annual shareholder meeting this month, Beyster, SAIC's largest holder with a 1.3 percent stake, reaffirmed plans to step down as chief executive and said the search for a successor is going smoothly.
Still, some analysts question whether he is really serious about slowing down and whether top prospects might shy away from applying, fearing a power struggle with him.
"They've had several people come in as senior vice presidents and heir apparents, but they never got anointed," said Daniel Goure, a former SAIC employee who is now vice president of the Lexington Institute, a public policy group in Arlington, Va. "All those people have left because Beyster didn't want to let go. It's his baby."