TOP 100: How Serco Inc. uses its pivot to position for Trump priorities
“One of the things that I like is that there is more much more emphasis on readiness and efficiency,” Serco Inc. CEO Tom Watson says about the Trump administration's priorities. Courtesy of Serco Inc.
By
Nick Wakeman
Company No. 30 on our 2025 Top 100 has made acquisitions and technology investments to align it with the administration’s push for greater efficiency, lethality and modernization.
As the Trump administration pushes its agenda focused on efficiency and cost savings, federal contractors are quickly adjusting strategies to align with the new administration.
Serco Inc., No. 30 on the 2025 Top 100 with $1.3 billion in prime contract obligations, sees itself as particularly well-positioned because it was already making investments that CEO Tom Watson said are positioned for the new priorities.
The company has spent several years moving into more high-end services for its customers and infusing that front-line work with more technology-enabled tools, he said.
Through many acquisitions over the last seven years, the company has moved higher up the food chain. Serco Inc. has also expanded the work it does for the Navy, Army and Air Force.
According to Watson, the Trump administration has brought an emphasis on several areas that line up with where Serco Inc. has made its investments.
“One of the things that I like is that there is more much more emphasis on readiness and efficiency,” Watson said.
Serco Inc. recently completed its $327 million acquisition of Northrop Grumman’s mission training and satellite ground network communications business. The acquisition also adds $300 million in annual revenue, bringing Serco Inc.’s overall annual revenue to over $2 billion.
Serco Inc. is the North American subsidiary of Serco Group, the U.K.-headquartered parent company, and represented around 28% of global revenue in 2024.
The agreement with Northrop was in the works ahead of Trump’s January inauguration. But the move increases Serco Inc.'s presence at the Army, Air Force and Space Force to complement the company’s Navy business.
Since Watson became CEO in 2022, Serco Inc. has completed three acquisitions including the Northrop MT&S purchase. He joined the company in 2018 as a senior vice president.
“Each acquisition brought us something new, whether it was customer reach, technical capabilities, depth with a particular customer and they reshaped our portfolio,” he said.
Several of Trump’s executive orders align with Serco Inc.'s services, along with contracts the company already holds.
For example, one executive order calls for the modernization of the Navy. Serco Inc. secured a $97 million contract just before the election to support the Navy’s four public shipyards in Norfolk, Virginia; Portsmouth, Maine; Puget Sound, Washington'; and Pearl Harbor, Hawaii.
“Our timing couldn’t have been better,” Watson said. “We are working with the Navy on modernization, process improvement, lean manufacturing processes to bring the shipyards up to a modern standard.”
The administration also wants to expand the fleet and include more autonomous vessels, a growth area for Serco Inc.
Under an other than transaction authority procurement, Serco Inc. has been working with the Defense Advanced Research Projects Agency on the No Manning Required Ship program.
“We’ve built the ship and she’s in the water up in Everette, Washington, outside of Seattle,” Watson said. The ship is undergoing dock trials now and sea trials will begin this summer.
Serco Inc.'s traditional Navy business has been more about technical services, such as swapping out equipment and pulling cables. But its work for the NOMARS program goes well beyond that.
“We wrote all the software for what I’m calling a digital chief engineer,” Watson said. “We are positioning ourselves to be a leader in autonomous systems.”
Autonomous systems aboard the NOMARS Defiant vessel include collision avoidance and navigation.
“But there are a million things that go on below the waterline –pumps, power, water, fuel – all of those types of things have been done by people,” Watson said. “We’ve designed a way to do all of that with autonomous systems, and we wrote all the software for that.”
He called what Serco is doing “revolutionary” because of the Navy’s goal to bring more lethality to the fleet on a quicker pace and at lower costs.
Defiant is not a small vessel, measuring out at 180 feet in length and 240 tons of weight. Watson said he could not disclose the kind of mission systems it can carry, but Naval News says the ship can carry four Adaptable Deck Launchers and has space for 16 strike length Mark 41 missile cells.
“This is a large, unmanned surface vessel that has a lot of capacity for carrying mission system payloads,” Watson said. “In the future we’ll be able to build these things in less than a year at a fraction of the cost of a destroyer and leave them on station for a year without with minimal any human intervention. That’s the goal.”
A second contract win Serco Inc. sees as aligned with the Trump administration is a $247 million Army award booked in September, called Army Holistic Health and Fitness.
The Army 2HF program supports efforts to enhance soldier readiness, optimize physical and non-physical performance, reduce injury rates, and streamline post-injury rehabilitations.
The program had been a pilot program for several years and Serco Inc. won the contract to roll it out globally.
“We're deploying people all over the country, all over the world, and it's perfectly in line with the secretary's goals of increased lethality and readiness for the war fighter,” Watson said.
Serco Inc. has had to hire a two new types of employees – strength and conditioning coaches, and cognitive performance specialists.
“It’s super exciting because at the end of the day it’s about creating individualized training plans for soldiers,” Watson said. “It involves both the physical and mental health of individuals, training, nutrition, recovery, avoidance of injury. It’s the way we need to be training our soldiers today.”