SAIC to Cut $350 Million in Costs

McLean-based Science Applications International Corp. said Tuesday it plans to cut $350 million in annual costs, primarily by trimming staff and facilities and pushing for greater savings in what it buys, according to a report in the Washington Post.

K. Stuart Shea, chief operating officer of SAIC, said in a call with investors that the contractor plans to cut about $220 million annually by simplifying its organizational structure and cutting administrative or so-called “indirect” staff not tied to specific contracts, the Post reported, noting he said SAIC has already trimmed about 800 indirect employees – who typically work in areas like human resources, accounting and payroll. Another $70 million in savings will come from reducing SAIC’s facility footprint by about 30 percent by accelerating lease terminations and encouraging employee telework, and SAIC also plans to save about $30 million through improving its corporate procurement.