Tim Hurlebaus, right, new CEO of CGI, and Julie Godin, co-chair of CGI and daughter of the founder, at the company's offices in Montreal on Tuesday.Andrej Ivanov/The Globe and Mail
Canadian IT and management consulting company CGI Inc. GIB-A-T has named Tim Hurlebaus as its new president and chief executive officer as it tries to reverse its sinking share price and build momentum, amid concerns about the effect artificial intelligence firms will have on its business.
Mr. Hurlebaus was most recently CGI’s chief operating officer, with responsibility over operations in the United States, United Kingdom and Australia. Effective immediately, he will replace François Boulanger, who is retiring, CGI said in a statement Tuesday.
Mr. Boulanger served less than two years as CEO and his premature departure suggests founder Serge Godin and the board of directors felt the need for new blood in the CEO seat to navigate the global acceleration of technology development and improve on the company’s recent underperformance.
“These past two years have felt like more than 10 years of change,” executive chairperson Julie Godin said Tuesday, noting CGI wanted someone with deep expertise in technology, knowledge of the industry and an understanding of the company’s operations, culture and strategy.
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Mr. Hurlebaus has the leadership and experience to guide CGI’s growth in this AI-first era, Ms. Godin said. She acknowledged Mr. Boulanger’s contribution to CGI, saying he was instrumental in CGI’s development in various roles over 30 years with the company.
The rise of AI juggernauts such as OpenAI and Anthropic has attracted massive investment to the sector, while raising fears about the impact of their work on more traditional consulting companies such as CGI, Accenture plc, and PricewaterhouseCoopers LLP. A September report by the Harvard Business Review said consulting isn’t disappearing, but will be fundamentally reshaped.
Still, investors remain nervous about that possibility and they’ve soured on IT consulting companies that haven’t done enough to calm concerns about AI disruption. When Mr. Boulanger tried to lay out CGI’s AI strategy on the company’s last earnings call in late April, the stock continued to fall, losing 11 per cent that day from its previous close.
Over Mr. Boulanger’s tenure starting October, 2024, CGI’s share price has fallen more than 40 per cent – mirroring an even larger drop at Accenture. And while merger and acquisition activity picked up last year, CGI’s organic growth in constant currency has been flat to negative, according to TD Securities.
Analysts said the leadership change signals CGI is attempting to reboot the company’s profile in the minds of investors at a critical time.
“It appears the company is looking to reset the narrative around growth, acquisitions and AI with new leadership,” said National Bank of Canada analyst Richard Tse. “The quick pivot is positive.”
Mr. Hurlebaus brings a more tech-focused background to the leadership team, having studied computer information systems, while Mr. Boulanger had a background more focused on finance and accounting, Desjardins analyst Jerome Dubreuil said in a note.
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“This different skill set could be helpful in the context of the rapid technological changes brought by the growing adoption of AI,” Mr. Dubreuil said, adding the new CEO will face several immediate challenges. One example: OpenAI’s launch Monday of a specialized unit to help organizations build and deploy AI systems, which could intensify competition for IT services providers, he said.
Mr. Hurlebaus started his career at CGI as a developer and consultant and has more than 35 years of experience in IT consulting services. He had been identified by the board for years as a possible CEO candidate, Mr. Godin said in a statement.
In an interview with The Globe & Mail Tuesday, Mr. Hurlebaus explained how CGI thinks about AI, adding the company is “very bullish” about the technology as a catalyst for more growth in the years ahead. He said his team recently did an analysis of its top 15 client accounts to look at why they’ve grown or not grown their business with them and there wasn’t a single case where a customer said they wanted less from CGI because they’re getting more from advanced AI.
“There was something else afoot maybe, but that wasn’t the reason,” Mr. Hurlebaus said. “Investors are taking the narrative that that’s what’s happening, and looking at the data, and concluding that that must be it. And what I’m saying is that it’s not showing up in what we’re seeing on the ground. And when I talk to investors, they say, ‘Okay Tim. This sounds fine but show me the growth.’ And I say, ‘Okay, I’ll be back next quarter.’”