Northrop Grumman awarded $30.4M for engineering and technical services, with a 5-year contract duration

Contract Overview

Contract Amount: $30,420,212 ($30.4M)

Contractor: Northrop Grumman Information Technology Inc

Awarding Agency: Department of Defense

Start Date: 2004-03-15

End Date: 2009-06-26

Contract Duration: 1,929 days

Daily Burn Rate: $15.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: Defense

Official Description: 200406!003834!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0702DP002 !A!N! !Y!0029 ! !20040315!20061031!064677243!016435559!016435559!N!NORTHROP GRUMMAN INFORMATION T!7575 COLSHIRE DRIVE !MCLEAN !VA!22102!48376!059!51!MCLEAN !FAIRFAX !VIRGINIA !+000000450736!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !541330!E! !5!B!M! !A! !99990909!B! ! !A! !A!N!Y!2!004!B! !C!N!Z! ! !N!C!N! ! ! !D!D!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: MC LEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $30.4 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC for work described as: 200406!003834!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0702DP002 !A!N! !Y!0029 ! !20040315!20061031!064677243!016435559!016435559!N!NORTHROP GRUMMAN INFORMATION T!7575 COLSHIRE DRIVE !MCLEAN !VA!22102!48376!059!51!MCLEAN !FAIR… Key points: 1. Contract value of $30.4 million for engineering and technical services. 2. Awarded to Northrop Grumman Information Technology Inc. 3. Contract duration spans over 5 years, from March 2004 to June 2009. 4. The contract falls under the 'Engineering Services' category. 5. Procurement was conducted under full and open competition. 6. The contract type is Time and Materials. 7. The primary place of performance is Virginia.

Value Assessment

Rating: fair

The contract value of $30.4 million for over 5 years of engineering and technical services appears to be within a reasonable range for complex defense-related IT and electronics support. However, without specific benchmarks for the exact services rendered, a precise value-for-money assessment is challenging. The Time and Materials pricing structure can sometimes lead to cost overruns if not managed diligently, suggesting a need for close oversight to ensure efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The fact that it was competed openly suggests a healthy market for these types of engineering and technical services. The number of bidders is not specified, but open competition generally fosters price discovery and encourages contractors to offer competitive pricing.

Taxpayer Impact: Taxpayers benefit from the competitive process, which is intended to drive down costs and ensure the government receives the best possible value for its investment in these critical services.

Public Impact

The primary beneficiaries are likely Department of Defense agencies requiring advanced engineering and technical support for electronics and communication equipment. Services delivered include engineering and technical support, crucial for maintaining and developing complex defense systems. The geographic impact is centered in Virginia, where the contractor is located and likely where much of the work is performed. Workforce implications include employment opportunities for engineers, technicians, and support staff within Northrop Grumman and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost creep due to Time and Materials pricing if not closely monitored.
Reliance on a single large contractor for critical engineering services could pose a risk if performance falters.
The long contract duration might lead to less agility in adapting to rapidly changing technological requirements.

Positive Signals

Awarded through full and open competition, suggesting a robust bidding process.
Northrop Grumman is a major defense contractor with significant experience in this sector.
The contract supports critical defense capabilities, indicating a strategic investment.

Sector Analysis

This contract falls within the broader Information Technology and Defense sectors, specifically focusing on engineering services for electronics and communication equipment. The market for such specialized services is substantial within the defense industrial base, with numerous large and small companies competing for government contracts. Benchmarking this contract's value against similar engineering support contracts for defense systems would provide further context on its cost-effectiveness.

Small Business Impact

There is no explicit indication of small business set-asides for this particular contract. However, as a large prime contract awarded to a major corporation, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting would depend on Northrop Grumman's internal policies and the specific requirements outlined in the contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Accountability measures are inherent in the contract terms, including performance standards and payment schedules. Transparency is facilitated through contract databases, although detailed performance reports are often not publicly available.

Related Government Programs

Defense Engineering Services Contracts
Information Technology Support Services
Electronics and Communication Equipment Procurement
Department of Defense IT Spending
Northrop Grumman Defense Contracts

Risk Flags

Time and Materials Pricing Risk
Long-term Contract Dependency
Potential for Scope Creep

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.4 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC. 200406!003834!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0702DP002 !A!N! !Y!0029 ! !20040315!20061031!064677243!016435559!016435559!N!NORTHROP GRUMMAN INFORMATION T!7575 COLSHIRE DRIVE !MCLEAN !VA!22102!48376!059!51!MCLEAN !FAIRFAX !VIRGINIA !+000000450736!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !541330!E! !5!B!M! !A! !999

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $30.4 million.

What is the period of performance?

Start: 2004-03-15. End: 2009-06-26.

What specific engineering and technical services were provided under this contract?

The provided data indicates the contract was for 'ENGINEERING TECHNICAL SERVICES' and falls under the Product Service Code (PSC) 'R425' which relates to 'ENGINEERING SCIENTIFIC AND TECHNICAL ADVISORY SERVICES'. While the exact nature of the services isn't detailed, it generally encompasses design, development, testing, analysis, and integration of electronic and communication systems for defense applications. This could include areas like radar systems, communication networks, electronic warfare, or command and control systems. The '541330' NAICS code further specifies 'Engineering Services', reinforcing the focus on technical expertise and problem-solving for complex defense requirements.

How does the $30.4 million contract value compare to similar engineering services contracts within the Department of Defense?

Comparing the $30.4 million value requires context on the duration and scope. This contract spanned over five years (March 2004 - June 2009), averaging approximately $6 million per year. For large-scale defense engineering and technical services, this amount is moderate. Major system development or sustainment contracts can run into hundreds of millions or billions of dollars. However, for specialized engineering support, particularly for specific electronic or communication systems, $6 million annually is a significant but not extraordinary figure. Benchmarking would ideally involve looking at contracts with similar PSC codes (like R425) and NAICS codes (541330) awarded around the same period to similar-sized contractors within the DoD.

What are the potential risks associated with a Time and Materials contract of this magnitude and duration?

Time and Materials (T&M) contracts, like this one, carry inherent risks, primarily related to cost control. The government pays for the actual labor hours and material costs incurred by the contractor, plus a fixed fee or labor hour rate. The main risk is that costs can escalate beyond initial estimates if the project scope is not well-defined or if inefficiencies arise. For a $30.4 million contract over five years, there's a significant potential for cost overruns if work is not managed efficiently and effectively. Robust oversight, detailed tracking of hours and expenses, and clear task definitions are crucial to mitigate these risks and ensure value for taxpayer money.

What was Northrop Grumman's track record or experience with similar contracts prior to this award?

Northrop Grumman, and its predecessor entities, have a long and extensive history of performing complex engineering, technical, and IT services for the Department of Defense and other government agencies. Prior to this 2004 award, the company (or its relevant divisions) would have had substantial experience in areas related to electronics, communications, and defense systems integration. Their track record would likely include numerous large-scale contracts involving research, development, sustainment, and modernization of military hardware and software. This extensive background would have been a key factor in their ability to win a competitive bid for this significant engineering services contract.

How did the 'full and open competition' impact the pricing and selection of Northrop Grumman?

Full and open competition means that all responsible sources were permitted to submit a bid, and the contract was awarded to the responsible offeror whose proposal, conforming to the solicitation, was most advantageous to the Government, price and other factors considered. This competitive environment typically drives down prices as contractors vie for the award. For this $30.4 million contract, the open competition likely pressured Northrop Grumman to offer competitive pricing and demonstrate superior technical capabilities to win. The selection process would have involved evaluating proposals based on predefined criteria, which could include technical approach, past performance, management capability, and price, ensuring the government secured the best overall value.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 4

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation (UEI: 967356127)

Address: 7575 COLSHIRE DRIVE, MC LEAN, VA, 22102

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DAAB0702DP002

IDV Type: IDC

Timeline