Northrop Grumman Systems Corporation awarded $407.9M contract for R&D services by Defense Information Systems Agency
Contract Overview
Contract Amount: $407,908,916 ($407.9M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2010-07-30
End Date: 2015-01-25
Contract Duration: 1,640 days
Daily Burn Rate: $248.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: LABOR/ODCS - BASE YEAR
Place of Performance
Location: MADISON, MADISON County, ALABAMA, 35758
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $407.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: LABOR/ODCS - BASE YEAR Key points: 1. Contract awarded via full and open competition, suggesting a broad market search. 2. The contract type is Cost Plus Fixed Fee (CPFF), which can incentivize cost overruns. 3. The base year value of over $400M indicates a significant investment in R&D. 4. The contract duration of 1640 days (approx. 4.5 years) suggests a long-term project. 5. The North American Industry Classification System (NAICS) code 541712 points to R&D in physical, engineering, and life sciences. 6. The contract was awarded as a delivery order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract.
Value Assessment
Rating: fair
Benchmarking the value of this contract is challenging without knowing the specific R&D objectives and deliverables. However, the substantial base year value of over $400 million suggests a significant investment. The CPFF contract type carries inherent risks of cost escalation compared to fixed-price contracts. Further analysis would require understanding the scope of work and comparing it to similar R&D efforts within the Department of Defense.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that the Defense Information Systems Agency (DISA) sought proposals from all responsible sources. The number of bidders is not specified, but this approach generally fosters a competitive environment, which can lead to better pricing and innovation. The open competition suggests that the agency aimed to leverage the widest possible pool of talent and technology.
Taxpayer Impact: Taxpayers benefit from full and open competition as it typically drives down costs and increases the likelihood of receiving the best value for their investment through a robust selection process.
Public Impact
The primary beneficiaries are likely the Department of Defense and its various branches, receiving advanced research and development outputs. Services delivered are expected to be in the realm of physical, engineering, and life sciences R&D, potentially leading to technological advancements. The geographic impact is primarily within the United States, supporting national defense capabilities. Workforce implications include employment opportunities for scientists, engineers, and support staff at Northrop Grumman and potentially its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee (CPFF) contract type can lead to cost overruns if not managed diligently.
- Lack of specific details on deliverables makes it difficult to assess performance outcomes and value for money.
- The significant dollar amount raises questions about the efficiency and necessity of the R&D investment.
Positive Signals
- Awarded through full and open competition, indicating a potentially competitive and fair process.
- Northrop Grumman is a large, established defense contractor with a track record in complex R&D projects.
- The contract supports critical research and development for national defense.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The defense R&D market is characterized by significant government investment, long project cycles, and a focus on technological superiority. Comparable spending benchmarks would involve analyzing other large-scale R&D contracts awarded by the Department of Defense and other federal agencies for similar scientific and engineering pursuits.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large prime contract awarded to Northrop Grumman, there may be opportunities for small businesses to participate as subcontractors. However, the extent of small business subcontracting is not detailed in this data and would require further investigation into the contract's subcontracting plan.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of Defense and the Defense Contract Management Agency (DCMA). Accountability measures are typically embedded within the CPFF contract terms, requiring detailed reporting and justification of costs. Transparency is facilitated through contract award databases, but specific project details and performance metrics may be subject to security classifications.
Related Government Programs
- Department of Defense Research and Development Programs
- Defense Information Systems Agency (DISA) Contracts
- Northrop Grumman Systems Corporation Contracts
- Cost Plus Fixed Fee Contracts
- NAICS 541712 Contracts
Risk Flags
- Cost Plus Fixed Fee contract type carries inherent cost overrun risks.
- Lack of specific R&D deliverables makes performance assessment difficult.
- Significant contract value requires robust oversight to ensure value for money.
Tags
research-and-development, department-of-defense, defense-information-systems-agency, northrop-grumman-systems-corporation, cost-plus-fixed-fee, full-and-open-competition, delivery-order, large-contract, technology-development, national-security
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $407.9 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. LABOR/ODCS - BASE YEAR
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $407.9 million.
What is the period of performance?
Start: 2010-07-30. End: 2015-01-25.
What specific research and development objectives does this contract aim to achieve?
The provided data indicates the contract is for 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)' under NAICS code 541712. However, the specific objectives, research areas, and expected outcomes are not detailed. These could range from developing new materials, advancing sensor technologies, improving communication systems, or exploring novel engineering methodologies. A deeper dive into the contract's Statement of Work (SOW) or Performance Work Statement (PWS) would be necessary to understand the precise R&D goals and the anticipated technological advancements or solutions.
How does the $407.9 million base year cost compare to similar R&D contracts within the DoD?
The base year cost of $407.9 million for R&D services is substantial. To benchmark this, one would need to compare it against other large-scale R&D contracts awarded by the Department of Defense (DoD) or its agencies (like DISA) for similar scientific and engineering domains. Factors such as contract duration, scope of work complexity, and the specific technologies being researched are crucial for a meaningful comparison. Without access to a broader dataset of comparable contracts, it's difficult to definitively state whether this represents a high, low, or average investment. However, it clearly signifies a major commitment to a particular R&D initiative.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D?
The primary risk with a Cost Plus Fixed Fee (CPFF) contract, especially for R&D, is the potential for cost overruns. In a CPFF structure, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. If the R&D effort encounters unforeseen challenges or requires more resources than initially estimated, the total cost to the government can escalate significantly beyond initial projections. While the fixed fee provides some cost certainty for the contractor's profit, the overall project cost remains variable. Effective government oversight, stringent cost controls, and clear performance metrics are essential to mitigate these risks.
What is Northrop Grumman's track record with similar R&D contracts for the DoD?
Northrop Grumman Systems Corporation is a major defense contractor with extensive experience in research and development across various domains, including aerospace, defense electronics, and information systems. They have a long history of securing and executing large, complex R&D contracts with the Department of Defense and other government agencies. Their track record typically involves developing and integrating advanced technologies for military applications. Specific performance details on past R&D contracts would require examining individual contract histories, including performance reviews, delivery timeliness, and adherence to budget, which are often available through federal procurement databases and agency reports.
How has spending on R&D services by the Defense Information Systems Agency (DISA) trended historically?
Analyzing historical spending trends for R&D services by DISA would require access to multi-year budget and contract award data. DISA's mission focuses on providing information technology (IT) and communications services to the DoD. Their R&D spending would likely fluctuate based on evolving technological needs, strategic priorities, and budget allocations. Periods of rapid technological change or emerging threats might see increased R&D investment. Conversely, shifts towards operational deployment or consolidation of research efforts could lead to decreased spending. A detailed trend analysis would involve examining annual reports, budget justifications, and contract databases over several fiscal years.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 2340 DULLES CORNER BLVD, HERNDON, VA, 20171
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $407,950,435
Exercised Options: $407,950,435
Current Obligation: $407,908,916
Subaward Activity
Number of Subawards: 95
Total Subaward Amount: $68,772,351
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HC102808D2023
IDV Type: IDC
Timeline
Start Date: 2010-07-30
Current End Date: 2015-01-25
Potential End Date: 2015-01-25 00:00:00
Last Modified: 2018-03-26
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