Northrop Grumman contract for network-centric solutions awarded $40.4M by the Air Force

Contract Overview

Contract Amount: $40,439,004 ($40.4M)

Contractor: Northrop Grumman Information Technology Inc

Awarding Agency: Department of Defense

Start Date: 2013-06-28

End Date: 2015-09-09

Contract Duration: 803 days

Daily Burn Rate: $50.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IGF::OT::IGF NETWORK CENTRIC SOLUTIONS

Place of Performance

Location: WARNER ROBINS, HOUSTON County, GEORGIA, 31098, UNITED STATES OF AMERICA

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $40.4 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC for work described as: IGF::OT::IGF NETWORK CENTRIC SOLUTIONS Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 3. The duration of 803 days indicates a medium-term project. 4. The award amount of $40.4M falls within a moderate spending range for IT services. 5. The North American Industry Classification System (NAICS) code 517110 points to services within the telecommunications sector.

Value Assessment

Rating: fair

The contract value of $40.4 million for wired telecommunications carrier services over approximately 2.2 years appears to be within a reasonable range for a project of this nature. However, without specific details on the scope of work and deliverables, a precise value-for-money assessment is challenging. Benchmarking against similar network-centric solutions contracts would provide a clearer picture of whether the pricing reflects competitive market rates. The Cost Plus Fixed Fee structure necessitates close monitoring to ensure costs remain controlled and do not exceed initial estimates.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of multiple bidders, though not explicitly stated in the provided data, is generally implied by this competition type. A robust competitive process typically leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it fosters a marketplace where contractors vie for the best price and performance, ultimately aiming to secure the most cost-effective solution for government needs.

Public Impact

The primary beneficiary is the Department of the Air Force, which receives network-centric solutions. Services delivered likely involve the maintenance, upgrade, or provision of wired telecommunications infrastructure. The geographic impact is likely concentrated within areas served by the Air Force's network infrastructure, potentially nationwide or at specific installations. Workforce implications may include employment for telecommunications engineers, technicians, and project managers within Northrop Grumman and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts carry inherent risks of cost escalation if not meticulously managed and overseen.
The lack of specific performance metrics in the provided data makes it difficult to assess the contractor's performance trajectory.
The duration of the contract (803 days) could indicate potential for scope creep if not clearly defined from the outset.

Positive Signals

Awarded through full and open competition, suggesting a competitive environment that can drive value.
Northrop Grumman is a large, established defense contractor with significant experience in IT and network solutions.
The contract is for essential network-centric solutions, indicating a critical need for the Air Force's operations.

Sector Analysis

This contract falls within the Information Technology (IT) and Telecommunications sector, specifically focusing on wired telecommunications carriers. This sector is characterized by rapid technological advancements and significant government spending on infrastructure and services to support national security and operational needs. The market size for such services is substantial, with numerous large and small businesses competing for government contracts. Comparable spending benchmarks would typically involve analyzing other large-scale telecommunications infrastructure projects awarded by defense agencies.

Small Business Impact

The data indicates that small business participation (sb) was not a specific set-aside for this contract (sb: false). There is no explicit information on subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem is unclear, though large prime contractors like Northrop Grumman often engage small businesses as subcontractors on projects of this scale.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program management personnel within the Department of the Air Force. Accountability measures would be tied to the terms and conditions of the Cost Plus Fixed Fee contract, including regular reporting and audits. Transparency is generally facilitated through contract award databases, though detailed performance data may be less accessible. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Defense Information Systems Agency (DISA) contracts
Air Force Network Integration Center (AFNIC) procurements
General Services Administration (GSA) IT Schedule contracts
Wired Telecommunications Services
Network Infrastructure Modernization Programs

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage potential cost overruns.
Lack of detailed performance metrics makes it difficult to assess contractor efficiency and effectiveness.
The scope of 'network-centric solutions' can be broad, necessitating clear definition to avoid scope creep.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $40.4 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC. IGF::OT::IGF NETWORK CENTRIC SOLUTIONS

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 (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $40.4 million.

What is the period of performance?

Start: 2013-06-28. End: 2015-09-09.

What is the specific scope of work for these network-centric solutions?

The provided data identifies the contract under NAICS code 517110 (Wired Telecommunications Carriers) and the description 'IGF::OT::IGF NETWORK CENTRIC SOLUTIONS'. This suggests the contract likely involves the provision, maintenance, or upgrade of wired communication infrastructure and related services for the Air Force. Specific deliverables could range from installing and managing fiber optic networks, ensuring connectivity for bases and facilities, to implementing secure communication pathways. Without access to the full contract statement of work (SOW), the precise technical requirements, performance standards, and end-state objectives remain undefined.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for similar IT services?

Cost Plus Fixed Fee (CPFF) contracts are often used when the scope of work is not precisely defined or is expected to evolve, allowing for flexibility. However, they carry a higher risk of cost overruns compared to fixed-price contracts, as the government bears the cost of performance plus a predetermined fixed fee. For IT services where requirements are well-defined, fixed-price contracts (like FFP or FP-EPA) are generally preferred for better cost control. CPFF requires robust government oversight to manage expenditures and ensure the contractor remains efficient. Other common types include Cost Plus Incentive Fee (CPIF), which adds performance incentives, and Time and Materials (T&M), typically for smaller efforts or when scope is highly uncertain.

What is Northrop Grumman's track record with similar Air Force network contracts?

Northrop Grumman Information Technology Inc. (now part of Northrop Grumman Corporation) has a long history of supporting the Department of Defense, including the Air Force, with a wide array of IT and C4ISR (Command, Control, Communications, Computers, and Intelligence, Surveillance, and Reconnaissance) services. They have been involved in numerous large-scale network modernization, sustainment, and cybersecurity programs. While specific performance details for this $40.4M contract are not detailed here, their extensive experience suggests a capacity to handle complex network-centric solutions. A deeper analysis would involve reviewing past performance evaluations and any documented issues or successes on comparable Air Force contracts.

What are the potential risks associated with the 'Wired Telecommunications Carriers' classification?

The 'Wired Telecommunications Carriers' classification (NAICS 517110) primarily relates to companies that provide telecommunications services through a network of wires, including telephone, cable, and broadband internet services. Risks associated with contracts in this area can include reliance on aging infrastructure, the need for continuous upgrades to keep pace with technological advancements (e.g., fiber optics, 5G integration), cybersecurity vulnerabilities inherent in network systems, and potential disruptions from physical damage or environmental factors. Ensuring the security, reliability, and scalability of the wired network is paramount for mission-critical operations.

How does the $40.4 million award amount compare to typical spending on network infrastructure by the Air Force?

The $40.4 million award is a significant sum, but within the context of the Department of Defense's overall IT and telecommunications budget, it represents a mid-tier contract. The Air Force, in particular, invests heavily in maintaining and modernizing its vast global network infrastructure. Large-scale network modernization programs can run into hundreds of millions or even billions of dollars. Therefore, this contract likely addresses a specific segment or project within a broader network strategy, such as upgrading infrastructure at a particular base, enhancing regional connectivity, or implementing a new service capability. Benchmarking against other specific network infrastructure contracts awarded by the Air Force over the past five years would provide a more precise comparison.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

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: 7575 COLSHIRE DRIVE, MCLEAN, VA, 22102

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $40,439,004

Exercised Options: $40,439,004

Current Obligation: $40,439,004

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA877104D0004

IDV Type: IDC

Timeline