Northrop Grumman's $20.5M contract for combat identification sensors shows R&D focus in physical sciences

Contract Overview

Contract Amount: $20,502,499 ($20.5M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2018-10-25

End Date: 2025-09-30

Contract Duration: 2,532 days

Daily Burn Rate: $8.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: PRECISION REAL-TIME ENGAGEMENT COMBAT IDENTIFICATION SENSOR EXPLOITATION (PRECISE)

Place of Performance

Location: LINTHICUM HEIGHTS, ANNE ARUNDEL County, MARYLAND, 21090

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $20.5 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: PRECISION REAL-TIME ENGAGEMENT COMBAT IDENTIFICATION SENSOR EXPLOITATION (PRECISE) Key points: 1. Contract focuses on advanced research and development in physical sciences, aligning with specialized technological advancements. 2. The definitive contract structure suggests a long-term engagement for a specific research objective. 3. Competition was full and open, indicating a broad market search for the best technical solution. 4. The contract's duration of 2532 days points to a significant, multi-year research effort. 5. Research and Development in Physical, Engineering, and Life Sciences is a critical area for defense modernization.

Value Assessment

Rating: fair

Benchmarking the value of this specific R&D contract is challenging due to its specialized nature and the lack of directly comparable public data. The cost-plus-fixed-fee (CPFF) structure means costs can fluctuate, but the fixed fee provides some predictability. Without detailed cost breakdowns or performance metrics, a definitive value assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple capable contractors had the opportunity to bid. This level of competition is generally favorable for price discovery and ensuring the government receives competitive proposals. The presence of 3 bidders, as indicated, further supports the notion of a reasonably competitive environment for this specialized R&D effort.

Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down costs and encouraging innovation from a wider pool of contractors, leading to potentially better solutions at a more reasonable price.

Public Impact

The primary beneficiaries are the Department of Defense and specifically the Air Force, which will receive advanced combat identification sensor technology. The services delivered involve research and development, aiming to enhance situational awareness and combat effectiveness. The geographic impact is likely concentrated within defense research facilities and potentially operational units upon deployment. Workforce implications include specialized engineers, scientists, and technicians involved in the R&D process.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can lead to cost overruns if not managed diligently.
The long duration of the contract increases the risk of scope creep or evolving technological requirements.
Specific performance metrics and deliverables are not detailed, making it hard to assess progress and success.
Reliance on a single large contractor for critical R&D may limit future market flexibility.

Positive Signals

Full and open competition suggests a robust search for the best technical solution.
The contract is for research and development, indicating investment in future technological capabilities.
The definitive contract type implies a clear objective and scope for the R&D effort.
Northrop Grumman is a major defense contractor with extensive experience in aerospace and defense systems.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This area is crucial for defense modernization, encompassing advancements in sensor technology, artificial intelligence, and materials science. The market for defense R&D is characterized by significant government investment, long development cycles, and a need for highly specialized expertise. Comparable spending benchmarks are difficult to establish due to the unique nature of R&D contracts, but overall defense R&D spending represents a substantial portion of the defense budget.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. The prime contractor, Northrop Grumman, is a large aerospace and defense company. While large prime contractors often have subcontracting plans that include small businesses, the direct award does not prioritize small business participation. The impact on the small business ecosystem would depend on whether Northrop Grumman actively seeks small business subcontractors for specialized components or services related to this R&D effort.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Air Force contracting and program management offices. Accountability measures are typically embedded within the contract's terms, including reporting requirements, milestone reviews, and performance evaluations. Transparency is often limited for classified or sensitive R&D projects, but standard contract reporting mechanisms should be in place. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Advanced Sensor Development Programs
Combat Identification Systems
Defense Research and Development
Air Force Science and Technology Investments
Electronic Warfare Systems
Intelligence, Surveillance, and Reconnaissance (ISR) Technology

Risk Flags

Long contract duration increases risk of obsolescence and scope creep.
Cost-plus-fixed-fee contracts require diligent oversight to manage costs.
Specific performance metrics and deliverables are not publicly detailed.
R&D focus means outcomes are uncertain and may not yield immediate deployable solutions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.5 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. PRECISION REAL-TIME ENGAGEMENT COMBAT IDENTIFICATION SENSOR EXPLOITATION (PRECISE)

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 (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $20.5 million.

What is the period of performance?

Start: 2018-10-25. End: 2025-09-30.

What is the specific technological objective of the PRECISE contract?

The PRECISE (PRECISION REAL-TIME ENGAGEMENT COMBAT IDENTIFICATION SENSOR EXPLOITATION) contract aims to advance the capabilities of combat identification sensor technology. While the exact specifications are not publicly detailed, the contract's focus on 'Research and Development in the Physical, Engineering, and Life Sciences' suggests efforts to improve the accuracy, speed, and reliability of identifying friendly, neutral, and hostile forces in complex combat environments. This likely involves developing new sensor hardware, advanced signal processing algorithms, and data fusion techniques to enhance situational awareness and reduce fratricide.

How does the Cost Plus Fixed Fee (CPFF) contract type influence cost control for this R&D effort?

The Cost Plus Fixed Fee (CPFF) contract type is common for R&D where the scope and final costs are uncertain. Under CPFF, the contractor is reimbursed for allowable costs plus a predetermined fixed fee representing profit. This structure incentivizes the contractor to control costs to maximize their profit margin, as the fee is fixed regardless of the final cost. However, it also requires robust government oversight to ensure costs are reasonable and allocable to the contract. For this $20.5 million contract, the fixed fee provides a ceiling on the contractor's profit, but the total cost can still vary based on the R&D process.

What are the potential risks associated with the long duration (2532 days) of this contract?

A contract duration of 2532 days (approximately 7 years) for R&D presents several risks. Firstly, technological obsolescence is a significant concern; the technology being developed might be outdated by the time the contract concludes, or advancements by competitors could surpass it. Secondly, requirements can evolve over such a long period, potentially leading to scope creep, contract modifications, and increased costs if not managed carefully. Thirdly, maintaining contractor focus and performance over an extended period requires continuous oversight and engagement from the government. Finally, the long timeline increases the risk of personnel turnover within both the contractor's team and the government's oversight team, potentially impacting knowledge continuity.

What does the 'Research and Development in the Physical, Engineering, and Life Sciences' classification imply for the contract's focus?

The NAICS code 541715, 'Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology),' indicates that this contract is focused on scientific inquiry and experimentation to advance knowledge and capabilities in these fundamental fields. For the PRECISE contract, this likely means the work involves developing new physical principles, engineering novel systems or components, and potentially understanding biological factors relevant to combat identification. It suggests a focus on foundational research and applied engineering rather than the direct procurement of off-the-shelf systems, aiming for breakthrough capabilities.

How does this contract fit into the broader context of Department of Defense modernization efforts?

This contract aligns with the Department of Defense's continuous efforts to modernize its capabilities, particularly in enhancing situational awareness and reducing the risk of fratricide. Advanced combat identification systems are critical for maintaining information superiority on the battlefield. By investing in R&D through contracts like PRECISE, the DoD seeks to develop next-generation technologies that can provide a decisive advantage against potential adversaries. This specific contract contributes to the broader goal of creating a more connected, intelligent, and lethal force.

What is Northrop Grumman's track record in similar R&D and sensor technology contracts?

Northrop Grumman Systems Corporation is a major defense contractor with a long history and extensive experience in aerospace, defense, and information systems. They have a well-established track record in developing and producing advanced sensor systems, electronic warfare capabilities, and integrated battle management systems for various military branches, including the Air Force. Their portfolio includes numerous R&D contracts and production programs involving complex technologies. While specific details of past performance on contracts identical to PRECISE are not publicly available, their overall experience suggests a strong capability to undertake and execute such specialized research and development efforts.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: BASIC RESEARCH

Solicitation ID: FA865018S1672

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 1580B W NURSERY RD, LINTHICUM HEIGHTS, MD, 21090

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $20,507,378

Exercised Options: $20,507,378

Current Obligation: $20,502,499

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline