DoD's $479M Mission Command Training Program contract with Northrop Grumman faces scrutiny over cost and competition
Contract Overview
Contract Amount: $478,834,405 ($478.8M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2018-09-28
End Date: 2026-04-14
Contract Duration: 2,755 days
Daily Burn Rate: $173.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: MISSION COMMAND TRAINING PROGRAM (MCTP)
Place of Performance
Location: FORT LEAVENWORTH, LEAVENWORTH County, KANSAS, 66027
State: Kansas Government Spending
Plain-Language Summary
Department of Defense obligated $478.8 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: MISSION COMMAND TRAINING PROGRAM (MCTP) Key points: 1. The contract's significant value raises questions about cost-effectiveness and potential for overspending. 2. Despite 'Full and Open Competition', the long-term nature and specific requirements may limit true market competition. 3. The 'Cost Plus Fixed Fee' structure introduces risk if costs escalate beyond initial projections. 4. The 'Other Computer Related Services' NAICS code suggests a broad scope, potentially masking specific service costs.
Value Assessment
Rating: questionable
The contract's total value of $478.8M over its duration is substantial. Benchmarking against similar IT services contracts is difficult without more granular cost data, but the 'Cost Plus Fixed Fee' structure warrants careful monitoring for potential cost overruns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'Full and Open Competition'. However, the duration and specific nature of training services might have limited the number of truly competitive bids, potentially impacting price discovery.
Taxpayer Impact: The substantial contract value means taxpayers are funding a significant portion of this training program. Ensuring cost efficiency and value for money is crucial to minimize taxpayer burden.
Public Impact
Military readiness and training effectiveness are directly impacted by the quality and cost of this program. Taxpayer funds are allocated to this contract, necessitating transparency and accountability in its execution. The long-term nature of the contract suggests a sustained need for these services within the Department of Defense.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee structure
- Long contract duration
- Broad NAICS code
- Lack of small business participation
Positive Signals
- Awarded under Full and Open Competition
- Supports critical military training
Sector Analysis
The Department of Defense is a major consumer of IT and professional services. Benchmarks for similar large-scale training and simulation contracts are often in the hundreds of millions, but specific cost-per-unit analysis is challenging without detailed breakdowns.
Small Business Impact
The data indicates that small businesses were not significantly involved in this contract, as 'sb' is false. This suggests a lack of subcontracting opportunities for small businesses in this specific award.
Oversight & Accountability
The contract's long duration and significant value necessitate robust oversight from the Department of the Army to ensure performance standards are met and costs remain controlled. Regular reviews and audits are essential for accountability.
Related Government Programs
- Other Computer Related Services
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Potential for cost overruns due to CPFF structure
- Limited visibility into specific cost components
- Risk of reduced competition over contract duration
- Lack of small business participation
- Broad NAICS code may obscure specific service costs
Tags
other-computer-related-services, department-of-defense, ks, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $478.8 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. MISSION COMMAND TRAINING PROGRAM (MCTP)
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 Army).
What is the total obligated amount?
The obligated amount is $478.8 million.
What is the period of performance?
Start: 2018-09-28. End: 2026-04-14.
What is the breakdown of costs within the 'Cost Plus Fixed Fee' structure, and how are potential cost escalations managed?
The 'Cost Plus Fixed Fee' (CPFF) structure means the contractor is reimbursed for allowable costs plus a predetermined fixed fee. Managing cost escalations requires stringent oversight, clear definition of allowable costs, and regular audits to prevent contractor overspending. Without a detailed cost breakdown, it's difficult to assess the reasonableness of the fee relative to the effort and risk involved.
How does the 'Full and Open Competition' process ensure genuine price discovery for specialized training services?
While 'Full and Open Competition' aims for broad market participation, the specialized nature of Mission Command Training might limit the pool of qualified bidders. Effective price discovery relies on a competitive landscape where multiple capable vendors submit realistic proposals. The long duration and specific requirements could inadvertently favor incumbent providers or limit the number of truly competitive offers, potentially impacting the final negotiated price.
What is the measurable impact of this contract on military readiness and training effectiveness?
The contract's direct purpose is to enhance military readiness through effective training. Measuring this impact involves assessing improvements in soldier and unit performance metrics, successful simulation outcomes, and feedback from training participants. Quantifying the precise return on investment for this $479M contract requires specific performance metrics and evaluation frameworks established by the Department of the Army.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W911S016R0007
Offers Received: 4
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 2340 DULLES CORNER BLVD, HERNDON, VA, 20171
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $508,505,312
Exercised Options: $508,505,312
Current Obligation: $478,834,405
Actual Outlays: $120,780,759
Subaward Activity
Number of Subawards: 219
Total Subaward Amount: $1,226,712,502
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2018-09-28
Current End Date: 2026-04-14
Potential End Date: 2026-04-14 00:00:00
Last Modified: 2026-01-06
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