In July 2010, Vincent Pavlak, a partner in KPMG LLP’s Transactions & Restructuring service group, contributed an article to Defense Industry Daily, titled, “Lessons from the Automotive Supply Chain: Surviving a Downturn.” At the time, the automotive industry was enduring one of the worst economic periods in history, and there were concerns that the aerospace and defense industry could suffer a similar fate. Ultimately, the automotive suppliers that endured the downturn have emerged stronger, due in part to critical efforts undertaken during the crisis. Meanwhile, the aerospace and defense industry has experienced a post-crisis divergence of paths, with commercial aerospace companies enjoying a resurgence parallel to the automotive industry while the defense sector has suffered declining revenues and prospects. Despite differing outlooks now facing each industry, supply chain enhancement presents opportunities for increased competitive advantage for aerospace, defense and other industries across varying economic cycles.
Part 1 looked at supply chain issues and imperatives for aerospace & defense (A&D). Part 2 looks at some implications, trends, and opportunities.
In July 2010, Vincent Pavlak, a partner in KPMG LLP’s Transactions & Restructuring service group, contributed an article to Defense Industry Daily, titled, “Lessons from the Automotive Supply Chain: Surviving a Downturn.” At the time, the automotive industry was enduring one of the worst economic periods in history, and there were concerns that the aerospace and defense industry could suffer a similar fate. Ultimately, the automotive suppliers that endured the downturn have emerged stronger, due in part to critical efforts undertaken during the crisis. Meanwhile, the aerospace and defense industry has experienced a post-crisis divergence of paths, with commercial aerospace companies enjoying a resurgence parallel to the automotive industry while the defense sector has suffered declining revenues and prospects. Despite differing outlooks now facing each industry, supply chain enhancement presents opportunities for increased competitive advantage for aerospace, defense and other industries across varying economic cycles.
Part 1 deals with the key challenges facing these industries’ supply chains.
In February 2012, the USAF has issued a 6-year, multiple-award contract worth up to $985 million, to support the USAF Medical Service. Winners will have the chance to bid on delivery orders under the mixed indefinite-delivery/ indefinite quantity, firm-fixed-price, cost-plus-fixed-fee contract. Services will include management and professional support services, engineering and technical services, and studies, analyses and evaluations over the 6-year period, to Feb 1/18.
Air Force Medical Services includes all 5 USAF medical corps (Biomedical sciences, Dental, Medical, Medical service, Nurse) and enlisted medical technicians, and is led by a Surgeon General. They’re likely to find themselves rather busy over the next few years. In addition to this services contract, a separate multiple-vendor program is getting ready to devote up to $900 million over the next 5 years, for the AFMS Healthcare Facilities Modernization Program. The USAF’s 773th ESS/PKJ manages the services contract, and eligible bidders for task orders include:
On Dec 25th, UK servicemen and women posted overseas in countries such as Iraq, Afghanistan, the Balkans and the Falkland Islands receive a Christmas box filled with gifts. Inspired by a tradition that dates back to the First World War, the Christmas box program was established 3 years ago by charity UK4U; this year, they distributed gifts to more than 25,000 British troops. The final send off for the items took place on Dec 22/07 this year, and the UK MoD has a feature describing their receipt.
What a fine idea. This worthy program is made possible by industry sponsors, including:
Angliss BAE Systems
Cooneen Watts & Stone
DBC Foodservice
Deloitte
EADS (UK)
Farside Marketing
Finmeccanica (UK)
Fleet Air Arm Association
Fra Angelico
Fretwell Downing Hospitality
Gifts by Design
J C Bamford Excavators
KBR Halliburton
Lockheed Martin Corporation
Marks and Spencer
Northrup Grumman
NP Aerospace (England)
Afghanistan, 2007
Nuffield Trust for Forces of the Crown
PA Consulting Group
PRA Architects
Purple Food Service Solutions
QinetiQ Group
Right Management
Rolls Royce
Royal Photographic Society
Sodexho Defence Service
Supreme FoodService
Thistle Garments
Twinings of London
Web-Tex
Wilkinson Sword
Yellow Ribbon Foundation
The US General Services Administration (GSA) is a procurement hub for many US government agencies. In late July 2007, the GSA announced a continued special focus on easing acquisitions for its largest customer, the Department of Defense (who has some surprising most-requested GSA items), including the launch of a full DoD/GSA portal site.
They’ve also just announced the selection of 29 firms for award under the maximum $50 billion Alliant Governmentwide Acquisition Contract. The Alliant umbrella contract provides all US federal government agencies, including the Pentagon, with a centralized source to acquire integrated Information Technology (IT) solutions worldwide. The contract has a 5-year base period with a 5-year option period, and replaces two similar contracts set to expire: Millenia, and ANSWER (Applications ‘N Support for Widely diverse End user Requirements)…
Price Waterhouse Coopers L.L.P. in Washington, DC received a delivery order amount of $7.5 million as part of a $16.8 million firm-fixed-price contract to conduct a financial statement audit of the U.S. Army Corps of Engineers Civil Works FY 2007 financial statements.
Work will be performed in Washington, DC and is expected to be complete by April 25, 2008. There were 5 bids solicited on March 20, 2006, and 5 bids were received by the Washington Headquarters Services in Arlington, VA (N00421-05-D-0025).
The US Navy has issued a set of consulting firm contracts to help the Director of Material Readiness and Logistics (OPNAV N4) with business process improvements. These are cost-plus-fixed-fee, indefinite-delivery/ indefinite-quantity contracts with options. Contract funds associated with the contract guaranteed minimum amounts will expire Sept. 2007, while work is expected to be complete Mar. 2008. Work will be performed in Washington, DC (95%); and other Department of Navy CONUS(CONtinental US) locations (5%). These contracts were competitively procured and solicited through Navy Electronic Commerce Online, with 15 offers received by the Fleet and Industrial Supply Center Norfolk, Contracting Department, Philadelphia Division. Winners included:
Accenture National Security Services LLC in Reston, VA. $11.6 million, $57.5 million if all options are exercised (N00189-07-R-Z018).
AMSEC LLC in Virginia Beach, VA. $8.9 million, $44 million if all options are exercised (N00189-07-R-Z019).
Booz Allen Hamilton Inc. in McLean, VA. $9.5 million, $47 million if all options are exercised (N00189-07-R-Z020).
IBM in Fairfax, VA. $9.3 million, $47 million if all options are exercised (N00189-07-R-Z021).
The U.S. Department of Homeland Security’s Secure Border Initiative (SBI) is a comprehensive plan to secure U.S. borders and reduce illegal immigration, including an array of technical aids and elements on both the northern Canadian border and the southern border with Mexico. The U.S. Customs and Border Protection Agency will lead and execute both the SBI and related SBInet efforts, and a $2 billion SBInet contract is expected to be awarded in September 2006. Boeing IDS President & CEO Jim Albaugh has described SBInet as “an initiative of national significance addressing a global problem,” and both Boeing IDS and Raytheon are currently prepping teams for the bid.
The Boeing-led SBInet team includes the following major contractors: DRS Surveillance and Reconnaissance Group in Palm Bay, FL; DRS Technologies in Parsippany, NJ; Kollsman,Inc. in Merrimack, NH, an Elbit Systems of America company; L-3 Communications in Washington, D.C.; L-3 Communication Systems – West in Salt Lake City, UT; Perot Systems in Plano, TX; and Unisys Global Public Sector in Reston, VA.
Raytheon leads a team that includes: Apogen Technologies, Inc. in McLean, VA; BAE Systems, Inc. in Rockville, MD; Bechtel National, Inc. in Frederick, MD; Deloitte Consulting LLP in New York, NY; and IBM in Armonk, NJ. Interestingly, Raytheon is citing is leadership of Brazil’s SIVAM (System for Vigilance of the Amazon) program and its 30 subcontractors as a key qualification that’s comparable in scope and complexity to the USA’s SBInet.
The Naval Air Systems Command Aircraft Division in Patuxent River, MD awarded a pair of contracts for planning, programming, and financial support. The scope is to accomplish all aspects of program life cycle management necessary, in order to meet the acquisition responsibilities of its carrier-capable E-2C Hawkeye AWACS/ C-2 Greyhound cargo aircraft.
These modifications exercise an option under previously awarded indefinite-delivery/ indefinite-quantity contract, and combine purchases for the United States Navy and the governments of France, Taiwan, Egypt, Japan, and Singapore under the Foreign Military Sales Program. Additional FMS purchases may include the governments of the United Arab Emirates, India, Pakistan, Malaysia, Thailand and Oman.
Accenture, LLP in Reston, VA is being awarded a maximum $6.3 million firm-fixed-price contract for Informational Technology Services for the Defense Logistics Agency. The performance completion date is Dec. 5, 2006. There were six proposals submitted and three responded. The contracting activity is the Defense Supply Center Philadelphia, Philadelphia, PA (SP0103-05-F-A130).
