The U.S. Joint Forces Command (USJFCOM) awarded 4 major defense contractors up to $1 billion in contracts to provide analysis, research and development, concept development and support. The new contracts replace a large contract that is scheduled to expire July 31/09.
The winning firms will support USJFCOM’s Joint Concept Development and Experimentation Directorate (J9), which coordinates U.S. Department of Defense efforts to explore how the future military can successfully operate in complex, ever-changing and uncertain environments. J9 runs exercises, undertakes technology development, and works with the military to develop better “concepts of operations” and ways of doing things…
Campbell Ewald Co. won an indefinite-delivery/indefinite-quantity contract for advertising and marketing services for the Navy Recruiting Command in Millington, TN. This contract is worth $146.2 million over the base year, and 4 one-year options could bring its total value to $806.5 million.
Most of this work will be performed at Campbell Ewald’s Warren, MI, facility and the base year ends in May 2010. This contract was competitively procured via Navy Electronic Commerce Online, with 4 offers received by the Fleet and Industrial Supply Center Norfolk’s Contracting Department in Philadelphia, PA (N00189-09-D-Z040).
Campbell Ewald has been working with the Navy on recruiting-related contracts since 2000. In 2005, following a major account review, they scored a major $400+ million win. The firm is responsible for Navy campaigns like “Accelerate Your Life” and NavyforMoms.com, and has expanded the Navy’s reach into social networking communities. That Navy-related work has won over 80 industry awards since 2000. See also Campell Ewald’s release, which includes sample marketing segments.
The commercial world is moving toward Agile Programming models, in part as a solution to its perennial problems with late and over-budget releases. For various reasons, that could prove to be a difficult transition in the defense industry.
On Sept 24/08, DID’s “AIA Concerned By Future Shortage of Qualified American Aerospace Workers” gave voice to a long-standing concern in the American aerospace industry – and added some alarming figures to the debate. Good STEM (Science, Technology, Engineering, and Math) education is the foundation, but by Grade 12, American youths have fallen from solid international competitiveness in Grade 4 to a position that’s near the bottom among advanced countries. When this trend, and college graduate composition, are coupled with a rapidly-aging aerospace workforce, AIA is right to be concerned.
Over the past month, a pair of releases from Northrop Grumman shine a light on some of that firm’s efforts to improve the quality of STEM education in its local communities, including a very innovative facility and a financial grant program for schools…
In 2009, the Ottawa Citizen’s defense reporter David Pugliese reported that the US military was about to spend $100 million to upgrade the facilities at Kandahar, Afghanistan, in order to accommodate up to 26 aircraft for a local “Task Force ODIN”. At first glance, this might seem like just another infrastructure play – unless one realizes that Task Force ODIN (Observe, Detect, Identify & Neutralize) may be the second-most underrated fusion of technology and operating tactics in America’s counter-insurgency arsenal.
Task Force ODIN was created on orders of Gen. Richard A. Cody, the US Army’s outgoing vice chief of staff. Its initial goal involved better ways of finding IED land mines, a need triggered by the limited numbers of USAF Predator UAVs in Iraq, and the consequent refusal of many Army surveillance requests. Despite its small size (about 25 aircraft and 250 personnel) and cobbled-together nature, Task Force ODIN quickly became a huge success. Operating from Camp Speicher near Tikrit, it expanded its focus to become a full surveillance/ strike effort in Iraq – one that ground commanders came to see as more precise than conventional air strikes, hence less likely to create the kind of collateral damage that would damage their campaigns. From its inception in July 2007 to June 2008, the effort reportedly killed more than 3,000 adversaries, and led to the capture of almost 150 insurgent leaders.
Environmental Leader magazine has a pair of stories covering achievements in the defense sector:
Lockheed Martin received several awards in 2008 for its progress towards the aggressive 25% reduction goals for carbon, waste, and water use it had set in 2007. The firm has set 2012 as the target date, and is also expanding its sales of related conservation services. EL story.
Meanwhile, the US Navy has reduced its overall energy consumption level by 12% as of this year. Since few additional funds were allocated, the Navy is using “share-in-savings” where contractors pay for the upgrade and capital costs, then the Navy pays them back through resulting savings in its energy bills. Environmental Leader’s story details some of these arrangements.
On a comparable note, Raytheon’s Enterprise Energy Team received one of Raytheon’s 2007 Excellence in Operation and Quality award in June 2008. The team achieved Raytheon’s 2-year goal and decreased total company-wide energy consumption by 17% during 2007, vs. an adjusted 2005 baseline. The firm saved $10 million in energy costs during 2007, and avoided 104 million kWh. Since energy constitutes 90% of the firm’s greenhouse gas footprint, the firm expects to meet its greenhouse gas reduction goals a year early.
Full disclosure: DID LLC recently signed a financial agreement with Environmental Leader magazine that involves mutual investments. DID’s long-standing coverage of energy issues and their implications for military procurement will continue, and we look forward to working together with Environmental Leader on key trends and stories of interest.
Giuseppe Ceracchi: “Minerva as the Patroness of American Liberty”
In this day and age, more people associate “Minerva” with a strict teacher at a fictional wizard’s school than with Rome’s incarnation of Pallas Athena, the Greek goddess of wisdom, knowledge, and war. As “WIRED: A Different Kind of Net-Centric Warfare in Iraq” revealed, however, Minerva’s ancient incarnation remains very relevant today. “The surge” in Iraq is best known for its increase in the number of American troops, but that was actually its least significant feature. Its most significant feature was a major shift in the way the Americans fought the war, using a counterinsurgency doctrine that acted on the lessons from successes like Malaysia – and on newer insights from social scientists embedded with the American military. See also General Petraeus’ December 2008 remarks in Washington [Transcript | Slideshow].
Defense Secretary Robert Gates has previously served as the president of Texas A&M University. Under his watch, the US DoD has unveiled The Minerva Initiative to foster longer-term research that’s relevant to the national security community. Now the first awards have been made under that program…
Wells Fargo bank originally made its name in the 1850s, running secure rapid delivery services during the California gold rush. The combination of banking services and their famous red-and-gold stagecoaches proved appealing and successful. Their branches remain a familiar site in California and throughout the American West.
The firm’s latest customer also seeks to combine those 2 services, albeit from a slightly greater distance. The Netherlands currently pays about EUR 200 million to the US government for services like helicopter and fighter pilot training, and the amount is currently booked in one lump sum. If the ministry could pay these costs over time as they were incurred, the additional interest earned while holding on to their money could be significant. To do that, they need a commercial banking agreement in the USA.
Hence a pair of recent agreements. One involves the Dutch MvD and finance ministries, and the USA’s Defense Security Cooperation Agency, which processes all foreign military sales requests. The other is with Wells Fargo Bank, who is still in the business of banking and rapid delivery – with a twist. NIS News.
“When it comes to procurement, for the better part of five decades, the trend has gone toward lower numbers as technology gains have made each system more capable. In recent years, these platforms have grown ever more baroque, have become ever more costly, are taking longer to build, and are being fielded in ever-dwindling quantities. Given that resources are not unlimited, the dynamic of exchanging numbers for capability is perhaps reaching a point of diminishing returns.” (US Secretary of Defense Robert M. Gates)
Weapon projects are inherently difficult. Many are custom systems that use a wide array of new technologies, and have production runs that are incredibly small by civilian standards. Even commercial aerospace efforts tend to stumble under these pressures; as demonstrated by Airbus’ A380 super-jumbo and Boeing’s 787 Dreamliner, a pair of top-priority “bet the company” planes. Both will finish about 2 years late, and well over budget. Faced with a continuous stream of similar experiences, military and political observers have tried various flavors of military acquisition reform over the past several decades, in the USA and abroad. Britain recently began moving forward on its Smart Procurement reform plan and its Defence Industrial Strategy. On the other side of the globe, Australia’s Kinnaird Review [PDF] has led to major reforms – though results have not always followed suit. The 2008 Mortimer Review aims to take the next step down under.
At the same time, the dynamics described by SecDef Gates have created a crisis in American defense procurement that has grown big enough to jeopardize its military status. DID has covered the defense procurement spiral and tendency of the US Defense Department to begin more programs than its budget can afford, as well as growing bi-partisan legislative concern at rising weapons costs. There are strong indications that both the Air Force and Navy’s long-term procurement plans are seriously flawed, the Future Combat Systems linchpin of the Army’s long-term modernization plan is under growing budgetary attack and criticized as conceptually wrong, the Marines have run into serious performance and affordability issues with their keystone MV-22 and EFV programs, and the Coast Guard’s future Deepwater acquisition strategy has been forced into a complete reorganization. Amidst these challenges, “political engineering,” less-than-credible initial program estimates, and Congressional interfere create a continuous churn of reallocation and cancellation that raises the cost of surviving programs.
The past few years have seen efforts at organizational defense transformation in the USA – including attempts to give combatant commanders more say in the acquisition process. On the eve of a new Presidential administration, the US military is launching another acquisition reform effort, with new guidelines for weapon procurement. The Secretary of Defense, who will be staying on under a Democrat administration, added himself to the mix with an article in the Jan/Feb 2009 issue of Foreign Affairs magazine…
“Russian Arms Exports Taking Another Jump in 2008” noted the recovery of Russia’s arms industry, which faces significant rebuilding challenges but appears to be on track to surpass the $7.4 billion worth of deals signed in 2007. As “France Trying to Streamline Arms Exports” explained, a cumbersome system was dragging another key exporter down. Aviation Week’s DTI reports that the reforms are having some effect. France’s defense ministry reported that it had signed off on nearly EUR 4 billion in export contracts by the end of Q3 2008, and is on track to meet its 2008 goal of EUR 6 billion. That’s slightly above previous years, and almost double the nadir reached in 2004. Defense Minister Hervé Morin says that France’s long-term goal is to regain the share of the export market it enjoyed during the 1990s, and recover to 13% or about EUR 10 billion by 2010.
Key losses in Saudi Arabia and Morocco appear to have stung France’s bureaus into action. Morin credits some of the improved performance to MNA Yves Fromion’s approval reforms, which lengthened general approvals’ duration, discarded them for deals under EUR 150,000, and streamlined the application process. Morin says that wait times have dropped by over 60% to just 30 days on average, with 97% of applications now processed within a month and 20% of contracts given expedited treatment. The reforms also created an inter-ministerial committee to handle major deals, with 67 deals approved by the committee in the last 16 months. Morin is cautiously optimistic that contracts with Libya and Brazil can be signed before year’s end.