Concerns swirl around transparency of Navy network contract

A Navy official on Wednesday revealed more details about the schedule for awarding a contract to replace the service's massive enterprise network, but concerns about the transparency of the procurement process linger.

Comment on this article in The Forum.The service still is seeking industry comment on its segmented approach to implementing the system, but expects to award the contracts in 2010, said Capt. Tim Holland, program manager for the Next-Generation Enterprise Network.

The program will tie shore-based networks to those aboard ships and is designed to replace the $10 billion Navy Marine Corps Intranet, which was awarded to EDS in 2000. Unlike its predecessor, NGEN will be controlled largely by the government, Holland said.

To facilitate a faster transition, the Navy has created a program office that will bring four separate functions under one roof: acquisitions, policy, budgeting and day-to-day operations. "We're bringing into a single office all of the pieces simply because our networks across the Navy enterprise are fairly disparate and in a number of different hands," Holland said.

One benefit of the new structure is it will help keep high-ranking officials informed about progress on NGEN.

"I'm briefing senior acquisition officials as well as others within the department," Holland said. "Frankly, any acquisition of the magnitude of NGEN and NMCI is going to have visibility at the highest levels."

Another step the program office has taken to speed up the process is to break the NGEN contract into eight different groups of services. The first is made up of functions that will be retained by the government: program management; contract management; technical authority; and the actual operation of the network, which marks a departure from the contractor-controlled NMCI. The program also will use government engineers to support in-service capabilities.

Six other types of services are slated to be outsourced: data storage, help desk services, networking services (both wide and local area), managing applications, security, and information assurance and providing service to end users for both desktops and mobile devices. The Navy is expected to use a contractor for coordinating the outsourced services.

The Navy continues to face criticism about its lack of communication and transparency regarding NGEN plans, however.

"I made comments in September when we had a large meeting," said Alan Chvotkin, executive vice president and counsel for the Professional Services Council, a national trade association. "The frustration about the lack of communication was palpable."

Chvotkin noted that the Navy later held an industry day, but used just 45 minutes of the four hours that had been set aside. The service took only written questions, he said, but has not provided written answers. "Their view is that they're talking to industry because they're having these sessions," he said. "But the fact is there is little substantive information coming out that informs industry about the requirements or strategy of this procurement."

Holland said the Navy has received 43 white papers from industry since announcing the structure of the NGEN program office and the responses have largely agreed with the service's approach to breaking down and packaging services. The Navy has not yet decided how to award the contracts, but expects to release within the next week a draft of service specifications that will provide a better technical description of the needs of each grouping and details on what prospective vendors will have to design.

"I understand the secretary of the Navy hasn't adopted a procurement strategy for NGEN, so there's not a whole lot they can say," Chvotkin said. "It's possible they are doing a tap dance, because they don't have anything more substantive they can say with no decisions made. But even that fact would be helpful for industry to know."

Despite a critical statement from the Senate and House Armed Services committees that was associated with the fiscal 2009 Defense authorization bill signed by President Bush on Tuesday, Holland said he was not aware of any concerns from Congress about the program's transparency. His office has been in regular contact with the Hill, he said, and he personally has met with senior leaders to discuss the project. Holland called the discussions "positive" and said his office has provided "huge amounts of information to congressional staff."

Holland plans to conduct two more industry days, one in December and the second in the spring. He said the Navy plans to issue requests for proposals in the spring of 2008 and have the contracts awarded and the transition under way in 2010.

But Chvotkin cautioned that the 2010 deadline is not that far away and presents a real problem for the Navy unless it has plans to extend NMCI. "Two years is not a long time in the life cycle of Navy procurement," he said.

Congress already has said, "no more lead systems integrator contracts and no more NMCI," which means "they can't simply extend the contract while they sort this out," he added.