Thursday, November 27, 2014

The INSIDER - November 26, 2014

Posted on InsideDefense.com: November 26, 2014
Happy Turkey.

A couple stories posted this pre-Thanksgiving morning:

Leidos Could Clinch Key Deal For NATO Missile-Shield Work

U.S. government-services contractor Leidos is in final negotiations with NATO over a deal to help build the alliance's ballistic missile defense shield, according to industry sources.

The Reston, VA-based company won the race for a systems engineering and integration contract initially valued at roughly $90 million by underbidding the competition, these sources said. The deal would enable Leidos to maintain a solid foothold for the next half-decade or so in NATO ballistic missile defense as the go-to firm for the development of a test bed and interfaces between individual country systems.

The NATO Communications and Information Agency, which invited bids in January, had yet to announce the selection of Leidos' offer. An official reached by phone at the headquarters in The Hague, Netherlands, declined to comment on Nov. 25. Leidos officials were "unable to confirm or comment at this point," a company spokeswoman wrote in a statement.

G4S Government Solutions Becomes Centerra Group In New Deal

Following its sale to private-equity firm Alvarez & Marsal Capital Partners this week, security contractor G4S Government Solutions will be renamed Centerra Group and begin seeking acquisitions to bolster its size and scope of work.

Centerra, with 8,800 employees, is the latest company to reshape to adapt to a tougher market. About one-third of the company's $500 million in annual sales is in military base operations, including 1,500 employees at Naval Support Facility Diego Garcia.

The contractor, like many others, is seeing growing pressure on both the amount of work available and on price. In Iraq, for instance, Centerra provided support at 32 different fire stations for a decade through a Defense Department project; about 3,300 employees worked on the project over the 10 years.

More defense business news from yesterday:

General Dynamics Consolidation To Be Completed By End Of Year

By the end of the year, General Dynamics' advanced information systems and C4 systems units will be merged into a new business unit that its chief says will be better positioned for a changing market.

The two units are part of General Dynamics' information systems and technology business, the unit most vulnerable so far to government spending cuts. In early 2013, General Dynamics devalued the business by $2 billion because of reduced government demand.

General Dynamics announced the merger in September; by Jan. 1, the newly combined organization, with about 13,000 employees, will be in place.

Strategic Analysis.

The DEPSECDEF is looking to "reinvigorate" an internal Pentagon analysis process:

Work Grabs Reins Of Analysis Effort Pivotal To Strategy, Budget Decisions

The Pentagon's No. 2 official, acting on the recommendation of the service vice chiefs, is asserting a new leadership role over an internal Defense Department analysis process that forms a linchpin for nearly all high-level deliberations on defense strategy, weapon system programming and budget matters, force sizing and capability development.

In a Nov. 14 memo, Deputy Defense Secretary Robert Work announced plans to "reinvigorate" the Support for Strategic Analysis (SSA) process -- previously delegated to a trio of senior officials -- and set an agenda in an effort to produce more uniform information critical to leadership assessments of defense strategy as well as planning, programming, and budget-execution matters.

Work, in his memo to Pentagon leaders, wrote that he intends to use this strategic analysis process to drive DOD to "explicitly consider innovative approaches" to everything from potential threats to alternative force structures based on emerging capabilities -- and that this work is part of the broader defense innovation initiative to advance U.S. military technological superiority.

Document: Work Memo On The SSA Process (FOUO)

Commercial Item Pricing.

A sneak peek at a couple stories on the front page of this week's Inside the Pentagon:

Assad: DOD Seeks To Expand Support Center For Commercial Item Pricing

The Defense Department wants to expand by four additional sites a center of excellence within the Defense Contract Management Agency to help contracting officers determine reasonable prices for commercial items following a successful first year of the pilot program, according to officials overseeing the effort.

DOD pricing czar Shay Assad, in a Nov. 20 interview with Inside the Pentagon, said the department seeks to expand the center of excellence for commercial item pricing from its current pilot location in St. Petersburg, FL, to Dallas, Seattle, Boston and Chicago in the next year-and-a-half. These locations are convenient to both industry and the Pentagon's major buying commands, Assad said.

Defense officials want to brief acquisition chief Frank Kendall and DCMA Director Lt. Gen. Wendy Masiello within the next few months on the results of the pilot program, Assad said.

Haney: STRATCOM's New Strategy Will Better Handle Global Threats

While the Islamic State of Iraq and the Levant has been building a global network, for the past two years U.S. Strategic Command has been switching from a geographic to an adversarial-based strategy that is better suited to handle worldwide threats, according to the head of the command and analysts following the issue.

"Future conflicts will not be limited by conventional constraints characteristic of 20th century warfare or by geographic boundaries," STRATCOM Commander Adm. Cecil Haney stated in an email provided to Inside the Pentagon by a spokesman.

According to Haney, STRATCOM has changed the structure of its overall planning from a strictly functional approach to one that aligns more closely with those of the geographic combatant commands. The new strategy ensures that plans between the functional command and the geographic commands are synchronized, so that if a crisis occurs the regional and global issues will have already been addressed in planning.

Happy Thanksgiving to all our readers. The next INSIDER will be issued on Monday, Dec. 1.

-- John Liang

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