The Navy and Marine Corps’ plan for their next generation intranet faces cost overruns and delays and are unlikely to meet the April 2014 timeframe for transitioning to the new system, the Government Accountability Office (GAO) said this week.
The Navy issued the final request for proposals for the Next Generation Enterprise Network (NGEN) in May, two years behind the original schedule and months later than revised plans to do so by the end of 2011. The Navy is now not expected to announce the winner of the industry competition for NGEN until early next year.
The delays will make it difficult to transition from the Navy Marine Corps Intranet (NMCI) to NGEN by April 2014, and will force the service to reissue a continuity of services contract that will add to costs, the GAO auditors determined.
“The program faces an increased probability that transition from its existing system to NGEN will face further delays and cost overruns,” GAO said in the report (GAO-12-956) released recently.
The GAO also faulted the Navy for not adequately exploring alternatives to acquire the technology represented in NGEN, despite revisions earlier this year to its approach. That adds more risk to the program, GAO said.
“GAO remains concerned with the analysis measuring NGEN cost effectiveness and ( the Department of the Navy) does not know whether its revised approach for acquiring NGEN is the most cost effective,” the report said.
In a written response, the Defense Department said the Space and Naval Warfare Systems Command’s (SPAWAR) program office for NGEN has already taken steps to bolster risk management and mitigation.
“The NGEN program office will continue the integration and acquisition and operations risk management efforts to promote visibility and communication and build a more risk-aware culture across the program,” the Pentagon said.
Hewlett-Packard [HP] is the prime contractor for NMCI. The incumbent has partnered with Northrop Grumman [NOC], IBM [IBM], AT&T [T] and Lockheed Martin [LMT] to submit an NGEN bid. A second team has been formed by Harris Corp. [HRS] and Computer Sciences Corp. [CSC] and includes General Dynamics [GD] and Verizon Communications [VZ].
The two contracts, one for enterprise services and another for transport services, could reach a total value of $5.3 billion over the next five years. GAO said the total program could cost as much as $38 billion through 2024. The Navy could award both contracts to a single team, or one to each.
NGEN is intended to provide secure, net-centric data and services to 800,000 Navy and Marine Corps personnel and connect 400,000 workstations. NMCI already represents the largest intranet in the U.S. government and began in 2000 under a contract with Electronic Data Systems, which HP acquired in 2008.