General Atomics Aeronautical Systems Inc (GA-ASI) has grown very quickly into a powerful force within the US defense industry. Their stable of products based on the Predator/Reaper/Sky Warrior family have dominated almost every competition they've entered.
Almost, but not all.
The US Navy passed over the Lockheed Martin/GA-ASI team offering the Mariner version of the Predator B for the Broad Area Maritime Surveillance (BAMS) contract, instead handing the program to the Northrop Grumman RQ-4 Global Hawk.
And now we know why: GA-ASI has a huge customer relations problem with the US Department of Defense, according to a decision statement released today by the US Government Accountability Office (GAO). The GAO became involved because Lockheed protested the BAMS decision.
It turns out that the poor past performance record of GA-ASI, and, to a lesser extent, Lockheed Martin, largely offset a 33% cost advantage compared to the Northrop bid.
The Lockheed/GA-ASI team's record on previous contracts made them a "high risk, giving rise to substantial doubt that the team could perform the proposed contract effort," the GAO says. By contrast, Northrop had stumbled on past programs, but had also "demonstrated systemic improvement" to receive a moderate risk rating.
How bad is GA-ASI's past performance, in particular? Well, the GAO answers that question in vivid detail. The decision quotes most of a letter written by US Army official who is buying the GA-ASI MQ-1C Sky Warrior. Here's what it says:
Almost, but not all.
The US Navy passed over the Lockheed Martin/GA-ASI team offering the Mariner version of the Predator B for the Broad Area Maritime Surveillance (BAMS) contract, instead handing the program to the Northrop Grumman RQ-4 Global Hawk.
And now we know why: GA-ASI has a huge customer relations problem with the US Department of Defense, according to a decision statement released today by the US Government Accountability Office (GAO). The GAO became involved because Lockheed protested the BAMS decision.
It turns out that the poor past performance record of GA-ASI, and, to a lesser extent, Lockheed Martin, largely offset a 33% cost advantage compared to the Northrop bid.
The Lockheed/GA-ASI team's record on previous contracts made them a "high risk, giving rise to substantial doubt that the team could perform the proposed contract effort," the GAO says. By contrast, Northrop had stumbled on past programs, but had also "demonstrated systemic improvement" to receive a moderate risk rating.
How bad is GA-ASI's past performance, in particular? Well, the GAO answers that question in vivid detail. The decision quotes most of a letter written by US Army official who is buying the GA-ASI MQ-1C Sky Warrior. Here's what it says:
[GA-ASI] continues to struggle as the systems integrator.
[GA-ASI] has resisted hiring adequate engineering and technical staff to address all of the tasks they are currently contracted to perform.
The common theme within the delivery/schedule problems appears to relate back to the acceptance of contractual commitments which are physically beyond production capacity.
A major contributor is [that GA-ASI's] senior management continues to obligate the company without fully reviewing and understanding the current workload and commitments.
Management task saturation coupled with [GA-ASI's] highly centralized management structure both contribute towards the delays with the integration testing and coordination efforts.
The engineering staff appears to be technically [competent], but in most cases are not empowered at the appropriate levels to make the necessary decisions to push the task forward in a timely manner to maintain schedule.
[GA-ASI] has made limited corrective actions and usually not without Government PMO insistence.
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