Navy Needs To Slow NGEN Now, Before Billions Of Dollars Are Wasted

The Department of the Navy is probably the nation’s best-managed major military organization. Under the leadership of Secretary Ray Mabus and Under Secretary Robert Work, the service has put its ship construction and aviation plans on a sound footing while making the tough choices required to stay within spending limits. But no organization is perfect, and the Navy is currently preparing to invest nearly $5 billion in a network that arguably will leave it worse off in terms of connectivity and security than it is today. That program is called the Next Generation Enterprise Network, or NGEN, and the Navy needs to heed the advice of congressional analysts to slow the program down before it wastes a huge amount of money.

NGEN is supposed to replace the Navy Marine Corps Intranet, which at 800,000 users is one of the biggest intranets in the world. The current system generally gets high grades from users and has proven to be more secure against intrusion than other military networks. But the Navy doesn’t like the way the program was structured to give an outside company responsibility for end-to-end management, so it wants to unbundle services and take over the role of system integrator. That plan is a disaster waiting to happen, as the Government Accountability Office (GAO) warned in a March report. According to the congressional agency, NGEN managers…

1. Failed to adequately analyze alternative approaches to the acquisition.

2. Failed to select an acquisition approach that minimized costs and risks.

3. Failed to formulate a reliable schedule for executing the program.

4. Failed to base program choices on a clear statement of requirements.

GAO concluded that “collectively, these weaknesses mean that [the Navy Department] does not have a sufficient basis for knowing that it is pursuing the best approach for acquiring NGEN capabilities and the programs’s cost and schedule performance is unlikely to track to estimates.” Similar concerns are echoed by the House Appropriations Defense Subcommittee in its fiscal 2012 appropriations bill. It calls on the Secretary of Defense to conduct an independent cost estimate to validate the assumptions guiding the program. Any such estimate will confirm what people in industry already know: the acquisition approach the Navy is pursuing hasn’t worked well for anyone, and certainly won’t work for the Navy.

Despite all this, the respected web-site Insidedefense.com reported on August 19 that NGEN’s program manager plans to press ahead with issuing a final “request for proposals” by mid-December, fearing that if he fails to do so that will delay transition from the current system to NGEN in spring of 2014. Issuing a request for proposals is the first step in awarding contracts and thus begins the process that will result in billions of dollars being spent on the program (the Navy has requested $1.7 billion for NGEN, about one-percent of its proposed budget, in fiscal 2012). Before pushing ahead with this ill-conceived plan in an austere fiscal environment that is almost certain to kill NGEN when its flaws become apparent, Navy leaders should ask themselves whether they really need a new multi-billion-dollar network, and if so whether the approach they are pursuing is likely to yield the desired results.