Northrop Grumman Moves Litton Integration Forward

Northrop Grumman Corp. is preparing an all-out assault on government systems integration contracts. The company is eyeing opportunities with the Department of Defense, Federal Aviation Administration and state and local government agencies.


The Los Angeles defense giant, with estimated 2001 revenue of $15 billion, is close to unveiling its new organizational structure, based on completing the integration of Litton Industries Inc., which it purchased earlier this year, according to Steve Carrier, vice president of business development.


Northrop Grumman's information technology sector is comprised of its heritage IT business, Logicon Inc., plus the PRC and TASC units it picked up from Litton. The total IT business is a $4 billion a year enterprise.

"We're a fourth of the company now. ... We were just seven percent several years ago," Carrier said.


With the acquisition of Litton, Northrop Grumman is now a full-service systems integrator, from lower-end operations and maintenance work to developing very sophisticated IT systems, Carrier said.

The company sees opportunities in seat management and health and human resources, especially at the state and local level, he said. Another opportunity lies with the Federal Aviation Administration, Carrier said.

"With PRC and Sterling Federal Systems (an earlier acquisition), we're well-positioned there," he said. "Revenues are $80 million; we're looking to grow that business to $200 million over the next five years."


Carrier said the IT group's biggest challenge is how to act like a $4 billion company rather than several $500 million companies. Northrop Grumman has completed a realignment of its management structure, he said, to prepare for the reorganization, which will take place Jan. 1, 2002.


By virtue of its extensive "black" contracts with the intelligence community, TASC will remain a stand-alone division of the new IT sector, Carrier said.


Litton PRC and the pre-acquisition Logicon were pretty similar in skill sets and customer bases, Carrier said, but the company expects to keep all the front-line employees.

"In our business, people are revenue," Carrier said. "We have a lot of openings."