Condor Federal Gets Boost From Navy Win

Condor Federal Gets Boost From Navy Win

George Blick

By Marianne Dunn, Staff Writer

Condor Government Solutions Division, Falls Church, Va., has won a million-dollar software analysis project from the Naval Aviation Systems Command that company officials hope will lead to an ongoing relationship with the Navy.

The contract, awarded Aug. 4 under the General Services Administration schedule, calls for Condor to conduct a gap analysis to identify what commercial software the command should purchase for enterprise resource planning, said George Blick, division vice president.

Under the contract, Condor will analyze many commercial software packages that handle accounting, payroll, human resources, acquisitions, procurement and operations, to determine how closely they meet the requirements of the command.

"Very little ERP implementation work has been done in the public sector on the scale that Navair and the Navy are planning," said Blick. "Standard software systems that fulfill public-sector requirements may not exist."

The federal division, like its parent company, Annapolis, Md.-based Condor Technology Solutions Inc., provides consulting, systems support solutions and e-commerce capabilities to public and private clients.

In 1998, the company's revenue was $169 million. Projected revenue for 1999 is around $200 million, according to Blick. The company has 1,510 employees in 31 offices around the world. Sixty of those employees work in the federal division in Northern Virginia.

Approximately 75 percent of the company's business is concentrated in the private sector. The rest is generated by the federal division. In 1999, the company pulled in $125 million from the commercial business sector and $40 million from the federal government.

The FBI and Department of Veterans Affairs are the major sources of business for the federal division. On June 14, Veterans Affairs awarded Condor a five-year, $20 million contract to provide an outsourced customer relationship management solution.

On Feb. 5, 1998, Condor had an initial public offering and the stock closed at $13 per share. In early August, the stock price dipped below $2.50, but it has climbed recently, closing at almost $3 Sept. 1.

The Government Solutions Division was purchased by Condor Technology Solutions in February 1998. Previously, it was called Federal Computer Corp.

Bennett Nottman, an analyst with First Union Capital Markets in Richmond, Va., said that the company was adversely affected by a declining demand for ERP services in the private sector.

"They had a number of very strong quarters before the last quarter, when they were hit hard by a slowdown in the enterprise resource planning market," he said. "What they need in order to get themselves back on their feet is a rebound in the ERP market."

Input, a market research firm in Vienna, Va., projects the federal market demand for vendor-furnished information systems and services will jump from $25.2 billion in fiscal year 1998 to $33.8 billion in fiscal year 2003 at a compound annual growth rate of 6.1 percent.

Condor recruited George Mason University, Fairfax, Va., as a subcontractor for the Navair contract. The university is home to the Policy Analysis Center, a joint program of the School of Engineering and the Institute of Public Policy, and its offshoot, the Enterprise Resource Planning Laboratory, which began testing ERP solutions for the Defense Department in 1993.

The contract team for the Navair project, which so far consists of two representatives from the Policy Analysis Center and three Condor employees, is now at the Naval Air Station in Patuxent River, Md.

Blick said Condor partnered with the university because Thomas Gulledge, founder of the center and professor of public policy and engineering at the institute, "is a brilliant man" who understands ERP technology, the public sector and how the two can come together.

The lab was founded in February 1995 to test ERP solutions when deans from the school of engineering and the institute were inundated with questions about enterprise research planning, said Gulledge.

"It was an obvious area for us to focus on to better serve our customers, which are the local business community and public sector organizations," said Gulledge.

Supplying the lab with software are Great Plains of Fargo, N.D., Oracle Corp. of Redwood Shores, Calif., and SAP AG of Waldorf, Germany. Students learn how to use the software and work with Gulledge and Rainer Sommer, associate research professor and assistant director, to determine which packages work together and if the solutions can be applied to the public sector.

"ERP has been highly successful in the private sector," said Blick. "But the DoD and the public sector are completely different from [the private sector] from a business point of view."

The private sector has been more receptive than the public sector to implementing ERP software that weaves together accounting, human resources, procurement, operations and payroll processes.

But Sommer said that calls from public sector officials indicate that the government is gaining interest.

"The word ERP has come up as a sort of a blip on the radar screen for the federal government. It has always been there in the private sector, but it seems all of a sudden the government realizes the benefits of the systems," Sommer said.

"We have to define our role very carefully," said Gulledge. "It has to be an advisory role, and it has to have a research and development look to it."

Condor will assign GMU researchers specialized tasks that have to do with review, advice and planning, said Gulledge.

Blick said the contract team's findings would be presented to Navy officials in six months. The team's report will cover which commercial software functions would be applicable to the public sector and what functions need to be created for the agency to stay in compliance with federal mandates, such as fair and open competition and best value awards.

Based on that analysis, Blick said Navair will issue an request for proposals to implement the software across the entire command. Neither GMU nor Condor will pursue the contract, but Blick said his company hopes to play a role in monitoring the software.

A spokeswoman from the Naval Aviation Systems Command's Enterprise Solution Program Office declined to comment.

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