Eye on the States: Homeland security business is closer, but still far away

Thomas Davies

The first reaction of many companies to 9/11 was to reorganize around the emerging opportunity. One lesson learned is that moving boxes around organization charts is a whole lot easier than designing, building and delivering new homeland security solutions.

It wasn't until companies decided which division inside their organizations -- federal, state or local -- should take the lead that the real work got started.

It also became painfully obvious for most companies that they didn't know much about homeland security in state and local government. They may have been calling on state and local governments for years, if not decades, but emergency response was never on their radar.

They soon discovered that, lacking first-hand knowledge of the customers and their needs, it was impossible to develop a meaningful business plan for this market.

Over time, companies realized that the state and local homeland security opportunity was not going to form quickly. Many had expected -- or hoped -- the market would form with a big bang and a huge outpouring of federal funding.

Chalk it up to a very painful civics lesson on the harsh realities of federalism and the difference between governments that can operate in a deficit (federal) and those that must balance their budget (everyone else).

A look back at the past three years shows that, though it's been tough at times, some companies have made progress. Earlier this year, Delaware chose Northrop Grumman Corp. to help deliver a disease surveillance system similar to one the company delivered in Montana.

In both projects, Northrop Grumman capitalized on its work with the federal Centers for Disease Control. And on top of these wins, the company now has reach in all 50 states with the award of the highly strategic task order to design, operate and maintain the Homeland Security Department's nationwide secure network.

It's taken much time and resources over the past few years, but other companies have been able to bring to market new homeland security solutions.

A few months ago, Unisys Corp. launched an innovative, integrated justice information sharing solution that allows for real-time exchange of information. The solution lets agencies control their data repositories while it brokers communications across federal, state and local governments.

EDS Corp. and Anaheim, Calif., recently announced what they claim is a first-of-its-kind virtual command center. By gathering data from utility, fire, police, traffic, licensing and emergency response organizations from around the city, it now can estimate what is unfolding across the area.

The cornerstone to this: building on the city's technology networks and data systems.

The technology industry has not made as much progress in homeland security for state and local organizations as many would have liked. But those companies that stuck with it have begun reaping the rewards.

They built upon what they had, looked for receptive customers and began putting the building blocks in place. They may not have booked as many orders as they initially had expected, but those that adapted are ahead and well-positioned to respond to future homeland security opportunities.

Thomas Davies is senior vice president at Current Analysis Inc. in Sterling, Va. His e-mail address is tdavies@currentanalysis.com.

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