May the best team win

Peter von Jess, USFalcon Inc.

Courtesy photo

USFalcon Inc. President and CEO Peter von Jess learned his business skills working for IT giants in the government defense contracting industry.

Von Jess spent 15 years honing his program management and business development skills while working for GTE Government Systems Corp., now part of General Dynamics Corp., and later at Computer Sciences Corp. He credits that experience with the success of Lowell, Mass.-based USFalcon, which von Jess has led since 2003, when he took over from his sister, who founded the company in 1999.

"I learned my trade the old-fashioned way," he said.

USFalcon will need that experience as it enters the heated competition for contracts under the Army's 10-year, $19.3 billion Strategic Services Sourcing program. The small, veteran-owned company was selected as one of three small companies, together with four large corporations, that will compete for task orders in full and open competitions.

The program will provide engineering, logistics and business operations support services for Army command, control, communication, computer, intelligence, surveillance and reconnaissance (C4ISR) systems. The Army's Communications-Electronics Life Cycle Management Command (C-E LCMC) at Fort Monmouth, N.J., where most of the work will be performed, awarded the contract.

Joining USFalcon as small-business prime contractors are New Jersey companies Sensor Technologies Inc. of Red Bank and ViaTech Inc. of Eatontown. Von Jess said each of the three companies should be proud of what they have accomplished so far.

"For any small company to have won this, it's beyond a kudo ? it's a significant emotional event," he said.

David and Goliath

The three small companies will vie with Booz Allen Hamilton Inc., McLean, Va.; CACI International Inc., Arlington, Va.; CSC and Lockheed Martin Corp.

But the small companies can expect their fair share of opportunities, said Kevin Loesch, chief of the Army's C-E LCMC Office of Small Business Programs. Loesch, who helped craft the S-3 contract, said the three small businesses are expected to play a key role in developing emerging technologies for C4ISR operations.

"Technology and innovation are going to come out of the small-business community, and not necessarily from the corporate giants in the defense industry," Loesch said. "We understand that they play a very important role in support of the mission here at Fort Monmouth."

ViaTech has been working at Fort Monmouth since 2000, when it won the Business Functional Area and Systems and Telecommunications Management Support Services contract, which was worth about $30 million to the company. That pact expired this past year, and the re-compete was rolled into the S-3 contract, said Lancy Burns, ViaTech vice president and chief operating officer.

Burns is not worried about competing against the large IT companies for that work. But he said there is some uncertainty about competing elsewhere in the full and open market. ViaTech will be thrown into that fray as it outgrows its small-business status as a 125-person company with $20 million in annual revenue.

"That's the price you pay for being successful," he said. "But we've positioned ourselves to compete in the full and open market, and we are not afraid to compete with the large businesses."

Burns said the company should triple its revenue over the next two years through S-3 opportunities alone. The company also will look to take advantage of the increased visibility the contract will afford them to go after opportunities in other government agencies, he said.

Von Jess estimated that USFalcon, which had $10 million in fiscal 2005 revenue, will hit $30 million in revenue in fiscal 2006 and likely will be at $60 million by the end of fiscal 2007.

"If our large teammates bring their work to that contract, like we expect them to, we may beat that number a lot sooner than that," von Jess said. "I think that's a conservative view."

Well adjusted

Unlike USFalcon and ViaTech, Sensor Technologies does not carry any Small Business Administration designations, and has already adjusted to competition on the open market by working mostly as a subcontractor, said company President and CEO Michael Gualario. Sensor Technologies has about $13 million in fiscal 2005 revenue, and anticipates growth of at least 30 percent this year, he said.

The company has work supporting the Homeland Security and Justice departments, along with several agencies that Gualario declined to name. The company helped develop the Army's Advanced Monitoring and Display System, which is deployed throughout Iraq and Afghanistan, using integrated map and sensor applications to give battlefield commanders improved situational awareness.

Sensor Technologies will continue to focus on engineering and integration, while letting its partners go after the logistics and business services work under the S-3 contract, Gualario said. Sensor's partners include Science Applications International Corp., AT&T Inc. and Unisys Corp. among others.

USFalcon counts BAE Systems Applied Technologies Inc. and SI International Inc. among its more than 40 teammates, about 70 percent of which are other small businesses.

ViaTech has corporate giants such as General Dynamics, L-3 Communications Inc. and CACI as subcontractors on its team of 36 companies.

With the support of both large and small companies behind them, the three small-business prime contractors should have no problem winning their fair share of work, according to government and industry officials. Still, the Army has protection built in to the S-3 contract to prevent the small companies from being squeezed out, Loesch said.

If, after at least one year, the small companies are not getting at least 18 percent of the total dollar value of awards, the Army can limit competitions until the small businesses climb to more than 18 percent of the dollars awarded, he said.

The Communications-Electronics Life Cycle Management Command at Fort Monmouth plans to relocate to the Aberdeen Proving Ground, Md., but none of the small companies is concerned about making the move. All three either have or are planning to move some of their staff to Maryland.

USFalcon's von Jess said the timing of the move also makes it less of an issue to the small companies supporting the S-3 contract. Nothing is moving to Aberdeen until a facilities are constructed at Fort Lee, Va., the site to which Aberdeen operations will move, he said. "It'll be five years before it takes place," he said.

Staff Writer Ethan Butterfield can be reached at ebutterfield@postnewsweektech.com.

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