WT Business Beat

By Nick Wakeman

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Deepwater's lesson

The Coast Guard's decision to take back control of Deepwater, its inititiave to modernize its fleet and related infrastructure including communication systems, is more than a warning shot across the bow of prime contractors.

It's a direct hit.

As this morning's Washington Post reported the project has been plagued by delays and cost overruns. With heightened scrutiny from Congress, Deepwater was a project with a big target on its back.

Bearing an equal share of the criticism has been Lockheed Martin Corp. and Nothrop Grumman Corp., who shared prime contracting duties through a consortium they formed to manage the initiative.

Much of the criticism centers on a breakdown of the lead systems integrator role. That's the troubling part of all this. Isn't being a lead systems integrator what companies like Lockheed and Northrop do best?

I know there are lots of good reasons for the problems with Deepwater, but every prime contractor should be a little afraid today.

Posted by Nick Wakeman on Apr 17, 2007 at 7:22 PM

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