We last looked at Leidos in late 2022, and captured some of the company’s noteworthy wins, investments in capabilities, and critical M&A activity. This blog will focus first and foremost on the company’s reorganization announcement to realign its operating groups and restructure its corporate leadership effective January 1, 2024.
These changes are part of the company’s Leidos Next corporate strategy to allow faster decision-making and more tightly align the business around key technology discriminators – but what’s the real meat and potatoes of this change? The most immediate change centers on the overall business organization. Leidos plans to reorganize as follows:
As the graphic suggests, current Defense Group President, Gerry Fasano, was promoted to become Chief Growth Officer, focusing on strategy, marketing, sales, government affairs, and communications across Leidos, and will be replaced by Cindy Gruensfelder, a 35-year Boeing veteran.
Roy Stevens, president of Leidos’ Intelligence Group, will likely maintain a similar role as the new lead for the National Security Sector. Liz Porter will transition from president of the Health Gorup to the Health and Civil Sector Lead. Steve Hull, executive vice president and operations manager for the enterprise and cyber solutions portfolio will now lead the Digital Modernization Sector and Vicki Schmanske, executive vice president of Leidos’ corporate operations will oversee the Commercial and International Sector.
Astute readers will note that many of these executives are long-time Leidos leaders who are (in part) being shuffled around to enable this new strategy.
Recent Wins
Along with Leidos’ significant reorganization, the company has made headlines for noteworthy contract wins:
U.S. Department of the Army, Common Hardware Systems 6th Generation (CHS-6) – In September 2023, Leidos was awarded the 10-year, $7.9 billion CHS-6 contract to provide the U.S. Army with rapid procurement of IT hardware solutions. Leidos will leverage its Leidos Intelligence Logistics Platform to help enable better-informed, timely decision-making throughout the Command, Control, Communications, Computers, Cyber, Intelligence, Surveillance and Reconnaissance (C5ISR) and mission IT lifecycle in support of more than 120 Army, DoD, and federal government offices and agencies. This was a takeaway from General Dynamics, who has held every iteration of this contract since 1995 and demonstrates strong qualifications in supply chain management and logistics work Leidos has not traditionally been known for.
U.S. Department of Homeland Security (DHS), Homeland Enterprise Information Technology Secure Services and Support (HEITS) – In August 2023, Leidos was awarded the seven-year, $918 million Homeland Enterprise Information Technology Secure Services and Support Alliant 2 task order. This is a follow-on to the SENS3 contract Leidos held and allows the company to continue its role as the lead technology integrator for a pair of Homeland Security Department IT networks housing classified information. DHS uses its Homeland Secure Data Network (HSDN) and Classified-Local Area Network (C-LAN) to facilitate the secured sharing of classified information across communities of interest. According to a protest related to Leidos’ Defense Enclave Services (DES) IDIQ, Leidos’ most recent CPARS for the SENS3 contract included exceptional ratings for quality, schedule, cost control and management.
U.S. Department of Defense (DoD), Joint Staff (JS) J6 Joint Assessment Division (JAD), Combined Joint All-Domain Command and Control (CJADC2) – In September 2023, Leidos was awarded a 5.5-year, $74 million contract to provide combined joint all-domain command and control (CJADC2) analysis and support to the DoD Joint Staff J6 Joint Assessment Division (JAD). Leidos provides analytical, engineering and deployable services to support JAD’s operational analysis, including demonstration, experimentation and assessment of both emerging and fielded C2 information systems and procedures.
U.S. Department of the Navy, U.S. Marine Corps, Marine Corps System Command (MARCORSYSCOM), Defense Radar Systems Development– In November 2023, Leidos was awarded a two-year, $32 million contract through the Consortium Management Group (CMG) to provide defense radar systems development for four Medium Range Air Defense Radar (MRADR) prototype systems. Led by the Dynetics team, work will be based off expertise from previous sensor development programs and feedback from live demonstrations. Dynetics previously developed the Marine Expeditionary Long Range Persistent Sensor (MELPS) assets through the Office of Naval Research Multi-domain Radar in Contested Environments (MuDRaCE) program, which was managed by Leidos’ Innovation Center (LInC).
U.S. Department of Defense (DoD), Defense Health Agency (DHA), Digital First– In October 2023, Leidos was awarded the two-year, $180 million Digital First task order to provide the DHA with new virtual health capabilities for providers and patients. Under the contract, the Leidos Partnership for Defense Health (LPDH) will replace the MHS Video Connect solution with Amwell’s Converge™ platform. Digital First will bring new capabilities and enablement to MHS GENESIS and provide the necessary adoptions, support change management and work processes to deliver targeted outcomes to MHS GENESIS users. The new Converge platform includes self-guided wellness and behavioral health support and enables seamless escalation to on-demand provider engagement to obtain medical care and advice from any location.
The FedSavvy Takeaways
- Leidos’ reorganization is a move to better align with customer priorities and especially shows Leidos Defense’s interest in making more products, as demonstrated through the appointment of Cindy Gruensfelder and more organizational structure to make products vs. pure customer and service alignment.
- This point is further evidenced through Leidos’ marketing of the Defense Radar Systems Development contract for MARCORSYSCOM, which may not have a large monetary value but signals strategic significance.
- The creation of the Digital Modernization business unit establishes a sector that was once simply a cross-domain capability, showing Leidos’ ambition to expand its expertise in areas such as AI, cyber, and IT operations…yet more focus on building technology vs. a service-centric business.
- Leidos’ recent noteworthy wins show strengths in supply chain management and logistics, complex IT integration, virtual health and insight into JADC2.
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