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1/15/2010
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Virginia Tech Chief Faces Outsourcing Woes

Virginia's incoming secretary of technology faces a major challenge in a sputtering outsourcing deal with Northrop Grumman.

When recently appointed Virginia secretary of technology Jim Duffey takes office with incoming governor Bob McDonnell's administration this weekend, one of the biggest challenges he'll face will be dealing with the state's troubled $2.3 billion outsourcing contract with Northrop Grumman.

Virginia is currently working to revise the struggling outsourcing contract, a 10-year effort to modernize many of Virginia's IT systems. Northrop has repeatedly failed to meet deadlines and state agencies have voiced frustrations with Northrop's performance.

Virginia recently passed a point in its contract where it could have sued Northrop Grumman for failure to complete its work or end the contract altogether, opting instead to continue working with Northrop under a corrective plan Northrop submitted last year.

Duffey recently told the Richmond Times-Dispatch that he plans to get deeply involved in the troubled Northrop deal. One of the first problems he will need to tackle may be the organizational headaches surrounding the contract. Virginia's IT management structure is multi-headed, as it includes a CIO, the Secretary of Technology, and a board of advisors called the Virginia Information Technologies Agency (VITA).

Virginia's CIO can be hired and fired by VITA, but McDonnell has said that he wants the CIO to report to the secretary of technology and be accountable to the governor. Multiple bills are on the table, which would dump the IT advisory board that oversees VITA and make the CIO a position appointed by the governor.

Before starting his own consultancy, Duffey most recently led Dell's public sector business. Earlier, he was a long-time executive at EDS, where he held positions including VP of public sector and VP of global supply chain management. In those positions and others, he managed deals with EDS customers -- including Portugal's largest outsourcing contract -- and relationships with EDS' own vendors, giving him long experience in outsourcing.

Duffey has also served as vice chair of the very active Northern Virginia Technology Council and serves on the boards of a number of philanthropic and community organizations.

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