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: Commonwealth, Northrop Grumman Reach Agreement on Compensation for Summer 2010 Computer OutageMay 20, 2011 (M2 PRESSWIRE via COMTEX) -- Virginia Information Technologies Agency RICHMOND -- Northrop Grumman will provide $4.748 million in financial compensation and operational improvements to the Commonwealth for losses from the computer outage last August that impacted several state agencies, including the Department of Motor Vehicles. In addition, Northrop Grumman has agreed to implement a corrective action plan that addresses the findings and recommendations in the independent third-party audit report. Speaking about the agreement, Governor Bob McDonnell remarked, "We are committed to holding all state contractors accountable for the performance of their duties on behalf of the Commonwealth and its citizens. Northrop Grumman will pay the full costs incurred by the state during last year's outage. In addition, the company will pay to put in place new procedures and systems to ensure, to the greatest extent possible, that a similar outage does not occur in the future. The disruption of our state computer systems resulted in an unprecedented bipartisan effort between the legislative and executive branch to investigate the circumstances surrounding the outage and to hold Northrop Grumman accountable for the outage and to provide a path for obtaining compensation for the state's expenses. This agreement brings closure to this incident, and provides the Commonwealth with an improved information technology infrastructure that will reliably support Virginia's citizens and agencies in the years ahead." Secretary of Technology Jim Duffey, who negotiated with Northrop Grumman on behalf of the Commonwealth, said the financial package being provided by Northrop Grumman includes monthly invoice credits over the next 24 months totaling $1.908 million. This represents the entire amount of direct costs incurred by the Commonwealth as a result of the disruption. Northrop Grumman also will expend $2.09 million making operational improvements to database backup, storage systems, system monitoring, database monitoring, network monitoring and capacity management. Northrop Grumman also will implement and pay for "point in time" or "snap/clone" technology to protect the data held by the state, and will address additional recommendations made in the Agilysys review of the outage. These remedial actions are valued at approximately $750,000. In addition, the company previously paid $250,000 for the cost of the independent third-party audit performed by Agilysys. This brings the company's total expenses to slightly under $5 million. "I am satisfied that Northrop Grumman has been held accountable and that the Commonwealth has been made whole," Secretary Duffey said. "This compensation package will benefit all agencies impacted by the outage and enhance the state's information technology infrastructure." Virginia Chief Information Officer Sam Nixon added, "I believe that the risks and problems identified in the audit have been satisfactorily addressed. Moving forward, I am confident that the improvements will make our infrastructure more reliable and resilient." On August 25, 2010, the failure of a key hardware component owned and operated by Northrop Grumman at the state data center -- and subsequent delays in restoring operations -- caused a significant impact to the operation of several state agencies. These delays had an adverse effect on the citizens of the Commonwealth and resulted in unexpected expense to state agencies. Outages related to the disruption impacted 13 percent of the Commonwealth's executive branch file servers and 26 of 89 executive branch agencies, including, most visibly, the Virginia Department of Motor Vehicles. Of those 26 agencies, 16 reported a financial impact due to the outage. In the wake of the disruption, Governor McDonnell ordered that immediate and comprehensive recovery steps be taken. First he directed Department of Motor Vehicle offices in every region of the state to hold unprecedented weekend hours in order to accommodate Virginians inconvenienced by the outages. Secondly, he called for a comprehensive external audit of the situation, to be overseen jointly by the executive and legislative branches and paid for by Northrop Grumman. Working in conjunction with the Joint Legislative Audit and Review Commission (JLARC), the McDonnell Administration, represented by Secretary Duffey, chose Agilysys, a provider of information technology services to Fortune 50, 500 and mid-tier customers, to conduct the audit. The major findings of the Agilysys review included: The outage resulted from the failure of a key data storage system (EMC DMX-3) and subsequent human error during its repair. Loss of data and the delay in restoring operations and data resulted from the failure to follow two key industry best practices. Also, there was an insufficient degree of self governance toward continuous process improvement and the management of risk. Many components selected for the data center and its IT infrastructure meet or exceed industry best practices, but that implementation falls short in certain areas. Under Northrop Grumman's contract with the Commonwealth, overseen by the Virginia Information Technologies Agency (VITA), the company provides IT infrastructure services for executive branch agencies. Those services include networks, data centers, storage, servers, messaging and personal computers. Link to Agilysys review: http://www.governor.virginia.gov/News/docs/NorthropGrummanAudit.pdf Link to JLARC summary of the audit report: http://jlarc.virginia.gov/other/JLARC%20NG%20Audit%20Summary.pdf Jeff Caldwell Press Secretary (804) 786-2211 Marcella Williamson (804) 416-6002 ((M2 Communications disclaims all liability for information provided within M2 PressWIRE. Data supplied by named party/parties. Further information on M2 PressWIRE can be obtained at http://www.presswire.net on the world wide web. Inquiries to [email protected]. |