DoD's $39.5M IBM Contract for IT Portfolio Management Support Raises Questions on Value and Competition
Contract Overview
Contract Amount: $39,539,734 ($39.5M)
Contractor: International Business Machines Corporation
Awarding Agency: Department of Defense
Start Date: 2008-12-15
End Date: 2013-06-14
Contract Duration: 1,642 days
Daily Burn Rate: $24.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 9
Pricing Type: LABOR HOURS
Sector: IT
Official Description: PORTFOLIO MANAGEMENT AND INFORMATION TECHNOLOGY (IT) INVESTMENT STRATEGIES SUPPORT
Place of Performance
Location: SCOTT AFB, SAINT CLAIR County, ILLINOIS, 62225
State: Illinois Government Spending
Plain-Language Summary
Department of Defense obligated $39.5 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: PORTFOLIO MANAGEMENT AND INFORMATION TECHNOLOGY (IT) INVESTMENT STRATEGIES SUPPORT Key points: 1. Significant contract value ($39.5M) awarded to a single large vendor. 2. Limited insight into the specific IT portfolio management strategies employed. 3. Potential for cost overruns or suboptimal solutions due to lack of demonstrated competition. 4. IT consulting services sector is highly competitive, suggesting other options may exist.
Value Assessment
Rating: questionable
The contract's value of $39.5M for IT portfolio management support is substantial. Without detailed performance metrics or comparisons to similar contracts, it's difficult to assess if this represents excellent value. The pricing structure based on labor hours can sometimes lead to cost escalation if not tightly managed.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Although awarded under full and open competition, the data indicates a single delivery order to IBM. This suggests that while the initial solicitation was open, the subsequent award might not have fully leveraged competitive pressures to drive down costs or ensure the best possible solution.
Taxpayer Impact: The full and open competition framework aims to ensure taxpayer funds are used efficiently. However, the lack of detail on the competitive process for this specific delivery order makes it hard to definitively assess the taxpayer impact.
Public Impact
Taxpayers may not be receiving the most cost-effective IT portfolio management solutions. Lack of transparency on specific deliverables and performance metrics hinders public understanding. Potential for vendor lock-in with IBM for critical IT strategy support.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of clear performance metrics
- Limited visibility into specific IT strategies supported
- Potential for cost creep in labor-hour contracts
Positive Signals
- Awarded under full and open competition
- Supports critical Department of Defense IT functions
Sector Analysis
The IT consulting sector is dynamic, with numerous firms offering expertise in portfolio management. Benchmarking this contract's value against similar engagements for IT strategy and management consulting is crucial for assessing its cost-effectiveness. The $39.5M total award value over five years suggests a significant investment.
Small Business Impact
The contract was awarded to IBM, a large corporation, and there is no indication of small business participation. This suggests that opportunities for small businesses in providing IT portfolio management support within this specific contract were not realized.
Oversight & Accountability
Oversight of this contract would involve monitoring IBM's performance against contract requirements and ensuring that the IT portfolio management strategies align with DoD objectives. Regular reviews of expenditures and deliverables are essential for accountability.
Related Government Programs
- Administrative Management and General Management Consulting Services
- Department of Defense Contracting
- USTRANSCOM Programs
Risk Flags
- Lack of detailed performance metrics
- Limited transparency on specific IT strategies
- Potential for cost overruns due to labor-hour pricing
- No clear indication of small business involvement
Tags
administrative-management-and-general-ma, department-of-defense, il, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $39.5 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. PORTFOLIO MANAGEMENT AND INFORMATION TECHNOLOGY (IT) INVESTMENT STRATEGIES SUPPORT
Who is the contractor on this award?
The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (USTRANSCOM).
What is the total obligated amount?
The obligated amount is $39.5 million.
What is the period of performance?
Start: 2008-12-15. End: 2013-06-14.
What specific IT portfolio management strategies were implemented under this contract, and what were their measurable impacts on DoD's IT investments?
The provided data lacks specifics on the IT portfolio management strategies implemented. To assess value, details on how IBM's support optimized IT investments, reduced redundancies, or improved system performance are needed. Without this, it's challenging to determine if the $39.5M expenditure yielded tangible benefits beyond general administrative support.
Given the competitive nature of the IT consulting market, could a more cost-effective solution have been secured through a different procurement approach or vendor?
While the contract was awarded under full and open competition, the single delivery order to IBM raises questions. The IT consulting market is robust, and exploring alternative contracting vehicles or more defined performance-based statements of work could potentially yield better pricing or more specialized solutions. Further analysis of the competitive landscape at the time of award is warranted.
How effectively did this contract contribute to the Department of Defense's overall IT modernization and efficiency goals?
The effectiveness of this contract in contributing to DoD's IT modernization and efficiency goals is not explicitly detailed. While IBM provided support for portfolio management, the specific outcomes and alignment with broader modernization objectives require further investigation. Metrics demonstrating improvements in IT infrastructure, cost savings, or mission capability enablement would be necessary for a comprehensive assessment.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: HTC71107R0005
Offers Received: 9
Pricing Type: LABOR HOURS (Z)
Evaluated Preference: NONE
Contractor Details
Address: 12902 FEDERAL SYSTEMS PAR, FAIRFAX, VA, 22033
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $39,713,841
Exercised Options: $39,539,734
Current Obligation: $39,539,734
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HTC71107D0011
IDV Type: IDC
Timeline
Start Date: 2008-12-15
Current End Date: 2013-06-14
Potential End Date: 2013-06-14 00:00:00
Last Modified: 2018-10-17
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