Leidos Inc. awarded $60.6M for combat environment simulation services by the Department of the Navy
Contract Overview
Contract Amount: $60,575,568 ($60.6M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2011-09-28
End Date: 2019-09-30
Contract Duration: 2,924 days
Daily Burn Rate: $20.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: COMBAT ENVIRONMENT SIMULATION
Place of Performance
Location: RIDGECREST, KERN County, CALIFORNIA, 93555
Plain-Language Summary
Department of Defense obligated $60.6 million to LEIDOS, INC. for work described as: COMBAT ENVIRONMENT SIMULATION Key points: 1. Contract awarded via full and open competition, suggesting a robust market for these specialized engineering services. 2. The contract duration of approximately 8 years indicates a long-term need for simulation capabilities. 3. The use of a Cost Plus Fixed Fee (CPFF) pricing structure may present cost control challenges if not closely managed. 4. The primary contractor, Leidos, Inc., is a significant player in defense contracting, implying established capabilities. 5. The contract's focus on simulation suggests a role in training and development for military personnel. 6. The absence of small business set-asides indicates the primary contract was not specifically targeted for small business participation.
Value Assessment
Rating: fair
Benchmarking the value of this contract is challenging without specific performance metrics or comparable simulation contracts. The CPFF structure requires diligent oversight to ensure costs remain reasonable and the fixed fee aligns with the effort. While the total award is substantial, its value is contingent on the effectiveness of the simulation services delivered and the efficiency of Leidos's execution.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple capable vendors had the opportunity to bid. This competitive process is generally expected to yield fair market pricing and encourage innovation. The fact that it was a single award suggests Leidos, Inc. was the most advantageous offeror based on the evaluation criteria.
Taxpayer Impact: Full and open competition typically benefits taxpayers by fostering a competitive environment that can lead to better pricing and service quality, preventing potential overcharges associated with less competitive solicitations.
Public Impact
Naval personnel benefit from advanced combat environment simulation for training and mission preparedness. The services delivered likely enhance the realism and effectiveness of military training programs. The contract's performance is tied to the Department of the Navy, with potential geographic impact related to training facilities. The contract supports specialized engineering and technical roles within the defense sector workforce.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee (CPFF) contracts can lead to cost overruns if not meticulously managed and monitored.
- The long contract duration increases the risk of scope creep or evolving requirements not being adequately addressed.
- Reliance on a single contractor for critical simulation services could pose a risk if performance falters.
Positive Signals
- Awarded through full and open competition, suggesting a competitive pricing environment.
- Leidos, Inc. is a large, established defense contractor with a track record in complex systems.
- The contract addresses a critical need for advanced military training simulation.
Sector Analysis
The defense sector heavily relies on advanced simulation and training technologies to prepare personnel for complex operational environments. This contract falls within the engineering services sub-sector, which is crucial for developing and maintaining sophisticated military systems. Spending in this area is driven by the need for realistic training scenarios that are cost-effective and safe compared to live exercises. Comparable spending benchmarks would involve other simulation and training contracts awarded to large defense prime contractors.
Small Business Impact
This contract does not appear to have included specific small business set-asides. As a large prime contract awarded to Leidos, Inc., there may be opportunities for small businesses to participate as subcontractors. However, the extent of small business subcontracting is not detailed in the provided data and would require further investigation into the contract's subcontracting plan.
Oversight & Accountability
Oversight for this contract would typically be managed by the Department of the Navy's contracting officers and program managers. Accountability measures would be tied to the terms of the Cost Plus Fixed Fee contract, including performance milestones and cost reporting. Transparency is generally maintained through contract award databases and reporting requirements, though specific operational details may be sensitive.
Related Government Programs
- Combat Training Systems
- Military Simulation and Training
- Engineering Services for Defense
- Naval Training Programs
- Simulation Technology Development
Risk Flags
- Cost Plus Fixed Fee pricing structure requires diligent oversight to manage costs.
- Long contract duration may increase risk of scope creep or evolving requirements.
- Potential for contractor inefficiency if cost controls are not robust.
Tags
defense, department-of-the-navy, engineering-services, simulation, combat-environment, cost-plus-fixed-fee, full-and-open-competition, leidos-inc, california, large-contract, long-duration
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $60.6 million to LEIDOS, INC.. COMBAT ENVIRONMENT SIMULATION
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $60.6 million.
What is the period of performance?
Start: 2011-09-28. End: 2019-09-30.
What is the historical spending trend for combat environment simulation services by the Department of the Navy?
Analyzing historical spending trends for combat environment simulation services by the Department of the Navy requires access to comprehensive contract databases over multiple fiscal years. While this specific contract award is for approximately $60.6 million over its duration, understanding the broader trend involves looking at the total obligated amounts for similar contracts awarded annually. Factors influencing these trends include evolving military doctrines, technological advancements in simulation, geopolitical events, and budget allocations. A detailed analysis would involve identifying all contracts with relevant Product Service Codes (PSCs) or keywords related to simulation and training, and then aggregating their values to observe year-over-year changes. This would help determine if spending in this area is increasing, decreasing, or remaining stable, and identify any significant shifts in contracting strategies or awarded amounts.
How does the per-unit cost of this combat environment simulation compare to similar contracts?
Determining a precise per-unit cost for this combat environment simulation contract is difficult without knowing the specific units of service or deliverables. The contract is for engineering services related to simulation, not a fixed quantity of simulation hours or units. Therefore, a direct per-unit cost comparison is not feasible with the provided data. To benchmark, one would need to identify comparable contracts that specify the quantity and type of simulation services provided. If, for example, the contract involved a certain number of simulation hours, we could calculate an hourly rate. However, given the 'Engineering Services' classification and the CPFF structure, the cost is more tied to labor hours, materials, and a fixed profit margin rather than discrete, quantifiable units. A meaningful comparison would require detailed statements of work from similar contracts to establish a basis for cost analysis.
What is Leidos, Inc.'s track record with the Department of the Navy for simulation and training contracts?
Leidos, Inc. has a significant track record with the Department of the Navy, including numerous contracts related to engineering services, IT, and complex systems integration. For simulation and training specifically, Leidos has been involved in various projects, leveraging its expertise in software development, systems engineering, and modeling. Their history with the Navy suggests a capacity to handle large, complex contracts. A thorough review of past awards would reveal the scope and value of their previous simulation-related work, including performance history, any past performance issues, and their success in delivering similar capabilities. This specific $60.6 million contract indicates continued trust and reliance by the Navy on Leidos for critical simulation services, building upon their established relationship.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for simulation services?
The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for simulation services revolve around cost control and contractor efficiency. For the government, there's a risk that the contractor may not be incentivized to control costs rigorously, as the government agrees to cover all allowable costs plus a predetermined fixed fee (profit). This can lead to cost overruns if the contractor's estimates are inaccurate or if unforeseen issues arise. For the contractor, the risk lies in accurately estimating the total costs to ensure the fixed fee provides an adequate return on investment. If costs exceed estimates significantly, the contractor's profit margin shrinks. Effective management requires robust government oversight to scrutinize allowable costs, ensure efficient performance, and manage any changes to the contract scope to prevent uncontrolled cost escalation.
How has the Department of the Navy's spending on engineering services evolved over the past five years?
The Department of the Navy's spending on engineering services has generally remained substantial, reflecting the ongoing need for technical expertise in designing, developing, and maintaining complex naval systems and infrastructure. Over the past five years, trends have likely been influenced by modernization efforts, new platform acquisitions, and readiness requirements. While specific figures require detailed database analysis, it's reasonable to assume consistent, high-level investment in areas such as naval architecture, systems engineering, cybersecurity, and specialized technical support like simulation. Budgetary constraints, strategic priorities (e.g., fleet expansion, technological upgrades), and the overall defense spending climate would shape the year-to-year fluctuations. Contracts like the one awarded to Leidos for combat environment simulation are indicative of the continued demand for specialized engineering capabilities within the Navy's operational and training domains.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: N6893609R0001
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 700 N FREDERICK AVE, GAITHERSBURG, MD, 20879
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $62,076,427
Exercised Options: $62,076,427
Current Obligation: $60,575,568
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N6893610D0035
IDV Type: IDC
Timeline
Start Date: 2011-09-28
Current End Date: 2019-09-30
Potential End Date: 2019-09-30 00:00:00
Last Modified: 2022-08-23
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