Leidos awarded $46.3M for Communications Directorate Software Support, a cost-plus-fixed-fee contract
Contract Overview
Contract Amount: $46,275,889 ($46.3M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2012-05-24
End Date: 2015-05-11
Contract Duration: 1,082 days
Daily Burn Rate: $42.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: AWARD OF TASK ORDER 0055 (S3R-0509) W15P7T-06-D-E405 PWS ENTITLED, "COMMUNICATIONS DIRECTORATE COMMUNICATIONS SOFTWARE SUPPORT."
Place of Performance
Location: MARLTON, BURLINGTON County, NEW JERSEY, 08053
Plain-Language Summary
Department of Defense obligated $46.3 million to LEIDOS, INC. for work described as: AWARD OF TASK ORDER 0055 (S3R-0509) W15P7T-06-D-E405 PWS ENTITLED, "COMMUNICATIONS DIRECTORATE COMMUNICATIONS SOFTWARE SUPPORT." Key points: 1. Contract value represents a significant investment in specialized software support. 2. The cost-plus-fixed-fee structure suggests potential for cost overruns if not closely managed. 3. A single award indicates a specific need or a highly competitive initial selection. 4. The duration of the task order implies a long-term requirement for these services. 5. Performance is managed by the Defense Contract Management Agency, suggesting robust oversight. 6. The engineering services NAICS code points to a technical and specialized nature of the work.
Value Assessment
Rating: fair
The award of $46.3 million for software support over approximately three years warrants careful scrutiny. While specific benchmarks for this niche service are difficult to ascertain without more detailed PWS information, the cost-plus-fixed-fee (CPFF) pricing structure inherently carries risks. CPFF contracts can lead to higher final costs if the contractor's expenses exceed initial estimates, as the government bears the brunt of these increases. Benchmarking against similar long-term, specialized software support contracts within the DoD would be necessary for a more precise value assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but this method generally fosters competitive pricing and encourages contractors to offer their best terms. The selection process likely involved a thorough evaluation of technical capabilities, past performance, and price to ensure the best value for the government.
Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the most competitive pricing and best value by allowing all qualified sources to participate.
Public Impact
The Communications Directorate benefits from enhanced software capabilities and support. This contract ensures the continued operation and potential improvement of critical communication software. The primary beneficiaries are likely internal DoD personnel relying on these communication systems. The contract supports specialized IT and engineering roles within the contractor's organization.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can incentivize higher spending if not meticulously monitored.
- Lack of specific competition numbers makes it difficult to gauge the intensity of price negotiation.
- The long duration could lead to scope creep or evolving requirements that increase costs.
Positive Signals
- Awarded under full and open competition, suggesting a robust selection process.
- Managed by the Defense Contract Management Agency, implying a structured oversight framework.
- The specific PWS title indicates a focused and defined scope of work.
Sector Analysis
This contract falls within the Engineering Services sector, specifically related to IT and communications software support for a government agency. The market for such specialized services is competitive, with numerous firms offering expertise in software development, maintenance, and integration for defense applications. The total addressable market for defense IT and engineering services is substantial, driven by the continuous need for technological modernization and operational support within the Department of Defense.
Small Business Impact
The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. However, the prime contractor, Leidos, Inc., may engage small businesses as subcontractors for specific components or services, depending on their internal strategy and the contract's requirements, which are not detailed here.
Oversight & Accountability
Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), given the agency listed. DCMA is responsible for ensuring contractors meet their contractual obligations, including cost, schedule, and performance. The cost-plus-fixed-fee nature of the contract necessitates close monitoring of expenditures and contractor performance to ensure value for money and prevent cost overruns. Transparency would be facilitated through regular reporting requirements and audits.
Related Government Programs
- DoD Communications Systems Support
- Defense IT Services
- Software Engineering Services
- Information Technology Professional Services
Risk Flags
- Cost-plus-fixed-fee pricing structure requires close monitoring to control costs.
- Long contract duration increases risk of scope creep and technological obsolescence.
- Limited public information on specific deliverables and performance metrics.
Tags
it, defense, engineering-services, software-support, cost-plus-fixed-fee, full-and-open-competition, department-of-defense, defense-contract-management-agency, new-jersey, task-order
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $46.3 million to LEIDOS, INC.. AWARD OF TASK ORDER 0055 (S3R-0509) W15P7T-06-D-E405 PWS ENTITLED, "COMMUNICATIONS DIRECTORATE COMMUNICATIONS SOFTWARE SUPPORT."
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $46.3 million.
What is the period of performance?
Start: 2012-05-24. End: 2015-05-11.
What is the specific nature of the 'Communications Directorate Communications Software Support' and what are the key deliverables?
The task order PWS (Performance Work Statement) titled 'Communications Directorate Communications Software Support' likely details the specific software systems the contractor is responsible for. This could include development, integration, maintenance, sustainment, and enhancement of various communication platforms used by the Directorate. Key deliverables would typically involve software updates, bug fixes, system performance reports, technical documentation, user support, and potentially new feature development or system upgrades. The exact scope is defined within the PWS, which is not fully detailed in the provided data but is crucial for understanding the full value and performance expectations of the contract.
How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for similar IT support services?
Cost Plus Fixed Fee (CPFF) contracts are often used when the scope of work is not precisely defined or involves a high degree of uncertainty, such as research and development or complex system integration. For IT support services, other common structures include Firm-Fixed Price (FFP), where the contractor agrees to a set price, offering cost certainty to the government but potentially higher initial bids to cover contractor risk. Time and Materials (T&M) contracts are used for smaller efforts or when the level of effort is unknown. CPFF offers flexibility but requires stringent oversight to control costs, as the government reimburses allowable costs plus a fixed fee, which can lead to higher total costs than FFP if not managed effectively. Benchmarking against FFP contracts for similar, well-defined IT support tasks would highlight the potential cost premium associated with the CPFF structure.
What is Leidos, Inc.'s track record with similar DoD software support contracts?
Leidos, Inc. is a major government contractor with extensive experience in IT, engineering, and defense services. They have a significant history of performing complex software development, integration, and sustainment contracts for the Department of Defense and other federal agencies. Analyzing Leidos's past performance on similar CPFF or other contract types for software support would involve reviewing contract databases for performance ratings, any documented issues (e.g., contract disputes, overruns), and the scale and complexity of previous projects. Their established presence suggests a capacity to handle large, technical contracts, but specific performance metrics on comparable tasks are essential for a complete assessment.
What are the potential risks associated with a three-year software support contract managed by DCMA?
Potential risks for a three-year software support contract include scope creep, where requirements expand beyond the original PWS, leading to cost increases and schedule delays. Technological obsolescence is another risk; software and hardware can become outdated quickly, requiring continuous adaptation. Contractor performance issues, such as failure to meet service level agreements or deliver quality work, are also a concern. For a CPFF contract, the primary risk is cost overrun, as the government bears the cost of increased expenses. The Defense Contract Management Agency (DCMA) plays a critical role in mitigating these risks through diligent oversight, performance monitoring, and ensuring adherence to the PWS and contract terms.
How does this $46.3 million award compare to overall DoD spending on IT and engineering services?
The $46.3 million award represents a specific task order within the broader category of DoD IT and engineering services. The DoD's annual budget for IT and related services runs into the tens of billions of dollars, encompassing a vast array of requirements from cybersecurity and network infrastructure to software development and data analytics. This single award, while substantial for the specific function it supports, is a relatively small fraction of the total DoD IT spending. Comparing it to benchmarks would involve looking at the average award size for similar types of software support task orders or contracts within the defense sector, considering factors like duration, complexity, and pricing structure.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 3000 LINCOLN DR E, MARLTON, NJ, 08053
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $47,977,644
Exercised Options: $46,288,772
Current Obligation: $46,275,889
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W15P7T06DE405
IDV Type: IDC
Timeline
Start Date: 2012-05-24
Current End Date: 2015-05-11
Potential End Date: 2015-05-11 00:00:00
Last Modified: 2022-09-02
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