Northrop Grumman Awarded $734M for IT Support and Systems Analysis by Social Security Administration
Contract Overview
Contract Amount: $734,075,303 ($734.1M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Social Security Administration
Start Date: 2018-07-03
End Date: 2022-11-04
Contract Duration: 1,585 days
Daily Burn Rate: $463.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: LABOR HOURS
Sector: IT
Official Description: CONTRACTOR IS TO PROVIDE THE EXPERTISE, TECHNICAL KNOWLEDGE, IT SUPPORT PERSONNEL, AND OTHER RELATED RESOURCES NECESSARY FOR SYSTEMS ANALYSIS AND TESTING
Place of Performance
Location: BALTIMORE, BALTIMORE CITY County, MARYLAND, 21235
State: Maryland Government Spending
Plain-Language Summary
Social Security Administration obligated $734.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: CONTRACTOR IS TO PROVIDE THE EXPERTISE, TECHNICAL KNOWLEDGE, IT SUPPORT PERSONNEL, AND OTHER RELATED RESOURCES NECESSARY FOR SYSTEMS ANALYSIS AND TESTING Key points: 1. Significant contract value of $734M for IT support services. 2. Competition was full and open, suggesting potential for competitive pricing. 3. Risk is moderate, given the long duration and large value. 4. IT services sector is highly competitive and prone to rapid technological change.
Value Assessment
Rating: good
The contract value is substantial, and the pricing is based on labor hours. Without specific labor rates or comparison data for similar IT support services, a precise value assessment is difficult, but the scale suggests a negotiated price reflecting market conditions for complex IT support.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically allows for the widest range of potential bidders and encourages competitive pricing. The use of a delivery order mechanism within this framework suggests a structured procurement process.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to more cost-effective solutions and better pricing for government services.
Public Impact
Ensures continued IT support for critical SSA systems. Supports a major defense contractor's operations. Impacts federal IT service procurement strategies. Potential for job creation within the IT sector.
Waste & Efficiency Indicators
Waste Risk Score: 75 / 10
Warning Flags
- Long contract duration (over 4 years) may lead to scope creep or outdated technology.
- Large contract value increases financial risk if performance issues arise.
Positive Signals
- Full and open competition promotes market efficiency.
- Award to a large, established contractor may ensure stability and expertise.
Sector Analysis
This contract falls within the Other Computer Related Services sector, a broad category encompassing IT support, systems analysis, and testing. Spending in this sector is consistently high across federal agencies, driven by the need for modern and secure IT infrastructure.
Small Business Impact
The contract was awarded to Northrop Grumman Systems Corporation, a large business. There is no indication of small business participation in this specific award, which is common for large, complex IT service contracts.
Oversight & Accountability
The contract was awarded under full and open competition, and the use of delivery orders implies ongoing oversight of task execution. However, the long duration necessitates continuous monitoring to ensure performance and value.
Related Government Programs
- Other Computer Related Services
- Social Security Administration Contracting
- Social Security Administration Programs
Risk Flags
- Potential for cost overruns due to long duration.
- Risk of technological obsolescence.
- Dependence on a single large contractor for critical IT functions.
- Performance variability over the contract term.
Tags
other-computer-related-services, social-security-administration, md, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Social Security Administration awarded $734.1 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. CONTRACTOR IS TO PROVIDE THE EXPERTISE, TECHNICAL KNOWLEDGE, IT SUPPORT PERSONNEL, AND OTHER RELATED RESOURCES NECESSARY FOR SYSTEMS ANALYSIS AND TESTING
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Social Security Administration (Social Security Administration).
What is the total obligated amount?
The obligated amount is $734.1 million.
What is the period of performance?
Start: 2018-07-03. End: 2022-11-04.
What is the average hourly rate for the IT support personnel provided under this contract, and how does it compare to industry benchmarks for similar roles and experience levels?
The contract is priced based on labor hours, but specific hourly rates are not provided in the summary data. To assess value, a comparison of these rates against market benchmarks for IT support specialists, systems analysts, and testers with comparable experience and security clearances would be necessary. This would reveal if the government is paying a competitive price for the required expertise.
What mechanisms are in place to manage technological obsolescence and ensure the IT support remains relevant throughout the contract's duration?
Given the contract's duration (over 4 years), proactive management of technological obsolescence is crucial. The SSA should have processes for regular technology reviews, performance assessments, and potentially contract modifications to incorporate updated technologies or methodologies. This ensures the IT support remains effective and doesn't become a liability due to outdated systems or practices.
How is the effectiveness of the systems analysis and testing services measured, and what key performance indicators (KPIs) are used to evaluate contractor performance?
The effectiveness of systems analysis and testing is typically measured through KPIs such as defect detection rates, test coverage, system performance improvements, and timely delivery of analysis reports. The contract likely includes specific performance standards and metrics that the contractor must meet, with penalties or incentives tied to achieving these objectives.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: 28321318R00000040
Offers Received: 2
Pricing Type: LABOR HOURS (Z)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 7575 COLSHIRE DR, MCLEAN, VA, 22102
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $734,109,536
Exercised Options: $734,109,536
Current Obligation: $734,075,303
Actual Outlays: $664,867,954
Subaward Activity
Number of Subawards: 1612
Total Subaward Amount: $2,353,490,954
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SS001760017
IDV Type: IDC
Timeline
Start Date: 2018-07-03
Current End Date: 2022-11-04
Potential End Date: 2022-11-04 00:00:00
Last Modified: 2022-10-28
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