VA's $248M Financial Management Transformation Contract Awarded to Deloitte Consulting LLP

Contract Overview

Contract Amount: $247,927,421 ($247.9M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Veterans Affairs

Start Date: 2018-09-27

End Date: 2023-10-31

Contract Duration: 1,860 days

Daily Burn Rate: $133.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: REQUIREMENT TO SUPPORT THE FINANCIAL MANAGEMENT BUSINESS TRANSFORMATION EFFORT TO TRANSFORM THE VA LEGACY FINANCIAL MANAGEMENT SYSTEM.

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22209

State: Virginia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $247.9 million to DELOITTE CONSULTING LLP for work described as: REQUIREMENT TO SUPPORT THE FINANCIAL MANAGEMENT BUSINESS TRANSFORMATION EFFORT TO TRANSFORM THE VA LEGACY FINANCIAL MANAGEMENT SYSTEM. Key points: 1. Significant investment in modernizing VA's financial systems. 2. Deloitte Consulting LLP, a major player, secured the award. 3. Potential risks include project scope creep and integration challenges. 4. The contract falls within the Administrative Management and General Management Consulting Services sector.

Value Assessment

Rating: good

The contract value of $247.9M over approximately 5 years suggests a substantial investment. Benchmarking against similar large-scale IT transformation projects is difficult without more granular cost data, but the per-unit cost appears reasonable for a complex undertaking.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating a robust price discovery process. This method generally leads to more competitive pricing by allowing all eligible vendors to bid.

Taxpayer Impact: Taxpayer funds are being used for a critical modernization effort, aiming for long-term efficiency gains in financial management.

Public Impact

Improved financial accuracy and reporting for the VA. Potential for streamlined processes and reduced operational costs. Impacts veterans through more efficient allocation of resources. Modernization of legacy systems is crucial for government efficiency.

Waste & Efficiency Indicators

Waste Risk Score: 75 / 10

Warning Flags

Complexity of transforming legacy financial systems.
Potential for schedule delays in large IT projects.
Ensuring data integrity during migration.

Positive Signals

Clear objective to modernize critical financial infrastructure.
Awarded through full and open competition.
Significant investment indicates high priority.

Sector Analysis

This contract falls under Administrative Management and General Management Consulting Services, a broad category often encompassing large-scale IT and business process transformation efforts. Spending in this sector can vary widely based on agency needs and project scope.

Small Business Impact

The data indicates this contract was awarded to a large business (Deloitte Consulting LLP) and does not show any specific set-asides or participation goals for small businesses. Therefore, the direct impact on small businesses appears minimal for this specific award.

Oversight & Accountability

The Department of Veterans Affairs is the contracting and awarding agency. Oversight would typically involve program managers monitoring progress, budget adherence, and deliverable quality to ensure accountability and effective use of funds.

Related Government Programs

Administrative Management and General Management Consulting Services
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Complexity of IT transformation projects.
Potential for cost overruns.
Dependency on contractor performance.
Integration with existing VA systems.
Data security and integrity during migration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $247.9 million to DELOITTE CONSULTING LLP. REQUIREMENT TO SUPPORT THE FINANCIAL MANAGEMENT BUSINESS TRANSFORMATION EFFORT TO TRANSFORM THE VA LEGACY FINANCIAL MANAGEMENT SYSTEM.

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $247.9 million.

What is the period of performance?

Start: 2018-09-27. End: 2023-10-31.

What are the key performance indicators (KPIs) for this financial management transformation effort, and how will their achievement be measured to ensure value for taxpayer money?

Key performance indicators likely include metrics related to system uptime, data accuracy, transaction processing speed, user adoption rates, and the successful retirement of legacy systems. Measurement would involve regular reporting from Deloitte, independent verification by VA personnel, and potentially third-party audits to ensure objectives are met and taxpayer funds are delivering the intended value and efficiency gains.

What specific risks are associated with migrating sensitive financial data from legacy systems to a new platform, and what mitigation strategies are in place?

Risks include data corruption, security breaches during transfer, and incompatibility issues between old and new data formats. Mitigation strategies typically involve robust data validation and cleansing processes before migration, secure data transfer protocols, phased migration approaches, comprehensive testing of the new system with migrated data, and contingency plans for rollback if major issues arise.

How will the success of this transformation be evaluated in terms of long-term operational cost savings and improved financial decision-making capabilities for the VA?

Success will be evaluated by comparing pre-transformation operational costs (e.g., system maintenance, manual processing) with post-transformation costs. Improved decision-making will be assessed through the timeliness and accuracy of financial reports, the ability to perform complex financial analyses, and feedback from financial managers on system usability and data accessibility. Benchmarking against industry standards for modern financial systems will also be considered.

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) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $272,784,263

Exercised Options: $263,116,012

Current Obligation: $247,927,421

Actual Outlays: $81,605,320

Subaward Activity

Number of Subawards: 60

Total Subaward Amount: $69,927,250

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 47QRAA18D001P

IDV Type: FSS

Timeline