Leidos awarded $123M for Army Global Unified Network Increment 1, a 3-year IT systems design contract
Contract Overview
Contract Amount: $122,882,647 ($122.9M)
Contractor: Leidos, Inc.
Awarding Agency: General Services Administration
Start Date: 2024-09-06
End Date: 2027-03-05
Contract Duration: 910 days
Daily Burn Rate: $135.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: COST PLUS AWARD FEE
Sector: IT
Official Description: ARMY GLOBAL UNIFIED NETWORK INCREMENT 1
Place of Performance
Location: FORT SHAFTER, HONOLULU County, HAWAII, 96858
State: Hawaii Government Spending
Plain-Language Summary
General Services Administration obligated $122.9 million to LEIDOS, INC. for work described as: ARMY GLOBAL UNIFIED NETWORK INCREMENT 1 Key points: 1. Contract value of $123M over three years suggests significant investment in network modernization. 2. The 'Computer Systems Design Services' NAICS code indicates a focus on IT infrastructure and integration. 3. Award type as 'Delivery Order' implies this is part of a larger, pre-existing contract vehicle. 4. The contract's duration of 910 days aligns with typical IT modernization project timelines. 5. The 'Cost Plus Award Fee' pricing structure incentivizes performance but requires careful oversight. 6. The contract is for Hawaii, indicating a specific geographic focus for this network upgrade.
Value Assessment
Rating: good
The contract value of $123M for three years of IT systems design services appears reasonable given the scope of modernizing a global unified network. Benchmarking against similar large-scale IT infrastructure projects, this investment level is within expected ranges for complex system integration and design. The 'Cost Plus Award Fee' structure, while potentially leading to higher costs than fixed-price contracts, allows for flexibility in evolving technological requirements and incentivizes contractor performance through award fees, which can drive value if managed effectively.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The presence of 4 bidders (no is 4) suggests a competitive environment, which is generally favorable for price discovery and innovation. However, the specific details of the bidding process, including the number of proposals received and the evaluation criteria, would provide a clearer picture of the actual level of competition and its impact on the final award price.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to better pricing and higher quality services. It ensures that the government explores a wide range of solutions and contractors, maximizing the potential for cost savings and effective service delivery.
Public Impact
The U.S. Army will benefit from an upgraded and unified network infrastructure, enhancing operational capabilities. Services delivered include computer systems design, integration, and potentially ongoing support for network operations. The geographic impact is focused on Hawaii, suggesting a critical upgrade for military installations in that region. Workforce implications may include IT specialists, network engineers, and project managers involved in the design and implementation phases.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Award Fee contracts require diligent oversight to ensure costs remain reasonable and award fees are justified by performance.
- The 'HI' (Hawaii) designation for the state might indicate specific logistical or operational challenges that could impact cost and schedule.
- The complexity of a 'Global Unified Network' implies significant integration challenges and potential for scope creep if not managed tightly.
Positive Signals
- Award under 'Full and Open Competition' suggests a robust bidding process and potential for competitive pricing.
- The contract is for 'Computer Systems Design Services,' indicating a focus on foundational IT infrastructure which is critical for modernization.
- The award is a 'Delivery Order,' implying it leverages an existing contract vehicle, potentially streamlining acquisition and reducing administrative burden.
Sector Analysis
The IT services sector, particularly within government contracting, is characterized by rapid technological advancements and evolving security requirements. This contract for Computer Systems Design Services falls under the broader IT consulting and systems integration market, which is a significant segment of federal IT spending. The market size for such services is substantial, driven by agencies' continuous need to modernize legacy systems, enhance cybersecurity, and improve network performance. Comparable spending benchmarks for large-scale network modernization projects can vary widely based on scope, complexity, and geographic reach, but a $123M award over three years for a critical network increment is indicative of a major undertaking.
Small Business Impact
This contract was not set aside for small businesses, nor does it appear to have specific small business subcontracting requirements indicated by the provided data (ss: false, sb: false). This suggests that the primary award went to a large business, Leidos, Inc. While large prime contracts can sometimes create subcontracting opportunities for small businesses, the absence of explicit set-asides or reporting requirements means the direct impact on the small business ecosystem for this specific award is not guaranteed. Further analysis of subcontracting plans would be needed to assess the extent of small business participation.
Oversight & Accountability
Oversight for this contract will likely be managed by the contracting agency (General Services Administration, Federal Acquisition Service) and the requiring agency (U.S. Army). The 'Cost Plus Award Fee' (CPAF) structure necessitates robust performance monitoring and financial auditing to ensure that award fees are earned based on demonstrated performance against defined objectives. Transparency will depend on the agency's reporting practices and the public availability of contract performance data. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.
Related Government Programs
- Army Network Modernization Programs
- Global Command and Control Systems
- Defense Information Systems Network (DISN)
- IT Infrastructure Modernization Contracts
- Cloud Computing Services for Defense
- Cybersecurity Modernization Initiatives
Risk Flags
- Potential for cost overruns due to CPAF structure.
- Complexity of integrating a 'Global Unified Network'.
- Dependence on contractor performance for award fees.
- Cybersecurity risks inherent in network infrastructure projects.
Tags
it, defense, army, general-services-administration, computer-systems-design-services, full-and-open-competition, delivery-order, cost-plus-award-fee, hawaii, network-modernization, large-business, it-infrastructure
Frequently Asked Questions
What is this federal contract paying for?
General Services Administration awarded $122.9 million to LEIDOS, INC.. ARMY GLOBAL UNIFIED NETWORK INCREMENT 1
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: General Services Administration (Federal Acquisition Service).
What is the total obligated amount?
The obligated amount is $122.9 million.
What is the period of performance?
Start: 2024-09-06. End: 2027-03-05.
What is the track record of Leidos, Inc. in delivering large-scale IT network modernization projects for the Department of Defense?
Leidos, Inc. has a significant track record in providing IT services and solutions to the Department of Defense (DoD) and other federal agencies. They have been involved in numerous large-scale projects related to network modernization, systems integration, cybersecurity, and enterprise IT. For instance, Leidos has held major contracts for areas such as enterprise IT services, cloud migration, and command and control systems. Their experience often includes managing complex, multi-year programs with substantial budgets. However, the success and specific outcomes of these past projects can vary, and a detailed review of performance metrics, past performance evaluations, and any contract disputes or challenges would be necessary for a comprehensive assessment of their suitability for the Army Global Unified Network Increment 1 contract.
How does the awarded price of $123M compare to similar Army network modernization contracts over the past five years?
Comparing the $123M award for the Army Global Unified Network Increment 1 to similar contracts requires access to a comprehensive database of federal contract awards and detailed project scopes. However, based on general market knowledge, $123M over approximately three years for a significant network modernization increment is within a plausible range for large-scale IT infrastructure projects within the DoD. Factors influencing this price include the specific technologies involved, the geographic scope (Hawaii in this case), the level of integration required, and the competitive landscape. Larger, more complex, or longer-duration network overhauls could easily exceed this figure, while smaller, more focused upgrades might cost less. Without specific comparable contract data, it's difficult to definitively benchmark the value, but it suggests a substantial investment in critical infrastructure.
What are the primary risks associated with a 'Cost Plus Award Fee' (CPAF) contract for IT systems design?
The primary risks associated with a Cost Plus Award Fee (CPAF) contract for IT systems design revolve around cost control and performance measurement. For the government, the risk is that costs could escalate beyond initial projections, as the contractor is reimbursed for allowable costs plus a fee that includes a base fee and an award fee contingent on meeting performance targets. This structure can incentivize contractors to incur costs, potentially leading to overspending if not meticulously managed. For the contractor, the risk lies in not achieving the performance objectives required to earn the maximum award fee, impacting their overall profit margin. Effective risk mitigation requires robust government oversight, clear and measurable performance metrics, and rigorous auditing of costs and performance.
What is the expected impact of this contract on the Army's operational effectiveness in Hawaii?
The Army Global Unified Network Increment 1 contract is expected to significantly enhance the Army's operational effectiveness in Hawaii by providing a more robust, secure, and unified network infrastructure. A modernized network can improve communication speed and reliability, facilitate better data sharing among units, and support advanced technologies such as real-time situational awareness tools, AI-driven analytics, and enhanced command and control capabilities. This improved connectivity and data flow are crucial for mission success, enabling faster decision-making, more coordinated operations, and increased resilience against cyber threats. Ultimately, a better network infrastructure directly translates to improved readiness and mission accomplishment for Army forces operating in the region.
How has federal spending on 'Computer Systems Design Services' (NAICS 541512) evolved over the last five fiscal years?
Federal spending on 'Computer Systems Design Services' (NAICS 541512) has shown a consistent upward trend over the last five fiscal years, reflecting the government's ongoing reliance on IT modernization and digital transformation initiatives. Agencies across the board, particularly the Department of Defense, Homeland Security, and civilian departments like HHS and GSA, have increasingly contracted for services related to system design, integration, cloud migration, cybersecurity enhancements, and data analytics. This growth is driven by the need to replace aging legacy systems, improve operational efficiency, enhance cybersecurity postures, and leverage new technologies. While specific annual figures fluctuate based on major program awards and budget cycles, the overall trajectory indicates sustained and significant investment in this category of IT services.
What is the significance of the 'Delivery Order' (AW) designation for this contract?
The 'Delivery Order' (AW) designation signifies that this contract award is not a standalone, new contract but rather an order placed against an existing, pre-established contract vehicle. These vehicles, often Indefinite Delivery/Indefinite Quantity (IDIQ) contracts or other master agreements, are typically awarded through a competitive process and allow agencies to issue task orders or delivery orders for specific goods or services as needed. The significance of this designation is that it implies the underlying contract vehicle has already undergone a competitive selection process, potentially streamlining the acquisition timeline for this specific order. It also suggests that the terms, conditions, and pricing structures were established during the initial award of the contract vehicle.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: 47QFCA24R0009
Offers Received: 4
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Address: 1750 PRESIDENTS ST FL 4, RESTON, VA, 20190
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $331,247,044
Exercised Options: $243,121,837
Current Obligation: $122,882,647
Subaward Activity
Number of Subawards: 41
Total Subaward Amount: $138,823,019
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: 47QTCK18D0008
IDV Type: GWAC
Timeline
Start Date: 2024-09-06
Current End Date: 2027-03-05
Potential End Date: 2029-09-05 00:00:00
Last Modified: 2026-03-03
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