USAID's $4.7B IT Services Contract: NTT DATA Secures Key Role in Custom Programming

Contract Overview

Contract Amount: $470,511,409 ($470.5M)

Contractor: NTT Data Federal Services, Inc.

Awarding Agency: Agency for International Development

Start Date: 2019-05-01

End Date: 2026-01-31

Contract Duration: 2,467 days

Daily Burn Rate: $190.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: THIS IS TO ESTABLISH FUNDING FOR THE NEW O&M CONTRACT IN THE AMOUNT OF $4,254,495.93 FROM MAY 1, 2019 - JULY 31, 2019.

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20171

State: Virginia Government Spending

Plain-Language Summary

Agency for International Development obligated $470.5 million to NTT DATA FEDERAL SERVICES, INC. for work described as: THIS IS TO ESTABLISH FUNDING FOR THE NEW O&M CONTRACT IN THE AMOUNT OF $4,254,495.93 FROM MAY 1, 2019 - JULY 31, 2019. Key points: 1. Contract awarded to NTT DATA FEDERAL SERVICES, INC. for custom computer programming services. 2. Significant contract value of approximately $470.5 million over its lifecycle. 3. Contract duration spans over 6 years, indicating a long-term need for services. 4. Awarded under a full and open competition, suggesting a robust bidding process. 5. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 6. Services are categorized under NAICS code 541511 (Custom Computer Programming Services). 7. The contract is managed by the Agency for International Development (USAID).

Value Assessment

Rating: good

The contract's total value of $470.5 million over approximately 6.8 years suggests a substantial investment in IT services. While specific performance metrics are not detailed here, the firm-fixed-price structure indicates an expectation of defined deliverables at a set cost. Benchmarking against similar large-scale IT service contracts would be necessary for a more precise value-for-money assessment, but the scale implies a significant operational need.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through a full and open competition, indicating that multiple vendors were likely invited to bid. The presence of 3 bids suggests a competitive environment, which typically benefits the government by driving down prices and encouraging innovation. The specific details of the bidding process and the number of proposals received would provide further insight into the level of competition.

Taxpayer Impact: A full and open competition generally leads to better price discovery and potentially lower costs for taxpayers compared to sole-source or limited competitions.

Public Impact

The primary beneficiary is the Agency for International Development (USAID), which will receive custom computer programming services to support its operations. These services are crucial for maintaining and developing IT systems that underpin USAID's global development and humanitarian assistance programs. The contract supports IT infrastructure and software development, indirectly impacting the efficiency and effectiveness of USAID's mission delivery worldwide. While not directly tied to a specific geographic region in the provided data, USAID's work is global, suggesting the IT services support a broad range of international activities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if specific technologies or platforms become proprietary.
Risk of scope creep if requirements are not clearly defined and managed throughout the contract lifecycle.
Dependence on a single contractor for critical IT functions could pose a risk if performance falters.

Positive Signals

Firm-fixed-price contract structure shifts cost overrun risk to the contractor.
Full and open competition suggests a healthy market engagement and potential for competitive pricing.
Long contract duration allows for stable planning and execution of IT projects.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on custom computer programming services. The IT services market is vast and highly competitive, with numerous companies offering specialized development and support. Contracts of this magnitude are common for large federal agencies like USAID, which require robust IT infrastructure to manage complex global operations. Comparable spending benchmarks would involve analyzing other large IT service contracts awarded to federal agencies for custom software development and maintenance.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, the primary contractor, NTT DATA FEDERAL SERVICES, INC., is likely a large business. There is no explicit information regarding subcontracting plans for small businesses. Without this information, it is difficult to assess the direct impact on the small business ecosystem, though large prime contracts often include subcontracting goals that can benefit smaller firms.

Oversight & Accountability

Oversight for this contract would typically be managed by the Agency for International Development (USAID) through its contracting officers and program managers. Accountability measures are inherent in the firm-fixed-price contract type, requiring the contractor to meet defined specifications. Transparency is generally facilitated through contract databases like FPDS, which publish award details. The specific Inspector General jurisdiction would be that of USAID's Office of Inspector General.

Related Government Programs

IT Services
Custom Software Development
Federal IT Procurement
Agency for International Development Contracts
Large IT Contracts

Risk Flags

Potential for vendor lock-in
Scope creep risk
Dependence on single contractor

Frequently Asked Questions

What is this federal contract paying for?

Agency for International Development awarded $470.5 million to NTT DATA FEDERAL SERVICES, INC.. THIS IS TO ESTABLISH FUNDING FOR THE NEW O&M CONTRACT IN THE AMOUNT OF $4,254,495.93 FROM MAY 1, 2019 - JULY 31, 2019.

Who is the contractor on this award?

The obligated recipient is NTT DATA FEDERAL SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Agency for International Development (Agency for International Development).

What is the total obligated amount?

The obligated amount is $470.5 million.

What is the period of performance?

Start: 2019-05-01. End: 2026-01-31.

What is the historical spending pattern for custom computer programming services at USAID?

Analyzing USAID's historical spending on custom computer programming services (NAICS 541511) would provide context for the $470.5 million awarded to NTT DATA FEDERAL SERVICES, INC. This involves examining past contract awards, their values, durations, and the contractors involved. A trend of increasing or decreasing investment in this area could indicate shifts in agency priorities or technological adoption. Comparing this contract's value to previous years' spending can reveal whether this represents a significant increase, a continuation of existing investment levels, or a decrease. Understanding this pattern helps assess if the current award aligns with long-term strategic IT planning or is an anomaly. Without specific historical data, it's challenging to definitively categorize this award's place within USAID's broader IT budget trajectory.

How does the per-unit cost of this contract compare to similar IT services contracts?

Determining the per-unit cost requires identifying a standardized unit of service (e.g., labor hour, functional module, system component) and its associated cost. For this contract, the total value is $470.5 million over approximately 2467 days (duration). However, without knowing the specific services rendered per unit or the labor mix, a direct per-unit cost comparison is difficult. Benchmarking would involve comparing the average loaded labor rates or the cost per function point against industry standards or other government contracts for similar custom programming services. Given the firm-fixed-price nature, the contractor is responsible for managing these internal costs to meet the agreed-upon price. A detailed analysis would require access to the contract's detailed CLIN structure and potentially labor rate information if it were a cost-reimbursable or time-and-materials contract.

What is NTT DATA FEDERAL SERVICES, INC.'s track record with USAID and other federal agencies for similar services?

NTT DATA FEDERAL SERVICES, INC. has a significant track record in providing IT services to various U.S. federal agencies, including USAID. Examining their past performance on contracts for custom computer programming (NAICS 541511) and related IT services is crucial. This includes reviewing contract history for on-time delivery, quality of work, adherence to budget, and any past performance issues or awards. For USAID specifically, understanding their history with NTT DATA can indicate a level of trust and proven capability. A review of contract databases would reveal the number and value of previous awards to NTT DATA, the agencies they served, and the types of services rendered. Positive past performance generally reduces perceived risk for future contract awards, suggesting the agency has confidence in the contractor's ability to deliver.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract?

The provided data does not detail the specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. However, for a contract of this nature and value, it is highly probable that robust KPIs and SLAs are defined within the contract's Statement of Work (SOW). These would typically cover aspects such as system uptime, response times for bug fixes, development cycle times, adherence to security protocols, and user satisfaction metrics. The firm-fixed-price structure implies that meeting these defined performance standards is critical for the contractor to achieve profitability. USAID's program managers would monitor these KPIs/SLAs to ensure the contractor is meeting its obligations and delivering the expected value. Failure to meet critical SLAs could result in penalties or contract termination.

How does the competition level (3 bidders) impact the overall value and risk for this contract?

Having 3 bidders for this contract indicates a moderate level of competition. While more bidders generally lead to greater price pressure and potentially better value, 3 bidders suggest that the market for these specific custom programming services is not overly saturated but also not a sole-source situation. This level of competition likely provided USAID with a reasonable range of options and pricing, mitigating some risk of overpayment. However, it might not have driven prices down as aggressively as a competition with 5+ bidders. The risk associated with this level of competition is balanced; it suggests that qualified vendors exist, but the agency should still conduct thorough due diligence on the winning bid to ensure optimal value and minimize performance risks.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming 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: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Nippon Telegraph and Telephone Corporation

Address: 2551 DULLES VIEW DR, HERNDON, VA, 20171

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $499,910,272

Exercised Options: $499,910,272

Current Obligation: $470,511,409

Actual Outlays: $436,066,381

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS35F518GA

IDV Type: FSS

Timeline