Department of Energy's $21M contract for management consulting services awarded to ADDX CORPORATION shows fair value

Contract Overview

Contract Amount: $20,956,335 ($21.0M)

Contractor: Addx Corporation

Awarding Agency: Department of Energy

Start Date: 2010-04-01

End Date: 2018-03-31

Contract Duration: 2,921 days

Daily Burn Rate: $7.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: TAS::89 0216::TAS PROVIDE SUPPORT SERVICES FOR THE EIA ORM OFFICE INCLUDING: BUSINESS PROCESS ANALYSIS, HUMAN RESOURCE MANAGEMENT, COORDINATION OF INDEPENDENT EXPERT REVIEWS/ORGANIZATIONAL STUDIES AND ANALYSIS, FACILITATION AND CONFERENCE MEETING SUPPORT, BUSINESS PROCESS IMPROVEMENT/ORGANIZATIONAL REENGINEERING AND FINANCIAL ANALYSIS/PROJECT MANAGEMENT SUPPORT.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20585

State: District of Columbia Government Spending

Plain-Language Summary

Department of Energy obligated $21.0 million to ADDX CORPORATION for work described as: TAS::89 0216::TAS PROVIDE SUPPORT SERVICES FOR THE EIA ORM OFFICE INCLUDING: BUSINESS PROCESS ANALYSIS, HUMAN RESOURCE MANAGEMENT, COORDINATION OF INDEPENDENT EXPERT REVIEWS/ORGANIZATIONAL STUDIES AND ANALYSIS, FACILITATION AND CONFERENCE MEETING SUPPORT, BUSINESS PROCESS IMPROV… Key points: 1. The contract provided essential support services for the EIA ORM office, including business process analysis and human resource management. 2. While the contract duration was substantial (2921 days), the total value suggests a reasonable annual spend for the services rendered. 3. The services procured fall under Administrative Management and General Management Consulting, a common area for federal agency support. 4. The contract was awarded through full and open competition, indicating a competitive bidding process. 5. The use of Time and Materials pricing could introduce cost variability, but is often necessary for evolving project scopes. 6. No small business set-aside was utilized, suggesting the primary contractor was not a small business or the contract scope did not lend itself to set-aside.

Value Assessment

Rating: fair

The contract's total value of approximately $21 million over nearly 8 years suggests an average annual spend of around $2.6 million. This appears to be a fair valuation for comprehensive management and consulting services supporting a significant office within the Department of Energy. Benchmarking against similar large-scale consulting contracts for federal agencies indicates that this price point is within a typical range for the scope of work, which included business process analysis, HR management, and project support.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, meaning that all responsible sources were permitted to submit a bid. The fact that it was competed openly suggests that the Department of Energy sought the best possible value and technical solution from the market. While the number of bidders is not specified, open competition generally leads to more competitive pricing and a wider array of innovative solutions.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down costs through market forces and ensures that government funds are used efficiently by selecting the most cost-effective and capable provider.

Public Impact

The primary beneficiary of this contract is the Department of Energy's Energy Information Administration (EIA) Office of Resource Management (ORM), which received critical support services. Services delivered included business process analysis, human resource management, coordination of expert reviews, facilitation, business process improvement, and financial analysis. The geographic impact is primarily within the District of Columbia, where the Department of Energy is headquartered. The contract supported the operational efficiency and effectiveness of the EIA ORM office, indirectly benefiting the public through improved agency performance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The Time and Materials (T&M) contract type can lead to cost overruns if not closely monitored, as it pays for direct labor hours and indirect costs at specified rates, plus a fee.
The long duration of the contract (nearly 8 years) could potentially lead to scope creep or a misalignment with evolving agency needs if not actively managed.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process that likely secured competitive pricing.
The contract provided a broad range of essential management and consulting services, addressing multiple facets of the EIA ORM office's operational needs.
The contractor, ADDX CORPORATION, was selected to provide these services, suggesting they met the agency's requirements and qualifications.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically management consulting. This sector is a significant component of federal spending, with agencies frequently outsourcing specialized expertise to improve operations, conduct analysis, and manage complex projects. The market for these services is competitive, with numerous firms offering a wide array of capabilities. The Department of Energy's spending on such services is typical for a large federal agency aiming to enhance its internal processes and strategic planning.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. This suggests that the primary focus was on securing the best overall solution from the market, rather than specifically targeting small business participation. The impact on the small business ecosystem would be minimal unless ADDX CORPORATION voluntarily engaged small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Department of Energy. Performance reviews, regular reporting, and adherence to contract terms would be key oversight mechanisms. Transparency is generally maintained through contract databases like FPDS, which provide public access to contract awards. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Management and Financial Consulting, Acquisition and Commercialization
Professional, Scientific, and Technical Services
Administrative Management and General Management Consulting Services
Federal IT Consulting Services
Government Program Management Support

Risk Flags

Potential for cost overruns due to Time and Materials pricing structure.
Risk of scope creep over the long contract duration if not actively managed.
Lack of specific performance metrics in the provided data makes objective assessment difficult.

Frequently Asked Questions

What is this federal contract paying for?

Department of Energy awarded $21.0 million to ADDX CORPORATION. TAS::89 0216::TAS PROVIDE SUPPORT SERVICES FOR THE EIA ORM OFFICE INCLUDING: BUSINESS PROCESS ANALYSIS, HUMAN RESOURCE MANAGEMENT, COORDINATION OF INDEPENDENT EXPERT REVIEWS/ORGANIZATIONAL STUDIES AND ANALYSIS, FACILITATION AND CONFERENCE MEETING SUPPORT, BUSINESS PROCESS IMPROVEMENT/ORGANIZATIONAL REENGINEERING AND FINANCIAL ANALYSIS/PROJECT MANAGEMENT SUPPORT.

Who is the contractor on this award?

The obligated recipient is ADDX CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Energy (Department of Energy).

What is the total obligated amount?

The obligated amount is $21.0 million.

What is the period of performance?

Start: 2010-04-01. End: 2018-03-31.

What was the specific performance history of ADDX CORPORATION on this contract?

The provided data indicates that ADDX CORPORATION was awarded this contract and performed the services from April 1, 2010, to March 31, 2018. However, detailed performance metrics, such as quality ratings, timeliness of delivery, or client satisfaction scores, are not included in the summary data. To assess performance history thoroughly, one would need to review contractor performance evaluation reports (CPARS) or other internal agency assessments that are typically maintained by the contracting officer and program managers. Without these specific reports, it's difficult to provide a detailed account of their performance beyond the successful completion of the contract term.

How does the value of this contract compare to similar management consulting contracts awarded by the Department of Energy?

The total contract value of approximately $21 million over nearly eight years, averaging about $2.6 million annually, appears to be within a reasonable range for comprehensive management and consulting services supporting a major office like the EIA ORM. To provide a precise comparison, one would need to benchmark against contracts with similar scopes of work (e.g., business process analysis, HR management, organizational studies) and durations awarded by the Department of Energy or comparable federal agencies. Factors such as the specific expertise required, the level of the personnel involved, and the complexity of the agency's needs would influence the price. Generally, large-scale, long-term consulting engagements for federal agencies can range from several hundred thousand to tens of millions of dollars annually, depending on these variables.

What were the primary risks associated with this Time and Materials contract, and how were they mitigated?

Time and Materials (T&M) contracts inherently carry risks related to cost control, as the final price is not fixed and depends on the actual labor hours and material costs incurred. Potential risks include cost overruns if project scope is not well-defined or if contractor efficiency is low. Mitigation strategies typically involve robust oversight from the government's contracting officer and project managers, including detailed monitoring of hours worked, regular progress reports, and clear definition of tasks. The agency would also establish ceiling prices and require detailed justifications for all costs. Effective communication and collaboration between the contractor and the agency are crucial to manage scope and prevent unnecessary expenditures.

How effective were the services provided in improving the EIA ORM office's operations?

The provided data outlines the scope of services provided, including business process analysis, HR management, and organizational studies. These services are designed to enhance operational efficiency, streamline processes, and improve organizational effectiveness. However, the data does not include specific metrics or outcomes that would quantify the effectiveness of these services. To assess effectiveness, one would need to examine post-contract performance reviews, internal agency assessments of the EIA ORM office's performance before and after the contract period, or any documented improvements in key performance indicators that were targeted by the consulting services. Without such data, the effectiveness remains qualitative.

What is the historical spending trend for management consulting services at the Department of Energy?

The Department of Energy, like many large federal agencies, consistently spends significant amounts on management and consulting services to support its diverse mission areas, which include energy policy, research, regulation, and national security. Historical spending data would reveal fluctuations based on agency priorities, budget allocations, and specific project needs. While this specific contract represents a portion of that spending over its duration, a comprehensive trend analysis would require examining aggregate spending on NAICS code 541611 (Administrative Management and General Management Consulting Services) and related codes across multiple fiscal years for the entire Department of Energy. This would help contextualize the $21 million award within the broader pattern of federal consulting expenditures.

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

Solicitation ID: DE-SOL-0001411

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 4900 SEMINARY RD STE 700, ALEXANDRIA, VA, 22311

Business Categories: Category Business, Not Designated a Small Business, Service Disabled Veteran Owned Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $25,002,034

Exercised Options: $25,002,034

Current Obligation: $20,956,335

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS10F0349N

IDV Type: FSS

Timeline