DoD's $35.4M order to Northrop Grumman for CAF DMO FY24-25 highlights custom programming needs

Contract Overview

Contract Amount: $35,413,294 ($35.4M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2024-06-30

End Date: 2025-06-29

Contract Duration: 364 days

Daily Burn Rate: $97.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: CAF DMO ANNUAL ORDER FY24-25

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $35.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: CAF DMO ANNUAL ORDER FY24-25 Key points: 1. Value for money is difficult to assess without detailed cost breakdowns and performance metrics. 2. The contract was not competed, raising questions about potential price overruns and lack of market pressure. 3. Risk indicators include the sole-source nature of the award and the reliance on a single contractor. 4. Performance context is limited to the duration and type of contract, with no specific deliverables outlined. 5. This contract falls within the IT services sector, specifically custom computer programming. 6. The award amount represents a significant investment in specialized software development for the Air Force.

Value Assessment

Rating: questionable

Benchmarking the value of this $35.4 million order is challenging due to the lack of competitive bidding and publicly available performance data. The firm-fixed-price structure suggests a defined scope, but without comparable sole-source awards or detailed cost analysis, it's difficult to ascertain if the pricing is optimal. The per-unit cost benchmark of $97,289 (calculated as total award divided by the number of orders, assuming 1 order) is not directly comparable without understanding the nature of the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when a specific contractor possesses unique capabilities or when urgency precludes a full and open competition. The lack of competition limits the government's ability to explore alternative solutions and potentially secure more favorable pricing through a bidding process.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is less incentive for the contractor to offer competitive pricing. It also reduces transparency in the procurement process.

Public Impact

The Department of the Air Force is the primary beneficiary, receiving custom computer programming services. The services delivered are critical for the Command and Control, Communications, Computers, and Intelligence (C4I) functions, likely supporting operational readiness. The geographic impact is primarily within the Department of Defense's operational theaters, though the development work may be concentrated in specific contractor locations. Workforce implications include specialized IT professionals employed by Northrop Grumman to fulfill the contract requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in higher costs for taxpayers.
Sole-source awards can limit innovation by excluding other potential providers.
Dependence on a single contractor for critical systems poses a potential risk.
Limited public information makes it difficult to assess performance and value.

Positive Signals

Northrop Grumman is a large, established defense contractor with significant experience.
Firm-fixed-price contract type provides cost certainty for the government.
The contract duration of one year allows for annual review and potential re-competition.
The award is for essential IT services supporting military operations.

Sector Analysis

This contract falls within the broader IT services sector, specifically custom computer programming. The market for defense-related software development is substantial, with significant government spending allocated to maintaining and upgrading complex systems. Comparable spending benchmarks are difficult to establish without knowing the precise nature of the CAF DMO system, but large-scale software development contracts for the DoD often run into tens or hundreds of millions of dollars annually.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Northrop Grumman Systems Corporation is a large prime contractor. There is no explicit information regarding subcontracting plans for small businesses within this specific award notice. The absence of a set-aside suggests that the primary focus is on the prime contractor's capabilities, with potential downstream impacts on small business participation depending on Northrop Grumman's subcontracting strategy.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Air Force contracting and program management offices. Accountability measures are typically embedded within the contract terms, including performance standards and delivery schedules. Transparency is limited due to the sole-source nature and the proprietary aspects of custom software development. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Information Systems Agency (DISA) IT Services
Air Force Command and Control Systems
Department of Defense Software Development Contracts
Northrop Grumman Defense Contracts

Risk Flags

Sole-source award
Lack of competition
Limited transparency on performance metrics
Potential for cost overruns due to non-competitive nature

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $35.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. CAF DMO ANNUAL ORDER FY24-25

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $35.4 million.

What is the period of performance?

Start: 2024-06-30. End: 2025-06-29.

What specific capabilities does the CAF DMO system provide, and how critical are these to Air Force operations?

The CAF DMO (Command and Control, Communications, Computers, and Intelligence - Defense Mission Operations) system likely supports critical functions related to battlefield awareness, communication, and intelligence dissemination for the Air Force. While specific details are often classified or proprietary, such systems are fundamental to coordinating air operations, managing assets, and ensuring effective command and control during missions. The $35.4 million award suggests a significant investment in maintaining, upgrading, or developing these capabilities, underscoring their importance to operational readiness and mission success. The exact criticality would depend on the specific operational tempo and strategic importance of the missions supported by this system.

What is Northrop Grumman's track record with similar custom programming services for the Department of Defense?

Northrop Grumman Systems Corporation has a long and extensive track record of providing complex IT solutions, software development, and systems integration services to the Department of Defense and other federal agencies. They are a major defense contractor involved in numerous large-scale programs across various domains, including C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance), aerospace, and cybersecurity. Their experience with custom programming for defense applications is substantial, often involving mission-critical systems that require high levels of reliability, security, and performance. Past performance on similar contracts, while not detailed in this specific award notice, is a key factor considered in sole-source negotiations, though specific metrics for this contract are not publicly available.

How does the $35.4 million award compare to historical spending on the CAF DMO system or similar C4ISR software development?

Comparing the $35.4 million award requires understanding the historical spending trajectory for the CAF DMO system. If this is an annual order, it suggests a sustained investment level. Without access to historical contract data for this specific system, it's difficult to provide a precise comparison. However, large-scale custom software development and sustainment for critical defense systems often involve multi-year investments in the tens to hundreds of millions of dollars. For example, major C4ISR system upgrades or sustainment contracts within the DoD frequently exceed this amount annually. The firm-fixed-price nature of this delivery order suggests a defined scope for the period, making it a significant but potentially contained investment for the fiscal year.

What are the primary risks associated with a sole-source award for custom computer programming services?

The primary risks associated with a sole-source award for custom computer programming services include potential cost inefficiencies, limited innovation, and vendor lock-in. Without competitive pressure, the contractor may have less incentive to offer the most competitive pricing, potentially leading to higher costs for the government. The lack of competition also restricts the government's ability to explore alternative technological solutions or approaches that other vendors might offer. Furthermore, relying on a single vendor for critical software development can create a dependency, making it difficult and costly to switch providers in the future if performance issues arise or if better solutions become available elsewhere. There's also a risk that the contractor may not prioritize the contract if other, more lucrative opportunities exist.

What performance metrics or oversight mechanisms are typically in place for contracts of this nature?

For contracts like this, typical performance metrics often revolve around meeting defined technical specifications, adhering to delivery schedules, and maintaining system availability and reliability. Oversight is usually conducted by the contracting officer's representative (COR) and program managers within the agency. They monitor progress, review deliverables, and ensure compliance with contract terms. While specific metrics for the CAF DMO system are not detailed here, they could include uptime percentages, bug resolution times, successful deployment of new features, and adherence to cybersecurity protocols. Formal performance reviews may occur periodically throughout the contract duration.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 7575 COLSHIRE DR TOWER 1, MCLEAN, VA, 22102

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $37,366,722

Exercised Options: $35,413,294

Current Obligation: $35,413,294

Subaward Activity

Number of Subawards: 36

Total Subaward Amount: $5,832,127

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA862124DB001

IDV Type: IDC

Timeline