DoD's $12.3M IT Services Contract with Accenture Faces Scrutiny for Value and Competition

Contract Overview

Contract Amount: $12,325,759 ($12.3M)

Contractor: Accenture Federal Services LLC

Awarding Agency: Department of Defense

Start Date: 2024-11-21

End Date: 2026-05-20

Contract Duration: 545 days

Daily Burn Rate: $22.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: IT

Official Description: SERVICES CONTRACT TO PROVIDE THE FOLLOWING CLOUD BASED AND HYBRID CONNECTED IT SERVICES: OPERATION, MANAGEMENT, DEPLOYMENT, EXPANSION, CONTRACTION, SOFTWARE PURCHASING, LICENSE RENEWAL, PATCHING, SECURING, INFORMATION ASSURANCE, AND CONSULTATION.

Place of Performance

Location: EGLIN AFB, OKALOOSA County, FLORIDA, 32542

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $12.3 million to ACCENTURE FEDERAL SERVICES LLC for work described as: SERVICES CONTRACT TO PROVIDE THE FOLLOWING CLOUD BASED AND HYBRID CONNECTED IT SERVICES: OPERATION, MANAGEMENT, DEPLOYMENT, EXPANSION, CONTRACTION, SOFTWARE PURCHASING, LICENSE RENEWAL, PATCHING, SECURING, INFORMATION ASSURANCE, AND CONSULTATION. Key points: 1. The contract's value proposition is unclear without detailed performance metrics and cost breakdowns. 2. Full and open competition was utilized, suggesting a potentially competitive pricing environment. 3. Risk indicators are moderate, with a focus on IT service delivery and information assurance. 4. Performance context is limited, relying on the contractor's ability to manage complex cloud and hybrid IT services. 5. This contract falls within the broader IT services sector, supporting defense operations.

Value Assessment

Rating: fair

Benchmarking this $12.3 million IT services contract against similar Department of Defense procurements is challenging without specific service level agreements and performance data. The Cost No Fee (CNF) contract type suggests the government is bearing the cost of performance, which can sometimes lead to less price sensitivity from the contractor if not managed rigorously. Further analysis of Accenture Federal Services LLC's historical performance on similar contracts and a detailed breakdown of costs against deliverables would be necessary to definitively assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. While the number of bidders is not specified, this procurement method generally fosters a competitive environment, which can lead to more favorable pricing and innovative solutions for the government. The use of full and open competition suggests that the Department of the Air Force sought to maximize market participation.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing and a wider range of solutions due to the broad solicitation approach.

Public Impact

The Department of Defense, specifically the Department of the Air Force, is the primary beneficiary, receiving essential IT services. Services include cloud-based and hybrid IT operations, management, deployment, expansion, contraction, software purchasing, license renewal, patching, securing, information assurance, and consultation. The geographic impact is primarily within Florida, where the contract is managed. Workforce implications may include the need for specialized IT personnel within the Air Force to manage and integrate these services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed performance metrics makes value assessment difficult.
Cost No Fee (CNF) contract type requires diligent oversight to prevent cost overruns.
Dependence on a single contractor for critical IT infrastructure poses a risk if performance falters.

Positive Signals

Awarded under full and open competition, suggesting a robust bidding process.
Accenture Federal Services LLC is a large, established contractor with significant experience in IT services.
The contract duration provides a stable period for service delivery and integration.

Sector Analysis

This contract operates within the expansive IT services sector, which is a critical component of modern defense operations. The market for cloud-based and hybrid IT solutions is highly competitive, with numerous large and small businesses vying for government contracts. Spending in this area has been steadily increasing as agencies modernize their infrastructure. Comparable spending benchmarks would typically involve analyzing IT service contracts of similar scope and duration awarded by other federal agencies.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. The primary awardee, Accenture Federal Services LLC, is a large business. This means that opportunities for small businesses to participate in this specific contract are limited unless they are part of a subcontracting plan not detailed here. The overall impact on the small business IT ecosystem for this particular award is minimal.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Air Force contracting and program management offices. Accountability measures will be tied to the performance metrics and deliverables outlined in the contract. Transparency is facilitated by the contract's award under full and open competition, making the process publicly visible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Information Systems Agency (DISA) IT Services
Air Force Cloud Computing Strategy
General Services Administration (GSA) IT Schedule Contracts
Federal Risk and Authorization Management Program (FedRAMP)

Risk Flags

Potential for cost overruns due to CNF contract type.
Dependence on contractor performance for critical IT functions.
Cybersecurity risks inherent in cloud and hybrid IT environments.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.3 million to ACCENTURE FEDERAL SERVICES LLC. SERVICES CONTRACT TO PROVIDE THE FOLLOWING CLOUD BASED AND HYBRID CONNECTED IT SERVICES: OPERATION, MANAGEMENT, DEPLOYMENT, EXPANSION, CONTRACTION, SOFTWARE PURCHASING, LICENSE RENEWAL, PATCHING, SECURING, INFORMATION ASSURANCE, AND CONSULTATION.

Who is the contractor on this award?

The obligated recipient is ACCENTURE FEDERAL SERVICES LLC.

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 $12.3 million.

What is the period of performance?

Start: 2024-11-21. End: 2026-05-20.

What is Accenture Federal Services LLC's track record with similar large-scale IT service contracts for the Department of Defense?

Accenture Federal Services LLC has a substantial history of performing IT services for the Department of Defense and other federal agencies. They are known for their capabilities in cloud migration, cybersecurity, and enterprise IT management. While specific details of past performance on contracts of this exact scope and value are not publicly detailed in this summary, their general profile suggests they possess the resources and expertise to handle complex IT operations. However, a deeper dive into past performance reviews, contract termination history, and client feedback would be necessary for a comprehensive assessment of their reliability and effectiveness in delivering these specific cloud-based and hybrid IT services.

How does the $12.3 million cost compare to similar IT service contracts awarded by the Air Force or DoD?

Comparing the $12.3 million cost directly is difficult without knowing the precise scope, duration, and service level agreements (SLAs) of comparable contracts. IT service contracts can vary widely in price based on the complexity of the systems managed, the level of support required, and the specific technologies employed. Given that this contract covers a broad range of IT services including operation, management, deployment, expansion, contraction, software purchasing, licensing, patching, security, and consultation over a period of approximately 1.5 years (from May 2024 to May 2026), the cost appears to be within a reasonable range for a large federal agency. However, a detailed cost-benefit analysis and benchmarking against contracts with identical or very similar service offerings would be required for a definitive value assessment.

What are the primary risks associated with this contract, and how are they being mitigated?

The primary risks associated with this contract include potential performance shortfalls in delivering complex cloud and hybrid IT services, cybersecurity vulnerabilities, and cost overruns if not managed effectively under the Cost No Fee (CNF) structure. Mitigation strategies would typically involve robust contract oversight by the Department of the Air Force, including regular performance reviews, adherence to strict security protocols, and detailed financial monitoring. The use of full and open competition aims to mitigate risks by selecting a capable contractor. Furthermore, the contract's defined period and scope help manage expectations and potential scope creep. Clear communication channels and defined escalation procedures are also crucial for addressing issues promptly.

How effective is the 'full and open competition' approach in ensuring the best value for taxpayers on this IT services contract?

The 'full and open competition' approach is generally considered the most effective method for ensuring the best value for taxpayers on IT services contracts. By allowing all responsible sources to bid, it fosters a competitive environment that can drive down prices, encourage innovation, and lead to the selection of the most capable contractor. This broad solicitation increases the likelihood that the government receives high-quality services at a fair market price. However, the ultimate effectiveness depends on the clarity of the solicitation requirements, the evaluation criteria used, and the diligence of the contracting officers in assessing proposals. Without knowing the number of bidders or the specific evaluation process, it's hard to definitively state the value achieved, but the method itself is sound.

What is the historical spending pattern for similar IT services within the Department of the Air Force?

Historical spending patterns for IT services within the Department of the Air Force (and the broader DoD) show a consistent and significant investment in modernizing and maintaining its technological infrastructure. There has been a pronounced shift towards cloud computing and hybrid solutions to enhance agility, scalability, and cost-efficiency. Spending in areas like IT operations, management, cybersecurity, and cloud services has been substantial, often involving multi-year contracts with large, established IT providers. While the specific amount for this $12.3 million contract is a single data point, it aligns with the general trend of significant federal investment in IT modernization to support mission objectives. Analyzing aggregated spending data over several fiscal years would reveal trends in contract types, service areas, and major awardees.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - STORAGE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: Novetta Solutions, LLC

Address: 800 N GLEBE RD STE 300, ARLINGTON, VA, 22203

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: $57,714,712

Exercised Options: $49,062,835

Current Obligation: $12,325,759

Subaward Activity

Number of Subawards: 6

Total Subaward Amount: $1,920,259

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA865622DA040

IDV Type: IDC

Timeline