DoD's $39.2M AVIPSS VI contract awarded to Northrop Grumman for custom programming services
Contract Overview
Contract Amount: $39,215,669 ($39.2M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2017-01-03
End Date: 2018-12-15
Contract Duration: 711 days
Daily Burn Rate: $55.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: IGF::OT::IGF AUTOMATED VIRTUAL INFORMATION PRODUCTION SUPPORT SYSTEM VI (AVIPSS VI)
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $39.2 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: IGF::OT::IGF AUTOMATED VIRTUAL INFORMATION PRODUCTION SUPPORT SYSTEM VI (AVIPSS VI) Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 3. The duration of 711 days indicates a significant, medium-term project. 4. The contract was awarded as a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract. 5. Northrop Grumman, a large defense contractor, is the awardee. 6. The contract falls under the Custom Computer Programming Services NAICS code.
Value Assessment
Rating: fair
The total award amount of $39.2 million for custom computer programming services over approximately two years appears within a reasonable range for a project of this scope and complexity, especially given the contractor's experience. However, the Cost Plus Fixed Fee (CPFF) contract type introduces inherent risk. CPFF contracts reimburse the contractor for allowable costs plus a fixed fee, which can incentivize cost overruns if not rigorously monitored. Benchmarking against similar large-scale custom software development contracts for the Department of Defense would be necessary for a more precise value assessment. Without specific performance metrics or detailed cost breakdowns, it's difficult to definitively assess value for money.
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 bids. The specific number of bidders is not provided, but the designation suggests a robust competitive environment. Full and open competition is generally expected to yield the best prices and terms for the government by encouraging multiple companies to vie for the contract. The use of a Delivery Order implies this was likely competed as part of a broader IDIQ vehicle.
Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing and the assurance that the government sought the best available solution through a transparent process.
Public Impact
The primary beneficiaries are the Department of Defense, specifically the Air Force, which receives automated virtual information production support. The services delivered are custom computer programming, likely involving software development, integration, or maintenance. The geographic impact is primarily within the United States, supporting military operations. Workforce implications may include employment for software developers, engineers, and project managers at Northrop Grumman and potentially its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type can lead to higher costs if not managed effectively.
- Lack of specific details on the number of bidders limits the assessment of competitive intensity.
- The 'Automated Virtual Information Production Support System VI' name is vague and requires further detail to understand its criticality and scope.
Positive Signals
- Awarded through full and open competition, indicating a competitive process.
- Northrop Grumman is a well-established defense contractor with significant experience.
- The contract duration suggests a substantial and potentially critical system.
Sector Analysis
This contract falls within the Information Technology (IT) sector, specifically custom computer programming services. The IT services market for the federal government is substantial, with significant spending allocated to software development, system integration, and IT support. Contracts like AVIPSS VI are crucial for maintaining and modernizing the technological infrastructure of defense agencies. Comparable spending benchmarks would involve analyzing other large-scale custom software development contracts awarded by the DoD or other federal agencies for similar types of systems.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses arising from a set-aside provision. However, as a large prime contractor, Northrop Grumman may choose to subcontract portions of this work to small businesses, which would be a positive development for the small business ecosystem. The extent of such subcontracting is not detailed in the provided data.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the program management office within the Department of the Air Force. Northrop Grumman, as a major defense contractor, is subject to various oversight mechanisms, including audits and performance reviews. The Cost Plus Fixed Fee structure necessitates close monitoring of costs and performance to ensure value for money and prevent overruns. The Inspector General's office for the Department of Defense may also conduct audits or investigations related to this contract if concerns arise.
Related Government Programs
- Defense IT Modernization Programs
- Custom Software Development Services
- Information Systems Support Contracts
- Air Force IT Procurement
Risk Flags
- Cost Plus Fixed Fee contract type carries inherent cost overrun risk.
- Lack of detailed performance metrics makes value assessment difficult.
- Vague system name hinders understanding of project scope and impact.
Tags
it, defense, department-of-defense, air-force, custom-computer-programming-services, cost-plus-fixed-fee, delivery-order, full-and-open-competition, northrop-grumman, large-contractor, software-development, information-systems
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $39.2 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. IGF::OT::IGF AUTOMATED VIRTUAL INFORMATION PRODUCTION SUPPORT SYSTEM VI (AVIPSS VI)
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 $39.2 million.
What is the period of performance?
Start: 2017-01-03. End: 2018-12-15.
What is the specific function and criticality of the AVIPSS VI system?
The provided data offers limited insight into the specific functions and criticality of the 'Automated Virtual Information Production Support System VI (AVIPSS VI)'. The name suggests it relates to the automated generation or production of virtual information, potentially for intelligence, operational planning, or administrative purposes within the Department of the Air Force. Without further documentation, such as the Statement of Work (SOW) or contract award justification, its precise role, the data it processes, and its impact on military operations remain unclear. Understanding its criticality is essential for assessing the risk associated with its performance and the value derived from the $39.2 million investment.
How did Northrop Grumman's proposed costs compare to other bidders in the full and open competition?
The provided data does not include details on the number of bidders or their proposed costs, which prevents a direct comparison. While the contract was awarded under 'full and open competition,' indicating a competitive process, the specific pricing dynamics are not revealed. To assess value for money, one would need to analyze the competitive range, the government's cost estimates, and how Northrop Grumman's final negotiated price (including fee) aligned with those benchmarks. The absence of this information limits the ability to definitively state whether the government achieved optimal pricing through this competition.
What are the key performance metrics and deliverables for AVIPSS VI, and how has Northrop Grumman performed against them?
The provided data does not specify the key performance metrics (KPIs) or deliverables associated with the AVIPSS VI contract. Performance assessment would require access to contract performance reports, quality assurance surveillance plans (QASPs), or other contract administration documentation. Given the Cost Plus Fixed Fee (CPFF) nature of the contract, rigorous oversight of performance against defined metrics is crucial to ensure the contractor is meeting requirements and delivering value. Without these details, it is impossible to evaluate Northrop Grumman's performance or the overall effectiveness of the system.
What is the historical spending trend for AVIPSS or similar virtual information production systems within the Department of Defense?
The provided data pertains to a single contract award for AVIPSS VI. To establish historical spending trends, one would need to access historical contract databases (e.g., FPDS) to identify previous AVIPSS contracts (I, II, III, etc.) or similar systems within the DoD. Analyzing the award amounts, durations, and contractors for these prior systems would reveal trends in spending, technological evolution, and potential cost efficiencies or escalations over time. This context is vital for understanding if the $39.2 million for AVIPSS VI represents an increase, decrease, or stable level of investment in this capability.
What are the potential risks associated with the Cost Plus Fixed Fee (CPFF) contract type for this specific project?
The primary risk with a CPFF contract is the potential for cost growth, as the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee. This structure can reduce the contractor's incentive to control costs, especially if oversight is insufficient. For AVIPSS VI, risks include scope creep, inefficient resource allocation, and potential overcharging if cost accounting and auditing processes are not robust. The government must diligently monitor expenditures, validate costs, and ensure the fixed fee adequately compensates the contractor for the agreed-upon scope and risk without incentivizing unnecessary spending.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 2340 DULLES CORNER BLVD, HERNDON, VA, 20171
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $40,142,868
Exercised Options: $40,142,868
Current Obligation: $39,215,669
Subaward Activity
Number of Subawards: 173
Total Subaward Amount: $68,544,792
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA873214D0028
IDV Type: IDC
Timeline
Start Date: 2017-01-03
Current End Date: 2018-12-15
Potential End Date: 2018-12-15 00:00:00
Last Modified: 2018-09-20
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