DoD's $20.6M computer simulation contract awarded to General Dynamics IT shows fair value with moderate competition

Contract Overview

Contract Amount: $20,630,507 ($20.6M)

Contractor: General Dynamics Information Technology Inc.

Awarding Agency: Department of Defense

Start Date: 2006-12-01

End Date: 2011-11-30

Contract Duration: 1,825 days

Daily Burn Rate: $11.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: COMPUTER SIMULATION AND CONTROL SUPPORT

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20003, UNITED STATES OF AMERICA

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $20.6 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY INC. for work described as: COMPUTER SIMULATION AND CONTROL SUPPORT Key points: 1. Contract value appears reasonable given the duration and scope of engineering services. 2. Competition was robust, suggesting a competitive bidding process likely influenced pricing. 3. Risk indicators are moderate, with no immediate red flags identified in the award. 4. Performance context is within engineering services, a common area for DoD spending. 5. Sector positioning is within defense IT services, a significant area of federal expenditure.

Value Assessment

Rating: fair

The contract's total value of $20.6 million over five years suggests an average annual spend of approximately $4.1 million. This appears to be within a reasonable range for complex engineering and simulation support services provided to a major agency like the Department of Defense. Benchmarking against similar large-scale simulation contracts is difficult without more specific service details, but the pricing does not immediately suggest overpayment.

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 bids. While the number of bidders is not specified, this procurement method generally fosters a competitive environment, which is beneficial for price discovery and ensuring the government receives competitive offers. The use of full and open competition is the government's preferred method for maximizing value.

Taxpayer Impact: Taxpayers benefit from the competitive nature of this award, as it increases the likelihood of obtaining services at a fair market price and reduces the potential for inflated costs.

Public Impact

The Department of Defense is the primary beneficiary, receiving critical computer simulation and control support. Services delivered likely enhance training, mission planning, and system development capabilities. Geographic impact is centered around DoD facilities, potentially nationwide. Workforce implications include skilled engineers and technical specialists employed by the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics makes it difficult to assess the true value delivered.
Cost-plus contract type can sometimes lead to cost overruns if not closely managed.
Contract duration of five years may not be optimal for rapidly evolving technology needs.

Positive Signals

Awarded under full and open competition, suggesting a competitive pricing environment.
Contractor is a large, established entity with significant experience in government IT.
Services provided are essential for modern defense operations and training.

Sector Analysis

This contract falls within the broader Information Technology and Engineering Services sector, specifically supporting defense applications. The federal IT services market is substantial, with significant portions dedicated to defense spending. General Dynamics Information Technology is a major player in this space, providing a wide range of solutions. Comparable spending benchmarks would depend on the specific simulation technologies and complexity, but large-scale engineering support contracts for defense are common.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The prime contractor, General Dynamics Information Technology, is a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, though large prime contractors often engage small businesses for specialized support.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. The contract type (Cost Plus Fixed Fee) necessitates close monitoring of costs and adherence to the fixed fee. Transparency is generally maintained through contract reporting mechanisms, though specific details of ongoing oversight are not publicly detailed.

Related Government Programs

Defense Simulation and Training
IT Support Services
Engineering Services
Computer Systems Design

Risk Flags

Contract duration may be lengthy for rapidly evolving technology.
Cost-plus contract type requires diligent oversight to manage costs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.6 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY INC.. COMPUTER SIMULATION AND CONTROL SUPPORT

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $20.6 million.

What is the period of performance?

Start: 2006-12-01. End: 2011-11-30.

What is the track record of General Dynamics Information Technology with similar DoD simulation contracts?

General Dynamics Information Technology (GDIT) has a long history of supporting the Department of Defense across a wide array of IT and engineering services. They are a major prime contractor for numerous complex systems, including simulation and training environments. While specific details on past simulation contracts are not provided here, GDIT's extensive experience suggests a strong capability in delivering such services. Their track record generally indicates a capacity to manage large, complex programs, though performance can vary across individual contracts. Reviewing past performance evaluations and contract awards for GDIT within the simulation and training domain would provide a more granular understanding of their specific successes and challenges.

How does the $20.6 million value compare to other DoD simulation support contracts?

The $20.6 million total contract value, spread over five years (2006-2011), averages approximately $4.1 million annually. This figure is moderate for large-scale defense IT and engineering services. Many DoD simulation and training programs involve significantly larger investments, often reaching hundreds of millions or even billions of dollars for major system development or sustainment. However, contracts for specific support functions, specialized simulation modules, or localized training systems can fall within this range. Without knowing the precise scope and complexity of the 'COMPUTER SIMULATION AND CONTROL SUPPORT' provided, a direct comparison is challenging. It suggests a focused support role rather than a comprehensive system development effort.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for simulation support?

Cost Plus Fixed Fee (CPFF) contracts, like the one awarded to General Dynamics IT, present specific risks. The primary risk for the government is that the contractor may have less incentive to control costs compared to fixed-price contracts, as all allowable costs are reimbursed. While the fixed fee provides some incentive for efficiency, there's a potential for scope creep or less rigorous cost management. For the contractor, the risk lies in accurately estimating the costs to ensure the fixed fee is profitable. Effective oversight by the government is crucial to mitigate these risks, ensuring that costs are reasonable and allocable, and that the contractor operates efficiently to achieve the defined scope within the agreed-upon fee structure.

How effective is full and open competition in ensuring value for taxpayer money in IT services?

Full and open competition is widely considered the most effective method for ensuring value for taxpayer money in IT services. By allowing all responsible sources to compete, the government maximizes the pool of potential offerors, thereby increasing the likelihood of receiving innovative solutions and competitive pricing. This process drives down costs through market forces and encourages contractors to propose their best technical approaches at the most economical prices. While it requires more upfront effort in terms of solicitation and evaluation, the long-term benefits in terms of cost savings, quality, and innovation generally outweigh the initial investment. It also promotes transparency and fairness in the procurement process.

What is the typical duration for DoD IT support contracts, and how does this contract's duration compare?

The duration for DoD IT support contracts can vary significantly based on the nature of the services. Contracts for sustainment, maintenance, or ongoing support often have longer durations, potentially including option periods, to ensure continuity. Development or specialized project-based contracts might be shorter. This contract's duration of 1825 days (5 years) is a common length for significant IT support and engineering services, allowing for substantial work to be completed and providing a degree of stability for both the government and the contractor. However, in rapidly evolving IT fields, a five-year commitment might sometimes be considered long, potentially leading to challenges in adapting to new technologies unless flexibility is built into the contract.

What does the 'Engineering Services' (NAICS 541330) classification imply for this contract?

The NAICS code 541330, 'Engineering Services,' indicates that the primary focus of this contract is on providing professional engineering expertise. This typically involves the application of engineering principles to design, develop, analyze, and test systems, products, or processes. For a computer simulation and control support contract, this classification suggests that the work likely includes activities such as system design, modeling, simulation development, performance analysis, integration, and potentially technical consulting. It implies a need for highly skilled engineers and technical professionals who can apply their knowledge to complex defense-related challenges, ensuring the simulations are accurate, reliable, and meet the DoD's operational requirements.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002406R3394

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Computer Sciences Corporation (UEI: 009581091)

Address: 3160 FAIRVIEW PARK DRIVE, FALLS CHURCH, VA, 22042

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $410,214,684

Exercised Options: $410,214,684

Current Obligation: $20,630,507

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4030

IDV Type: IDC

Timeline