General Dynamics IT awarded $30.3M for IT services to combatant commands, highlighting a need for specialized support

Contract Overview

Contract Amount: $30,309,967 ($30.3M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: General Services Administration

Start Date: 2014-02-01

End Date: 2014-07-31

Contract Duration: 180 days

Daily Burn Rate: $168.4K/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- OTHER FUNCTION. COMMUNICATIONS AND IT SERVICES FOR AFRICOM, EUCOM, DJIBOUTI AND OTHER ASSOCIATED STAFF ELEMENTS.

Place of Performance

Location: PHILADELPHIA, PHILADELPHIA County, PENNSYLVANIA, 19131

State: Pennsylvania Government Spending

Plain-Language Summary

General Services Administration obligated $30.3 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::OT::IGF- OTHER FUNCTION. COMMUNICATIONS AND IT SERVICES FOR AFRICOM, EUCOM, DJIBOUTI AND OTHER ASSOCIATED STAFF ELEMENTS. Key points: 1. The contract value of $30.3 million for a 6-month period suggests a high per-diem cost for IT services. 2. Competition was full and open, indicating a potentially competitive bidding process for these services. 3. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 4. This award falls under IT services, a critical but often expensive component of military operations. 5. The duration of 180 days suggests a need for immediate and short-term IT support. 6. The awardee, General Dynamics Information Technology, is a major player in the federal IT contracting space.

Value Assessment

Rating: fair

The contract value of $30.3 million over 180 days equates to approximately $168,389 per day. This daily rate is high and warrants further investigation into the specific services provided and the labor mix. Without more granular data on the scope of work and personnel involved, it is difficult to definitively benchmark this against similar contracts. However, the Cost Plus Fixed Fee structure introduces a degree of risk regarding cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. This level of competition is generally favorable for price discovery and ensuring the government receives competitive pricing. The fact that it was competed indicates that the requirement was not unique to a single provider.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it encourages a wider range of vendors to offer their services, potentially driving down costs through competitive bidding and innovation.

Public Impact

US military personnel stationed in AFRICOM, EUCOM, and Djibouti benefit from reliable IT infrastructure and support. Essential communication and IT services are delivered to support global military operations and command functions. The geographic impact is significant, covering key operational theaters in Africa and Europe, as well as Djibouti. The contract supports a workforce of IT professionals, contributing to employment in the technology sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can incentivize contractors to increase costs to maximize profit.
The high daily burn rate suggests potential for inefficient resource allocation.
Short contract duration may indicate a lack of long-term strategic planning for IT needs.
Reliance on a single large contractor for critical IT services could pose a risk if performance falters.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
The contractor, General Dynamics Information Technology, has a significant track record in federal IT services.
The services provided are critical for supporting combatant commands, ensuring operational readiness.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer systems design and related services. The federal IT market is substantial, with agencies consistently investing in maintaining and upgrading their technological infrastructure to support diverse missions. This contract represents a portion of that spending, aimed at providing specialized support to geographically dispersed military commands.

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 stemming from a set-aside. However, as a large prime contract, General Dynamics Information Technology may engage small businesses as subcontractors, though this is not explicitly detailed in the provided data.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the General Services Administration (GSA) and the relevant components of the Department of Defense (DoD) utilizing the services. The Cost Plus Fixed Fee structure necessitates robust financial oversight to ensure costs are reasonable and allocable. Transparency would be enhanced through regular reporting requirements and potential audits by the GSA or DoD Inspector General.

Related Government Programs

DoD IT Modernization Programs
Global Communications and IT Support Contracts
Combatant Command Support Services
IT Services for Contingency Operations

Risk Flags

Cost Plus Fixed Fee contract type
High daily burn rate
Short contract duration

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $30.3 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::OT::IGF- OTHER FUNCTION. COMMUNICATIONS AND IT SERVICES FOR AFRICOM, EUCOM, DJIBOUTI AND OTHER ASSOCIATED STAFF ELEMENTS.

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $30.3 million.

What is the period of performance?

Start: 2014-02-01. End: 2014-07-31.

What specific IT services are included under this contract, and how do they support the missions of AFRICOM, EUCOM, and Djibouti?

The contract, identified by NAICS code 541512 (Computer Systems Design Services), likely encompasses a range of IT support functions. This could include network management, system administration, cybersecurity, help desk support, software installation and maintenance, and potentially hardware deployment and management. These services are crucial for enabling secure and reliable communication, data access, and operational command and control for military personnel operating in the diverse and often challenging environments of Africa and Europe, as well as the strategic location of Djibouti. The specific support ensures that deployed forces have the necessary technological infrastructure to execute their missions effectively, from intelligence gathering to logistical coordination.

How does the Cost Plus Fixed Fee (CPFF) contract type compare to other pricing arrangements for similar IT services in the federal government?

Cost Plus Fixed Fee (CPFF) contracts reimburse the contractor for allowable costs incurred, plus a fixed fee representing profit. This structure is often used when the scope of work is not precisely defined or when there is uncertainty about the costs involved, such as in research and development or complex IT integration projects. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers more flexibility but carries a higher risk of cost growth for the government if costs escalate beyond initial estimates. Fixed-Price Incentive (FPI) contracts offer a middle ground, sharing cost savings or overruns between the government and contractor. For routine IT services with well-defined scopes, FFP is often preferred for its cost certainty. The choice of CPFF here suggests a perceived need for flexibility or a complex, evolving IT requirement.

What is the typical track record of General Dynamics Information Technology (GDIT) in delivering IT services to the Department of Defense?

General Dynamics Information Technology (GDIT) is a major federal IT contractor with an extensive history of supporting the Department of Defense (DoD) across a wide array of services. They have been involved in large-scale projects related to network modernization, enterprise IT infrastructure, cybersecurity solutions, cloud migration, and mission-critical application development for various military branches and agencies. GDIT generally possesses a strong reputation for its technical capabilities and ability to manage complex programs. However, like any large contractor, they have faced scrutiny and performance reviews on specific contracts. Their extensive experience suggests a high likelihood of meeting the technical requirements, but diligent oversight is always necessary to ensure performance, cost control, and adherence to contract terms.

Given the $30.3 million award for a 180-day period, what are the potential risks associated with the contractor's performance and cost management?

The primary risk associated with this contract lies in the Cost Plus Fixed Fee (CPFF) structure and the high daily burn rate ($168,389/day). CPFF contracts can incentivize contractors to incur higher costs, as their profit is fixed regardless of the actual expenses. This necessitates robust government oversight to scrutinize allowable costs and ensure efficiency. The short duration (180 days) might also indicate a reactive or short-term need, potentially leading to rushed implementation or less strategic IT solutions. If the scope of work is not meticulously defined and managed, there's a risk of scope creep, further increasing costs without commensurate value. Ensuring adequate performance metrics and regular progress reviews are critical to mitigating these risks.

How does this contract's spending compare to historical IT service expenditures for AFRICOM and EUCOM?

Without access to historical spending data specifically for AFRICOM and EUCOM IT services, a direct comparison is not possible. However, the Department of Defense as a whole consistently represents one of the largest federal spenders on IT services, with annual expenditures often in the tens of billions of dollars. Contracts for IT support to combatant commands are essential for maintaining operational readiness and global reach. The $30.3 million for a 6-month period suggests a significant investment, likely reflecting the complexity and criticality of supporting these geographically dispersed and strategically important commands. Trends in federal IT spending generally show a continued demand for modernization, cybersecurity, and cloud services, indicating that such contract awards are likely to remain prevalent.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design 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

Solicitation ID: ID03130062

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Sterling Parent Inc. (UEI: 968838909)

Address: 15036 CONFERENCE CENTER DR, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $56,021,524

Exercised Options: $30,309,967

Current Obligation: $30,309,967

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q09BGD0055

IDV Type: GWAC

Timeline