Defense IT contract awarded to Northrop Grumman for $12M, with performance spanning over 4 years

Contract Overview

Contract Amount: $12,041,296 ($12.0M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2005-07-14

End Date: 2009-09-29

Contract Duration: 1,538 days

Daily Burn Rate: $7.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: 200512!004843!9700!HC1013!DEFENSE INFO. TECHNOLOGY CONTRAC!GS35F4506G !C!N! !N!HC101305F2415! !20050714!20060714!064677243!016435559!016435559!N!NORTHROP GRUMMAN INFORMATION T!7575 COLSHIRE DRIVE !MCLEAN !VA!22102!14968!540!51!CHARLOTTESVILLE !CHARLOTTESVILLE (CITY)!VIRGINIA !+000002630322!N!N!000000000000!D399!OTHER ADP & TELECOMMUNICATION SERVICES !S1 !SERVICES !000 !* !541511!E! !6! ! ! ! ! !20200930!B!E!N! ! !A! ! ! !000! ! ! ! ! ! ! !Y!C!N!N! ! ! ! ! ! !000! ! ! ! ! ! ! ! ! !0001! !

Place of Performance

Location: CHANTILLY, FAIRFAX County, VIRGINIA, 20151

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $12.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: 200512!004843!9700!HC1013!DEFENSE INFO. TECHNOLOGY CONTRAC!GS35F4506G !C!N! !N!HC101305F2415! !20050714!20060714!064677243!016435559!016435559!N!NORTHROP GRUMMAN INFORMATION T!7575 COLSHIRE DRIVE !MCLEAN !VA!22102!14968!540!51!CHARLOTTESVILLE !CHAR… Key points: 1. Contract value represents a significant investment in defense information technology services. 2. The award was made under full and open competition, suggesting a competitive bidding process. 3. The contract type is Time and Materials, which can pose cost control risks if not managed closely. 4. Northrop Grumman's extensive experience in defense contracting positions them as a capable provider. 5. The services fall under Custom Computer Programming, a critical area for modern defense operations. 6. The contract duration of over 4 years indicates a long-term need for these IT services.

Value Assessment

Rating: fair

The contract's total value of approximately $12 million over its duration is substantial for custom computer programming services. Benchmarking this against similar contracts is challenging without more specific service details. However, the Time and Materials pricing structure, while flexible, can lead to higher costs if not carefully monitored compared to fixed-price contracts. The contract was awarded to a single entity, Northrop Grumman, which is a large, established defense contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders were likely solicited and considered. The specific number of bids received is not detailed, but this procurement method generally promotes competitive pricing and allows the government to select the best value offering. The presence of a competitive process suggests that the pricing should be more aligned with market rates.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it typically drives down costs through competitive bidding, ensuring that government funds are used more efficiently.

Public Impact

The primary beneficiary is the Department of Defense, specifically the Defense Information Systems Agency (DISA), which receives critical IT services. The services delivered include custom computer programming, essential for maintaining and upgrading defense information systems. The contract is geographically focused within Virginia, with the contractor's address in McLean and a delivery location potentially in Charlottesville. This contract supports skilled IT professionals within Northrop Grumman, contributing to the defense technology workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) contract type can lead to cost overruns if not managed diligently.
Lack of specific performance metrics in the provided data makes it difficult to assess service effectiveness.
The contract's duration of over four years requires ongoing oversight to ensure continued value.
Potential for scope creep in T&M contracts if requirements are not clearly defined and controlled.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Contractor, Northrop Grumman, is a large and experienced defense contractor with a strong track record.
The contract addresses a critical need for IT services within the Department of Defense.
The contract value, while substantial, is spread over a significant period, allowing for phased delivery and payment.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on custom computer programming services for defense applications. The market for defense IT services is large and highly specialized, with significant government spending allocated to maintaining and modernizing technological infrastructure. Comparable spending benchmarks would typically involve other large-scale IT service contracts awarded by defense agencies for similar custom development work.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large contract awarded to a major defense contractor, it is unlikely to have significant direct subcontracting opportunities for small businesses unless specified within the contract's statement of work, which is not detailed here. The focus is on a large prime contractor, suggesting minimal direct impact on the small business ecosystem for this specific award.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense and the Defense Information Systems Agency (DISA). As a Time and Materials contract, rigorous monitoring of labor hours and material costs is crucial. Accountability measures would involve performance reviews and adherence to the contract's terms and conditions. Transparency is generally maintained through contract databases like FPDS, where basic award information is publicly available.

Related Government Programs

Defense Information Technology Services
Custom Computer Programming
Northrop Grumman Contracts
Department of Defense IT Spending
DISA Contracts
Time and Materials Contracts

Risk Flags

Time and Materials contract type requires close monitoring to control costs.
Potential for scope creep if requirements are not well-defined.
Long contract duration necessitates sustained oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.0 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. 200512!004843!9700!HC1013!DEFENSE INFO. TECHNOLOGY CONTRAC!GS35F4506G !C!N! !N!HC101305F2415! !20050714!20060714!064677243!016435559!016435559!N!NORTHROP GRUMMAN INFORMATION T!7575 COLSHIRE DRIVE !MCLEAN !VA!22102!14968!540!51!CHARLOTTESVILLE !CHARLOTTESVILLE (CITY)!VIRGINIA !+000002630322!N!N!000000000000!D399!OTHER ADP & TELECOMMUNICATION SERVICES !S1 !SERVICES !000 !* !541511!E! !6! ! ! ! ! !202

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 (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $12.0 million.

What is the period of performance?

Start: 2005-07-14. End: 2009-09-29.

What is Northrop Grumman's track record with similar IT contracts within the Department of Defense?

Northrop Grumman Systems Corporation has a long and extensive history of performing IT and defense-related contracts for the U.S. government, particularly the Department of Defense. They are a major defense contractor known for providing a wide range of services, including systems integration, software development, cybersecurity, and information technology support. Their track record typically involves large, complex programs requiring significant technical expertise and program management capabilities. While specific performance details for individual contracts are often not publicly disclosed in detail, their continued success in winning and executing large-scale defense contracts suggests a generally positive performance history. However, like any large contractor, they may have faced challenges or scrutiny on specific projects over their long tenure.

How does the $12 million value compare to other custom computer programming contracts awarded by DISA?

The $12 million total value for this contract, awarded over approximately four years, is a substantial but not extraordinary amount for custom computer programming services within the Department of Defense, especially when procured through a large prime contractor like Northrop Grumman. DISA frequently awards IT contracts that range from millions to hundreds of millions of dollars, depending on the scope, complexity, and duration. Contracts for custom software development, system integration, and IT modernization can easily reach these figures. To provide a precise comparison, one would need to analyze the specific services rendered and benchmark against contracts with similar statements of work, duration, and pricing structures (e.g., Time and Materials vs. Firm-Fixed-Price) awarded by DISA or other defense agencies during a comparable period.

What are the primary risks associated with a Time and Materials (T&M) contract of this nature?

The primary risk associated with Time and Materials (T&M) contracts, like this one, is the potential for cost overruns. Unlike fixed-price contracts, T&M contracts reimburse the contractor for the actual cost of labor (at specified hourly rates) and materials, plus a fee or profit. This structure provides flexibility but offers less cost certainty for the government. Risks include the contractor potentially taking longer than anticipated to complete tasks, leading to increased labor costs, or the cost of materials escalating. Effective management requires diligent oversight, detailed tracking of hours and expenses, and robust change control processes to prevent scope creep and ensure that the work performed is necessary and efficient. Without strong government oversight, T&M contracts can become significantly more expensive than initially projected.

How effective is 'full and open competition' in ensuring value for money in defense IT procurements?

Full and open competition is generally considered the most effective method for ensuring value for money in government procurements, including defense IT. By allowing all responsible sources to submit bids, it fosters a competitive environment where contractors are incentivized to offer their best prices and innovative solutions to win the contract. This competition drives down costs and improves the quality of goods and services received. However, the effectiveness can be influenced by factors such as the complexity of the requirement, the number of capable bidders, and the clarity of the solicitation. For highly specialized or niche IT requirements, the pool of potential bidders might be limited, potentially reducing the competitive pressure. Nevertheless, it remains the preferred method for maximizing taxpayer value.

What are the implications of awarding this contract to a single large contractor like Northrop Grumman?

Awarding a significant IT contract to a single large contractor like Northrop Grumman has several implications. Positively, it can streamline project management, leverage the contractor's extensive resources, expertise, and established processes, and potentially lead to faster execution due to their familiarity with defense systems and requirements. Northrop Grumman's size and experience suggest a lower risk of contractor failure. However, it also concentrates risk with one entity and may limit opportunities for smaller, innovative companies to participate directly. Furthermore, reliance on a single large contractor can sometimes lead to less competitive pricing in future procurements if the contractor gains significant institutional knowledge or market dominance. Effective oversight is crucial to ensure performance and fair pricing.

What is the historical spending trend for custom computer programming services within the Defense Information Systems Agency?

Historical spending trends for custom computer programming services within the Defense Information Systems Agency (DISA) generally show a consistent and significant investment. DISA is responsible for providing, operating, and defending information systems for the nation's warfighters and national leaders, which inherently requires substantial and ongoing expenditure on software development, system integration, and IT modernization. Spending in this category tends to fluctuate based on evolving technological needs, new defense initiatives, and the lifecycle of existing systems. While specific year-over-year figures for 'custom computer programming' alone are not always granularly reported, overall IT spending by DISA has historically been in the billions of dollars annually, with a considerable portion allocated to software development and related services to maintain and enhance critical defense capabilities.

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: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Titan II Inc.

Address: 15010 CONFERENCE CENTER DR, CHANTILLY, VA, 20151

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F4506G

IDV Type: FSS

Timeline