DoD's $32.6M Computer Systems Design contract with Deloitte shows fair value, but limited competition raises concerns

Contract Overview

Contract Amount: $32,592,064 ($32.6M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Defense

Start Date: 2011-03-23

End Date: 2017-03-23

Contract Duration: 2,192 days

Daily Burn Rate: $14.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IMPLEMENTATION

Place of Performance

Location: CHAMBERSBURG, FRANKLIN County, PENNSYLVANIA, 17201

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $32.6 million to DELOITTE CONSULTING LLP for work described as: IMPLEMENTATION Key points: 1. The contract awarded to Deloitte Consulting LLP for computer systems design services represents a significant investment. 2. Competition was limited, raising questions about potential price discovery and taxpayer value. 3. The firm fixed-price contract type aims to control costs, but the lack of broad competition is a risk. 4. This spending falls within the IT sector, specifically computer systems design.

Value Assessment

Rating: fair

The contract's value of $32.6 million over six years is substantial. Benchmarking against similar computer systems design contracts is difficult without more specific service details, but the price appears within a reasonable range for complex IT implementation projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a limited competitive field. This method may not have yielded the best possible price or innovative solutions compared to a broader competition.

Taxpayer Impact: The limited competition could mean taxpayers did not receive the most cost-effective solution. While the firm fixed-price contract provides cost certainty, the initial price might have been higher due to restricted market engagement.

Public Impact

Defense Information Systems Agency (DISA) relies on this contract for critical IT implementation. The duration of the contract (2192 days) suggests a long-term need for these services. The lack of small business participation is noted, potentially missing opportunities for smaller, innovative firms.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition
No small business participation
Long contract duration

Positive Signals

Firm fixed-price contract type
Awarded by a major agency (DoD)

Sector Analysis

This contract falls under the Information Technology (IT) sector, specifically computer systems design services. Spending in this area is crucial for modernizing government operations, but often involves high costs and complex requirements.

Small Business Impact

The contract explicitly states 'sb': false, indicating no small business participation. This suggests that larger, established firms dominated the bidding process, potentially limiting opportunities for smaller businesses to contribute to this significant IT project.

Oversight & Accountability

The contract was awarded by the Department of Defense (DoD) through the Defense Information Systems Agency (DISA), implying established oversight mechanisms. However, the limited competition aspect warrants further scrutiny to ensure accountability and value for taxpayer money.

Related Government Programs

Computer Systems Design Services
Department of Defense Contracting
Defense Information Systems Agency Programs

Risk Flags

Limited competition
No small business participation
Potential for vendor lock-in
Lack of detailed performance metrics for public review

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.6 million to DELOITTE CONSULTING LLP. IMPLEMENTATION

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $32.6 million.

What is the period of performance?

Start: 2011-03-23. End: 2017-03-23.

What specific factors led to the exclusion of sources, and could a broader competition have yielded better value?

The exclusion of sources suggests specific technical requirements or prior performance considerations may have narrowed the field. However, without detailed documentation, it's difficult to ascertain if these exclusions were fully justified or if a more inclusive approach could have stimulated greater competition and potentially secured a more advantageous price for the government.

How does the performance of Deloitte Consulting LLP on this contract compare to industry benchmarks for similar IT implementation projects?

Assessing performance against industry benchmarks requires detailed metrics on project milestones, budget adherence, and quality of deliverables. While the contract value is known, specific performance data is not provided. A review of past performance reviews and any contract modifications would be necessary to evaluate if Deloitte met or exceeded expectations.

What is the long-term strategic impact of relying on a single vendor for such a critical IT implementation over a six-year period?

Long-term reliance on a single vendor can lead to vendor lock-in, reduced flexibility, and potentially higher costs over time as competition diminishes. While it can ensure continuity and deep expertise, it also poses risks if the vendor's strategic direction diverges from the agency's needs or if innovative alternatives emerge.

Industry Classification

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

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: HC102810R2044

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte LLP (UEI: 014127109)

Address: 1725 DUKE ST, ALEXANDRIA, VA, 22314

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $32,592,064

Exercised Options: $32,592,064

Current Obligation: $32,592,064

Subaward Activity

Number of Subawards: 9

Total Subaward Amount: $5,378,466

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline