DoD's $37.7M consulting contract with General Dynamics IT awarded without competition, raising value-for-money questions

Contract Overview

Contract Amount: $37,682,590 ($37.7M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2016-05-10

End Date: 2020-05-10

Contract Duration: 1,461 days

Daily Burn Rate: $25.8K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::OT::IGF

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22209

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $37.7 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::OT::IGF Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. Significant duration of 4 years suggests a long-term need for these management consulting services. 3. The contract's value, while substantial, needs benchmarking against similar services to assess true value. 4. Administrative Management and General Management Consulting Services (NAICS 541611) is a broad category, requiring specific performance metrics for evaluation. 5. Lack of competition is a key risk indicator for potential overpricing and reduced service quality. 6. The contract was awarded by Washington Headquarters Services, indicating a focus on high-level administrative support within the DoD. 7. Fixed-price contract type aims to control costs, but the absence of competition undermines this benefit.

Value Assessment

Rating: questionable

The contract's value of $37.7 million over four years for administrative management consulting services is substantial. Without competitive bidding, it is difficult to benchmark the pricing against market rates or similar contracts. The absence of competition raises concerns about whether the government received the best possible value for its investment. A thorough review of the contractor's proposed pricing and the justification for the sole-source award would be necessary to fully assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. The justification for a sole-source award typically involves unique capabilities or circumstances where only one vendor can meet the requirement. The lack of competition means that potential cost savings and service improvements that could arise from a competitive bidding process were not realized. This approach limits the government's ability to explore alternative solutions and negotiate the most favorable terms.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. The government missed an opportunity to leverage market forces to secure a lower price or better service offerings.

Public Impact

The primary beneficiary is the Department of Defense, which receives administrative management and general management consulting services. These services likely support the operational efficiency and strategic planning of various DoD entities. The geographic impact is concentrated within the Washington D.C. metropolitan area, where Washington Headquarters Services is located. The contract supports a firm-fixed-price structure, indicating a defined scope of work and payment terms.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially leads to higher costs for taxpayers.
Lack of transparency in the procurement process due to non-competitive nature.
Potential for vendor lock-in given the long contract duration and lack of competitive alternatives.
Difficulty in assessing true value for money without comparative bids.

Positive Signals

General Dynamics Information Technology is a large, established contractor with significant experience in government services.
Firm-fixed-price contract type provides cost certainty for the government, assuming the scope is well-defined.
The contract duration of four years suggests a stable, ongoing need for the services provided.

Sector Analysis

The administrative management and general management consulting services sector is a significant part of the federal contracting landscape, supporting various government functions. This contract falls within the professional services category, which is characterized by a wide range of specialized expertise. The market for these services is competitive, but specific niche requirements can sometimes lead to sole-source awards. Benchmarking this contract's value against other similar consulting engagements within the federal government would provide further context on its cost-effectiveness.

Small Business Impact

This contract was not set aside for small businesses, nor does it indicate any specific subcontracting requirements for small businesses. The award to a large prime contractor like General Dynamics Information Technology suggests that the focus was on the prime's capabilities rather than fostering small business participation through this specific award. Further analysis of General Dynamics IT's subcontracting plans would be needed to understand the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of Washington Headquarters Services contracting officers and program managers. The Department of Defense Inspector General may also conduct audits or investigations into the contract's performance and financial aspects. Transparency is limited due to the sole-source nature of the award, making public scrutiny of the procurement process challenging. Accountability would be managed through performance reviews and contract deliverables.

Related Government Programs

Management and Consulting Services
Professional Services Contracts
Department of Defense Administrative Support

Risk Flags

Sole-source award
Lack of competition
Potential for overpricing
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.7 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::OT::IGF

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 (Washington Headquarters Services).

What is the total obligated amount?

The obligated amount is $37.7 million.

What is the period of performance?

Start: 2016-05-10. End: 2020-05-10.

What specific management and administrative consulting services were provided under this contract?

The contract falls under NAICS code 541611, which covers Administrative Management and General Management Consulting Services. While the specific deliverables are not detailed in the provided data, these services typically encompass areas such as organizational structure, strategic planning, process improvement, operational efficiency, and general management advice. Given the award to Washington Headquarters Services within the Department of Defense, the services likely supported high-level administrative functions, policy development, or organizational effectiveness initiatives critical to the DoD's mission. A detailed review of the contract's Statement of Work (SOW) would be necessary to ascertain the precise nature and scope of the consulting services rendered.

What was the justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT COMPETED,' signifying a sole-source award. Federal procurement regulations allow for sole-source awards under specific circumstances, such as when only one responsible source is available or capable of providing the required services, or in cases of urgent and compelling need. Without the specific justification document (often referred to as a Justification and Approval or J&A), it is impossible to determine the precise rationale. However, common reasons include unique proprietary technology, specialized expertise held by only one firm, or a critical need that cannot be met through a competitive process within the required timeframe. The absence of competition here warrants scrutiny to ensure taxpayer funds were used appropriately.

How does the $37.7 million contract value compare to similar consulting contracts within the DoD?

Benchmarking the $37.7 million contract value requires comparing it to similar administrative management and general management consulting services contracts awarded by the Department of Defense or other federal agencies. Factors such as contract duration (4 years), scope of services, and the specific agency or program supported are crucial for a meaningful comparison. Given the sole-source nature of this award, it is particularly important to assess if the pricing is competitive relative to what might have been achieved through a competitive process. Without access to a broader dataset of comparable contracts and their pricing structures, a definitive comparison is challenging. However, the substantial value suggests a significant scope of work, and the lack of competition raises a flag for potential overpricing compared to competitively bid alternatives.

What are the potential risks associated with a 4-year sole-source contract for consulting services?

A 4-year sole-source contract for consulting services presents several potential risks. Firstly, the lack of competition can lead to complacency from the contractor, potentially resulting in reduced service quality or innovation over time, as there is no immediate competitive threat. Secondly, without competitive bidding, the government may be paying a premium price, as the contractor faces less pressure to offer the most cost-effective solution. Thirdly, there is a risk of vendor lock-in, where the government becomes heavily reliant on the incumbent contractor, making it difficult and costly to switch providers in the future. Finally, the long duration might not align with evolving needs, and without periodic re-competition, the contract may not adapt to changing requirements or technological advancements.

What is the track record of General Dynamics Information Technology in providing similar services to the federal government?

General Dynamics Information Technology (GDIT) is a large and established federal contractor with a extensive track record in providing a wide range of IT and professional services to various government agencies, including the Department of Defense. They have historically secured numerous large-scale contracts for IT modernization, cybersecurity, cloud services, and management consulting. While GDIT possesses significant experience and resources, the specific performance quality and value delivered under this particular sole-source contract would depend on the detailed scope of work and performance metrics. A review of past performance evaluations and any reported issues on similar contracts would provide a more granular understanding of their capabilities and reliability in this specific service area.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: HQ003416R0212

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Qbase-Mcneil Integrated Solutions Rllp (UEI: 080141099)

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: $37,682,590

Exercised Options: $37,682,590

Current Obligation: $37,682,590

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline