DoD's $30.9M contract for information management services awarded to Group W Inc. raises value and competition questions

Contract Overview

Contract Amount: $30,918,982 ($30.9M)

Contractor: Group W Inc

Awarding Agency: Department of Defense

Start Date: 2023-02-23

End Date: 2026-03-21

Contract Duration: 1,122 days

Daily Burn Rate: $27.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: LABOR HOURS

Sector: IT

Official Description: MAINTAIN INFORMATION MANAGEMENT AND ANALYSIS GROUP (IMAG) PROJECT PROCESS

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20301

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $30.9 million to GROUP W INC for work described as: MAINTAIN INFORMATION MANAGEMENT AND ANALYSIS GROUP (IMAG) PROJECT PROCESS Key points: 1. The contract's value appears high relative to the number of bidders and the services provided. 2. Limited competition may have impacted pricing and overall value for the taxpayer. 3. The use of a definitive contract with labor hours introduces potential for cost overruns. 4. Performance context is limited, making it difficult to assess the effectiveness of the services. 5. This contract falls within the IT services sector, specifically custom computer programming. 6. The geographic location is Washington D.C., a hub for federal contracting.

Value Assessment

Rating: questionable

The contract's total value of $30.9 million for custom computer programming services seems substantial, especially given the limited competition. Benchmarking against similar contracts for information management and analysis group (IMAG) projects is difficult without more specific service details. However, the use of labor hours (pt: LABOR HOURS) can sometimes lead to higher costs compared to fixed-price contracts if not managed tightly. The contract's duration of 1122 days (approximately 3 years) suggests a significant investment, and the value-for-money proposition needs closer scrutiny to ensure efficient use of federal funds.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which is an unusual designation suggesting that while open competition was intended, certain sources were excluded. This typically implies a more restricted bidding process than full and open competition. With only two bidders (no: 2), the level of competition was low. This limited competition may have resulted in a higher price than what could have been achieved in a more robustly contested procurement.

Taxpayer Impact: The limited number of bidders suggests that taxpayers may not have received the most competitive pricing available. The exclusion of sources further raises concerns about whether the government explored all potential avenues for cost savings.

Public Impact

The Department of Defense (DoD) is the primary beneficiary, receiving information management and analysis support. The services delivered are custom computer programming, aimed at enhancing the IMAG project. The contract's geographic impact is concentrated in Washington D.C. (st: DC). The contract supports the IT sector workforce, likely involving skilled programmers and analysts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition could lead to inflated prices.
The 'after exclusion of sources' clause warrants further investigation into the rationale.
Labor hour contracts can be prone to cost overruns if not meticulously monitored.
Lack of detailed performance metrics makes assessing contractor effectiveness challenging.

Positive Signals

The contract is awarded to a specific entity, Group W Inc., indicating a clear point of accountability.
The contract duration is defined, providing a clear timeframe for service delivery.
The contract falls under a specific NAICS code (541511), indicating specialized IT services.

Sector Analysis

This contract falls within the Information Technology (IT) services sector, specifically custom computer programming services (NAICS code 541511). This sector is characterized by high demand for specialized skills and continuous innovation. Federal spending in IT services is substantial, with agencies constantly seeking to upgrade systems, manage data, and enhance cybersecurity. Comparable spending benchmarks for custom programming services vary widely based on complexity, duration, and contractor expertise, but a $30.9 million contract over three years for a specific project like IMAG suggests a significant undertaking within the DoD's IT infrastructure.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (sb: false). There is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific contract appears minimal, and it does not contribute to meeting small business contracting goals unless subcontracting opportunities are pursued by the prime contractor.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and program management offices. Accountability measures are typically embedded in the contract terms, including performance standards and payment schedules. Transparency could be enhanced by making detailed performance reports and cost breakdowns publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense IT Modernization Programs
Information Management Systems Contracts
Custom Software Development Services
Federal IT Services Procurement

Risk Flags

Limited competition raises concerns about price.
Labor hour contract type increases risk of cost overruns.
Exclusion of sources in competition needs justification.
Lack of detailed performance metrics hinders value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.9 million to GROUP W INC. MAINTAIN INFORMATION MANAGEMENT AND ANALYSIS GROUP (IMAG) PROJECT PROCESS

Who is the contractor on this award?

The obligated recipient is GROUP W INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Washington Headquarters Services).

What is the total obligated amount?

The obligated amount is $30.9 million.

What is the period of performance?

Start: 2023-02-23. End: 2026-03-21.

What is the specific nature of the 'information management and analysis group (IMAG) project' and how does Group W Inc.'s work contribute to its objectives?

The provided data does not detail the specific objectives or scope of the Information Management and Analysis Group (IMAG) project. The contract (d: MAINTAIN INFORMATION MANAGEMENT AND ANALYSIS GROUP (IMAG) PROJECT PROCESS) indicates that Group W Inc. is responsible for 'Custom Computer Programming Services' (nd: Custom Computer Programming Services) under NAICS code 541511. This suggests their role involves developing or maintaining software and systems related to information management and analysis processes within the Department of Defense. Without further documentation, the precise contribution to IMAG's overall mission remains unclear, but it likely involves enhancing data processing, storage, retrieval, or analytical capabilities to support DoD operations.

Can the pricing of this contract be benchmarked against similar custom computer programming services procured by the federal government?

Benchmarking the pricing of this $30.9 million contract against similar custom computer programming services is challenging without more granular data on the specific tasks, skill levels required, and deliverables. The contract uses 'LABOR HOURS' (pt: LABOR HOURS), which makes direct comparison difficult as rates can vary significantly. However, the limited competition (no: 2) and the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' (ct: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES) award type suggest that the pricing might not be as competitive as it could be in a broader market. To perform a robust benchmark, one would need to compare the average hourly rates for specific labor categories (e.g., senior software engineer, database administrator) against government-wide contract vehicles or publicly available data for similar DoD IT projects.

What are the potential risks associated with using a definitive contract with labor hours for this type of service?

The primary risks associated with using a definitive contract with labor hours for custom computer programming services include potential cost overruns and a lack of defined scope leading to scope creep. Since payment is based on hours worked rather than fixed deliverables, there's an incentive for longer task durations if not managed effectively. This necessitates rigorous oversight from the Department of Defense to ensure that hours are reasonable, necessary, and aligned with project milestones. Without clear performance metrics and diligent monitoring, the total cost could exceed the initial $30.9 million estimate. Additionally, defining and controlling the scope of custom development under a labor-hour contract can be more complex than with fixed-price arrangements.

How does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' procurement method impact the overall value and fairness of the contract award?

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' (ct: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES) procurement method is unusual and suggests a departure from standard full and open competition. While it implies an attempt at broad solicitation, the explicit exclusion of certain sources raises questions about the rationale behind these exclusions and whether they were justified. This limitation on the pool of potential bidders inherently reduces competition. With only two bidders (no: 2) participating, the government may not have received the most advantageous pricing or the widest range of innovative solutions. The fairness of the award could be questioned if the exclusions were not based on objective criteria, potentially limiting taxpayer value.

What is Group W Inc.'s track record with federal contracts, particularly within the Department of Defense?

The provided data identifies Group W Inc. (co: GROUP W INC) as the contractor for this $30.9 million Department of Defense (ag: Department of Defense) contract. However, the data does not include information on Group W Inc.'s past performance, contract history, or track record with federal agencies. To assess their reliability and experience, further research would be required, potentially through databases like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS), to review past contract awards, performance evaluations, and any history of disputes or issues.

What are the historical spending patterns for similar information management and analysis services within the Department of Defense?

The provided data does not offer historical spending patterns for similar services within the Department of Defense. To analyze this, one would need to query federal procurement databases for contracts awarded under relevant NAICS codes (e.g., 541511 for Custom Computer Programming Services) or Product Service Codes (PSC) related to information management and analysis, specifically for the DoD over several fiscal years. This would allow for the identification of trends in contract values, durations, award types, and the number of bidders, providing context for the current $30.9 million contract and assessing whether it aligns with historical spending or represents an anomaly.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: HQ003423R0017

Offers Received: 2

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 2650 PARK TOWER DR, VIENNA, VA, 22180

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

Financial Breakdown

Contract Ceiling: $68,522,689

Exercised Options: $32,152,171

Current Obligation: $30,918,982

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline