DoD awards $14.5M ServiceNow BPA Call to Carahsoft, highlighting software publisher market dynamics

Contract Overview

Contract Amount: $14,541,376 ($14.5M)

Contractor: Carahsoft Technology Corp

Awarding Agency: Department of Defense

Start Date: 2023-12-01

End Date: 2026-11-30

Contract Duration: 1,095 days

Daily Burn Rate: $13.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SERVICENOW CONSOLIDATED BPA CALL

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $14.5 million to CARAHSOFT TECHNOLOGY CORP for work described as: SERVICENOW CONSOLIDATED BPA CALL Key points: 1. Value appears reasonable given the 3-year duration and firm-fixed-price structure. 2. Carahsoft's role as a reseller suggests a focus on established software distribution channels. 3. The contract is a BPA Call, indicating it's part of a larger, pre-competed agreement. 4. Performance context is limited without specific deliverables, but it supports IT infrastructure. 5. Positioned within the software publishers sector, serving defense IT needs.

Value Assessment

Rating: good

The total award value of $14.5 million over three years for a ServiceNow BPA Call suggests a moderate investment in software licensing and support. Benchmarking against similar large-scale software procurements, this value seems aligned with market rates for enterprise software solutions. The firm-fixed-price contract type provides cost certainty for the Department of Defense, indicating good value if the software meets the agency's needs effectively. Further assessment would require understanding the specific ServiceNow modules and user counts covered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, likely through a pre-existing Blanket Purchase Agreement (BPA) that itself was competitively awarded. The fact that it's a BPA Call suggests that the initial competition for the BPA established the terms and conditions. While the number of bidders for this specific call isn't provided, the underlying BPA competition likely involved multiple vendors. This approach generally promotes price discovery and ensures a competitive landscape for the government.

Taxpayer Impact: Full and open competition, even at the BPA level, is beneficial for taxpayers as it drives down prices through market forces and ensures the government accesses the best available solutions at competitive rates.

Public Impact

The Department of Defense, specifically the Defense Finance and Accounting Service, is the primary beneficiary, gaining access to ServiceNow capabilities. Services delivered likely include IT service management, workflow automation, and potentially other ServiceNow modules supporting defense operations. Geographic impact is national, supporting a federal agency with widespread operations. Workforce implications include enabling DoD personnel to utilize modern IT management tools, potentially improving efficiency and service delivery.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Reliance on a single reseller (Carahsoft) for a significant software procurement could limit direct negotiation with the software manufacturer.
The 'BPA Call' nature means the underlying BPA's terms and competition level are critical, but not detailed here.
Lack of specific performance metrics makes it difficult to assess the true value and effectiveness post-award.

Positive Signals

Awarded under full and open competition, indicating a robust initial bidding process.
Firm-fixed-price contract provides budget certainty for the government.
Carahsoft is a well-established government IT reseller with a strong track record.

Sector Analysis

This contract falls within the IT sector, specifically software publishers and IT professional services. The market for enterprise IT management software, like ServiceNow, is dominated by a few key players. Government spending on such platforms is substantial, driven by the need for efficient IT operations, cybersecurity, and digital transformation. Carahsoft Technology Corp. is a major reseller in the government IT space, often leveraging large IDIQ contracts and BPAs to provide software and services to federal agencies. This award reflects a common procurement strategy for acquiring enterprise software through established channels.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Carahsoft Technology Corp., while a significant player, is not typically categorized as a small business. The implications for small businesses would primarily be in potential subcontracting opportunities, which are not detailed in this award notice. Without specific subcontracting plans, the direct impact on the small business ecosystem from this particular BPA Call is likely minimal, though Carahsoft may engage small businesses through its broader contracting activities.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the Defense Finance and Accounting Service (DFAS) and the Department of Defense. As a BPA Call issued under a larger BPA, oversight may also be tied to the original BPA's terms and conditions. Transparency is facilitated by the public nature of contract awards, but detailed performance monitoring and accountability measures are internal to the agency. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

ServiceNow Enterprise License Agreements
DoD IT Modernization Programs
Defense Finance and Accounting Service IT Support Contracts
Software Licensing and Maintenance Contracts
General Services Administration (GSA) Schedule Contracts (potentially where the BPA originated)

Risk Flags

Potential for scope creep in future BPA calls.
Reliance on reseller may impact direct manufacturer relationship.
Effectiveness dependent on user adoption and integration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.5 million to CARAHSOFT TECHNOLOGY CORP. SERVICENOW CONSOLIDATED BPA CALL

Who is the contractor on this award?

The obligated recipient is CARAHSOFT TECHNOLOGY CORP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Finance and Accounting Service).

What is the total obligated amount?

The obligated amount is $14.5 million.

What is the period of performance?

Start: 2023-12-01. End: 2026-11-30.

What specific ServiceNow modules are included in this BPA Call, and what are their intended uses within DFAS?

The provided data does not specify the exact ServiceNow modules covered by this $14.5 million BPA Call. ServiceNow offers a wide suite of products, including IT Service Management (ITSM), IT Operations Management (ITOM), IT Business Management (ITBM), Security Operations (SecOps), and HR Service Delivery. For the Defense Finance and Accounting Service (DFAS), common uses would likely involve ITSM for managing IT incidents, problems, and changes, potentially ITOM for monitoring and managing IT infrastructure, and possibly HR Service Delivery for internal employee support workflows. Understanding the specific modules is crucial for assessing the value and necessity of the expenditure, as different modules have vastly different functionalities and costs.

How does the $14.5 million award compare to previous or similar ServiceNow procurements by the Department of Defense?

Without access to a comprehensive database of historical DoD ServiceNow procurements, a direct comparison is challenging. However, $14.5 million over three years averages to approximately $4.83 million per year. This figure is within the range expected for large federal agencies acquiring enterprise software licenses and support for platforms like ServiceNow. Agencies often negotiate enterprise-wide agreements or BPAs to achieve economies of scale. To provide a precise comparison, one would need to analyze the scope (number of users, modules) and duration of other DoD ServiceNow contracts, as well as the specific pricing negotiated under those agreements. The firm-fixed-price nature of this BPA Call suggests a defined scope and cost structure.

What are the key risks associated with this contract, and what mitigation strategies are in place?

Key risks include potential cost overruns if the scope expands beyond the initial BPA Call terms, vendor lock-in with ServiceNow, and the possibility that the software may not fully meet evolving DoD requirements. Another risk is the reliance on Carahsoft as a reseller, which might add a margin compared to direct procurement, although Carahsoft often provides value-added services. Mitigation strategies likely involve robust contract management by DFAS, clear definition of requirements within the BPA Call, regular performance reviews, and potentially leveraging the competitive nature of the underlying BPA for future calls. The firm-fixed-price structure inherently mitigates cost overrun risks for the defined scope.

What is Carahsoft Technology Corp.'s role and track record in fulfilling federal IT contracts, particularly for software like ServiceNow?

Carahsoft Technology Corp. is a prominent government IT solutions provider and reseller, holding numerous contract vehicles, including GSA Schedules and other IDIQs. They specialize in making a wide range of technology products and services accessible to federal, state, and local government agencies. Their business model often involves partnering with software manufacturers like ServiceNow and then competing for government task orders or BPA calls. Carahsoft has a well-established track record of delivering software and related services to the federal government, including significant deployments of enterprise platforms. Their experience suggests they are capable of managing the logistical and contractual aspects of such awards, often providing value-added support and licensing expertise.

How does this contract align with the Department of Defense's broader IT modernization and digital transformation goals?

This contract likely aligns with the DoD's broader IT modernization and digital transformation goals by providing a standardized platform for managing IT services and workflows. ServiceNow is widely adopted across government and industry for its ability to streamline operations, improve service delivery, and enhance data visibility. By consolidating IT management functions onto a single platform, the DoD can potentially reduce redundancies, improve efficiency, and enhance its overall IT posture. This aligns with objectives to create a more agile, secure, and data-driven defense enterprise, enabling better decision-making and resource allocation across various financial and operational units like DFAS.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HQ042323Q0060

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11493 SUNSET HILLS RD, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $14,541,376

Exercised Options: $14,541,376

Current Obligation: $14,541,376

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6600119A0120

IDV Type: BPA

Timeline