Interior's $38.5M IBM Contract for Application Software Support Services Awarded Under Full and Open Competition
Contract Overview
Contract Amount: $38,462,750 ($38.5M)
Contractor: International Business Machines Corporation
Awarding Agency: Department of the Interior
Start Date: 2011-08-29
End Date: 2016-09-15
Contract Duration: 1,844 days
Daily Burn Rate: $20.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 7
Pricing Type: LABOR HOURS
Sector: IT
Official Description: APPLICATION SOFTWARE SUPPORT SERVICES
Place of Performance
Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20857
State: Maryland Government Spending
Plain-Language Summary
Department of the Interior obligated $38.5 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: APPLICATION SOFTWARE SUPPORT SERVICES Key points: 1. Significant contract value of $38.5 million for application software support. 2. IBM Corporation is the sole awardee, indicating a strong incumbent relationship or specialized capability. 3. The contract spans five years, suggesting a long-term need for these services. 4. The award falls under Computer Systems Design Services (NAICS 541512).
Value Assessment
Rating: good
The contract value of $38.5 million over five years appears reasonable for comprehensive application software support services. Benchmarking against similar large-scale IT support contracts would provide a more precise assessment of value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Awarded under full and open competition, this method generally promotes competitive pricing and allows any qualified vendor to bid. The specific pricing structure (labor hours) will influence the final cost discovery.
Taxpayer Impact: Full and open competition aims to secure the best value for taxpayers by fostering a competitive bidding environment.
Public Impact
Ensures continued operation and maintenance of critical application software for the Department of the Interior. Supports departmental functions through reliable IT infrastructure and services. Potential for innovation and efficiency improvements through ongoing vendor support.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in despite initial full and open competition.
- Reliance on a single vendor (IBM) for critical software support.
- Scope creep could increase costs beyond initial projections.
Positive Signals
- Awarded through full and open competition, maximizing potential for competitive pricing.
- Long-term contract provides stability for essential IT services.
- IBM's established presence suggests a high likelihood of successful service delivery.
Sector Analysis
This contract falls within the IT services sector, specifically computer systems design. Spending in this area is substantial across federal agencies, supporting a wide range of mission-critical functions. Benchmarks for similar contracts vary widely based on scope and duration.
Small Business Impact
While awarded under full and open competition, there is no explicit indication of small business participation in this specific award. Future solicitations could include set-asides to encourage small business involvement.
Oversight & Accountability
The contract's duration and value warrant regular oversight to ensure performance standards are met and costs remain within projections. Performance metrics and regular reviews are crucial for accountability.
Related Government Programs
- Computer Systems Design Services
- Department of the Interior Contracting
- Departmental Offices Programs
Risk Flags
- Potential for cost overruns due to labor hour pricing.
- Dependence on a single vendor for critical IT support.
- Risk of scope creep impacting budget and timeline.
- Lack of explicit small business participation noted.
- Need for strong contract oversight to ensure value.
Tags
computer-systems-design-services, department-of-the-interior, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Interior awarded $38.5 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. APPLICATION SOFTWARE SUPPORT SERVICES
Who is the contractor on this award?
The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of the Interior (Departmental Offices).
What is the total obligated amount?
The obligated amount is $38.5 million.
What is the period of performance?
Start: 2011-08-29. End: 2016-09-15.
What specific application software is covered under this support contract, and what is the criticality of these applications to the Department of the Interior's mission?
The contract covers 'APPLICATION SOFTWARE SUPPORT SERVICES' without specifying the exact applications. Understanding the criticality is essential for assessing the risk associated with potential disruptions and the overall value of the support. High-criticality applications would justify a higher investment in robust support services to ensure continuous operation and data integrity.
How does the pricing structure (labor hours) compare to industry benchmarks for similar application support services, and what mechanisms are in place to control costs?
Pricing based on labor hours can be advantageous for flexibility but carries a risk of cost overruns if not managed effectively. Benchmarking against industry rates for comparable IT support roles is crucial. The Department should have robust mechanisms for tracking labor hours, validating work performed, and negotiating rates to ensure cost-effectiveness and prevent unnecessary expenditures.
What are the key performance indicators (KPIs) for this contract, and how is IBM's performance being measured and evaluated to ensure effective service delivery?
Effective service delivery relies on clearly defined KPIs such as response times, resolution rates, system uptime, and customer satisfaction. The Department of the Interior must have a rigorous performance management system in place to track IBM's adherence to these KPIs. Regular performance reviews and feedback loops are vital for identifying areas of success and addressing any performance deficiencies promptly.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design 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
Solicitation ID: D11PS18952
Offers Received: 7
Pricing Type: LABOR HOURS (Z)
Evaluated Preference: NONE
Contractor Details
Address: 6710 ROCKLEDGE DR, BETHESDA, MD, 20817
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $38,462,750
Exercised Options: $38,462,750
Current Obligation: $38,462,750
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: GS00Q09BGD0034
IDV Type: GWAC
Timeline
Start Date: 2011-08-29
Current End Date: 2016-09-15
Potential End Date: 2016-09-15 00:00:00
Last Modified: 2017-09-21
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