DoD's $23.4M Software/Firmware Contract with Lockheed Martin Faces Scrutiny for Lack of Competition
Contract Overview
Contract Amount: $23,424,501 ($23.4M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2016-08-30
End Date: 2020-08-31
Contract Duration: 1,462 days
Daily Burn Rate: $16.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: ''IGF::OT::IGF'' SOFTWARE/FIRMWARE CHANGE IMPLEMENTATION
Place of Performance
Location: LIVERPOOL, ONONDAGA County, NEW YORK, 13088
State: New York Government Spending
Plain-Language Summary
Department of Defense obligated $23.4 million to LOCKHEED MARTIN CORPORATION for work described as: ''IGF::OT::IGF'' SOFTWARE/FIRMWARE CHANGE IMPLEMENTATION Key points: 1. Significant spending on software/firmware implementation for defense systems. 2. Sole-source award to a major defense contractor raises competition concerns. 3. Contract duration of nearly four years suggests a substantial, ongoing need. 4. The 'Search, Detection, Navigation, Guidance...' NAICS code indicates critical defense capabilities.
Value Assessment
Rating: questionable
The contract's Cost Plus Fixed Fee (CPFF) structure can lead to cost overruns if not managed tightly. Without competitive bidding, it's difficult to assess if the $23.4M price represents fair value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there was no market pressure to offer the best price.
Taxpayer Impact: The lack of competition on this $23.4M contract means taxpayers may have paid a premium, as the government did not explore potentially lower-cost alternatives.
Public Impact
Impacts critical defense navigation and guidance systems. Potential for increased costs due to sole-source award. Raises questions about the effectiveness of competitive sourcing in defense procurement. Long contract duration suggests sustained reliance on this specific solution.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing
Positive Signals
- Awarded to a known, capable defense contractor
- Addresses critical defense system needs
Sector Analysis
This contract falls within the Defense sector, specifically related to IT and systems integration for critical navigation and guidance equipment. Defense IT spending is substantial, and sole-source awards in this area warrant close examination.
Small Business Impact
The contract was awarded to Lockheed Martin Corporation, a large prime contractor. There is no indication of small business participation in this specific award, suggesting missed opportunities for smaller innovative firms.
Oversight & Accountability
The 'NOT COMPETED' status and CPFF contract type suggest a need for robust oversight from the Defense Contract Management Agency (DCMA) to ensure cost control and prevent waste, fraud, and abuse.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award lacks competitive pricing.
- Cost-plus contract type increases risk of cost overruns.
- Limited transparency on justification for non-competition.
- Potential for contractor profit inflation without market pressure.
- Missed opportunities for small business innovation.
Tags
search-detection-navigation-guidance-aer, department-of-defense, ny, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $23.4 million to LOCKHEED MARTIN CORPORATION. ''IGF::OT::IGF'' SOFTWARE/FIRMWARE CHANGE IMPLEMENTATION
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $23.4 million.
What is the period of performance?
Start: 2016-08-30. End: 2020-08-31.
What specific justification was provided for not competing this significant software/firmware contract, and were alternative solutions considered?
The provided data states 'NOT COMPETED' without further justification. A thorough review would require access to the contract file to understand the rationale, such as urgency, unique capabilities, or existing system integration requirements that precluded competition. Without this, it's difficult to assess if taxpayer funds were used efficiently.
How does the Cost Plus Fixed Fee (CPFF) structure for this $23.4M contract ensure cost efficiency and prevent contractor overruns, especially given the sole-source nature?
CPFF contracts aim to control costs by setting a fixed fee for the contractor's profit, incentivizing them to manage the cost base efficiently. However, in a sole-source scenario, the government's ability to benchmark costs is limited. Robust oversight and detailed cost analysis by the DCMA are crucial to ensure the 'cost' portion remains reasonable and doesn't inflate due to lack of competitive pressure.
What is the long-term strategic value and potential for obsolescence of the 'IGF::OT::IGF' software/firmware implemented under this contract, and were future-proofing considerations addressed?
The contract duration of 1462 days (approx. 4 years) suggests a significant, ongoing need for this software/firmware. Understanding its role in critical navigation and guidance systems is key. However, without details on the technology's roadmap or upgrade paths, there's a risk of obsolescence or the need for future sole-source extensions, potentially leading to continued higher costs.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: M6785416R6005
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp
Address: 497 ELECTRONICS PKWY BLDG 5, LIVERPOOL, NY, 13088
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $28,028,572
Exercised Options: $23,911,360
Current Obligation: $23,424,501
Actual Outlays: $131,076
Subaward Activity
Number of Subawards: 13
Total Subaward Amount: $934,663
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2016-08-30
Current End Date: 2020-08-31
Potential End Date: 2020-08-31 00:00:00
Last Modified: 2023-07-27
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