Navy ERP Systems Integration Support Services contract awarded to Leidos Inc. for over $31.2 million
Contract Overview
Contract Amount: $31,239,700 ($31.2M)
Contractor: Leidos Inc
Awarding Agency: Department of Defense
Start Date: 2011-01-20
End Date: 2012-01-19
Contract Duration: 364 days
Daily Burn Rate: $85.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: NAVY ENTERPRISE RESOURCE PLANNING (ERP) SYSTEMS INTEGRATION SUPPORT SERVICES
Place of Performance
Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $31.2 million to LEIDOS INC for work described as: NAVY ENTERPRISE RESOURCE PLANNING (ERP) SYSTEMS INTEGRATION SUPPORT SERVICES Key points: 1. The contract's value of over $31.2 million for a one-year period suggests a significant investment in enterprise resource planning systems. 2. The award was made under full and open competition, indicating a potentially competitive bidding process. 3. The cost-plus-fixed-fee contract type carries inherent risks of cost overruns, requiring close monitoring. 4. The duration of 364 days for a definitive contract of this magnitude warrants scrutiny of project scope and execution. 5. The North American Industry Classification System (NAICS) code 541519 points to a broad range of computer-related services, requiring specific expertise. 6. The contract's focus on ERP systems integration is critical for streamlining Navy operations and data management.
Value Assessment
Rating: fair
The contract value of $31.2 million for a single year of ERP systems integration support appears substantial. Benchmarking against similar large-scale IT integration projects within the Department of Defense or other federal agencies would be necessary for a precise value-for-money assessment. The cost-plus-fixed-fee structure, while allowing for flexibility, can lead to higher costs compared to fixed-price contracts if not managed diligently. The provided data does not offer enough detail to definitively assess if this represents excellent or questionable value without further context on the specific services rendered and their criticality.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting that multiple bidders had the opportunity to submit proposals. The presence of 3 bids indicates a degree of competition, but the exact number of bidders can influence price discovery. A higher number of bids generally leads to more competitive pricing. Without knowing the specific requirements and the number of other potential bidders who chose not to compete, it's difficult to definitively assess the intensity of the competition.
Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it promotes a more competitive bidding environment, which can drive down costs and ensure the government receives the best value for its investment.
Public Impact
The primary beneficiaries are the Department of the Navy, which will receive enhanced ERP systems integration support. The services delivered are crucial for the operational efficiency and data management capabilities of the Navy. The geographic impact is likely concentrated within Navy installations and operational areas where these ERP systems are deployed. Workforce implications may include the need for specialized IT personnel to manage and integrate the ERP systems, potentially impacting civilian and military IT staff.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can incentivize contractors to incur costs without strict adherence to budget, potentially leading to overspending.
- The broad NAICS code 541519 might indicate a wide scope of work, increasing the risk of undefined requirements or scope creep.
- A single-year definitive contract for complex ERP integration might suggest a short-term focus or a phased approach, potentially leading to integration challenges if not managed strategically.
- The lack of specific performance metrics in the provided data makes it difficult to assess the contractor's performance and the overall success of the integration effort.
Positive Signals
- Awarded under full and open competition, suggesting a robust selection process and potential for competitive pricing.
- The contract is for ERP systems integration, a critical function for modernizing and improving operational efficiency within a large organization like the Navy.
- Leidos Inc. is a well-established government contractor with experience in IT services, suggesting a degree of capability and reliability.
- The definitive contract award provides a clear framework for the services to be rendered over the specified period.
Sector Analysis
This contract falls within the Information Technology (IT) sector, specifically focusing on systems integration for enterprise resource planning (ERP) software. The market for IT services, particularly in defense and government, is substantial, with significant spending on software development, integration, and maintenance. Comparable spending benchmarks would involve looking at other large federal IT contracts, especially those related to ERP implementations in agencies like the Army, Air Force, or civilian departments. The size of this contract, over $31 million for one year, places it in the mid-to-large tier for IT service contracts.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (sb: false) and does not explicitly mention subcontracting goals for small businesses (ss: false). This suggests that the primary award went to a large business, Leidos Inc. While there are no direct set-aside provisions, large prime contractors are often encouraged or required to subcontract a portion of their work to small businesses. The absence of this information in the provided data means we cannot assess the direct impact on the small business ecosystem or the extent of their participation in this specific contract.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the relevant program management office within the Department of the Navy. Accountability measures would be defined in the contract's terms and conditions, including performance standards and reporting requirements. Transparency is generally facilitated through contract award databases like FPDS-NG, which provide public access to contract details. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected or identified during the contract's performance or closeout.
Related Government Programs
- Navy Enterprise Resource Planning (ERP) Program
- Department of Defense IT Modernization Initiatives
- Federal Civilian ERP Systems
- Defense Logistics Agency (DLA) ERP Systems
- General Services Administration (GSA) IT Schedule Contracts
Risk Flags
- Cost-Plus-Fixed-Fee contract type carries inherent cost overrun risks.
- Broad NAICS code may indicate undefined scope or potential for scope creep.
- Lack of specific performance metrics makes objective assessment difficult.
- Single-year definitive contract for complex integration may not reflect long-term strategy.
Tags
it, defense, navy, definitive-contract, full-and-open-competition, cost-plus-fixed-fee, systems-integration, enterprise-resource-planning, leidos-inc, department-of-defense, virginia, computer-related-services
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $31.2 million to LEIDOS INC. NAVY ENTERPRISE RESOURCE PLANNING (ERP) SYSTEMS INTEGRATION SUPPORT SERVICES
Who is the contractor on this award?
The obligated recipient is LEIDOS INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $31.2 million.
What is the period of performance?
Start: 2011-01-20. End: 2012-01-19.
What specific ERP systems are being integrated under this contract, and what is the scope of the integration services?
The provided data does not specify the exact ERP systems involved (e.g., SAP, Oracle, custom solutions). The scope of integration services is also not detailed but is broadly categorized under 'Other Computer Related Services' (NAICS 541519). Typically, ERP integration involves connecting various modules of an ERP system, integrating the ERP with other existing business systems (like financial, HR, or supply chain management software), data migration, customization, testing, and user training. For a contract of this value, the scope likely encompasses significant technical effort to ensure seamless data flow and process harmonization across different Navy operational units.
How does the cost-plus-fixed-fee (CPFF) structure compare to other contract types for similar IT integration projects, and what are the associated risks?
Cost-plus-fixed-fee (CPFF) contracts are often used when the scope of work is not precisely defined or is expected to evolve, providing flexibility for the contractor. However, they carry a higher risk of cost overruns for the government compared to fixed-price contracts, as the contractor is reimbursed for allowable costs plus a predetermined fixed fee. For IT integration projects, fixed-price or firm-fixed-price contracts are generally preferred when requirements are well-defined, as they offer better cost certainty. The CPFF structure here suggests that the Navy anticipated potential uncertainties in the integration process, but it necessitates rigorous oversight to manage costs effectively and prevent scope creep from inflating the final price beyond the initial estimates.
What is Leidos Inc.'s track record with large-scale ERP integration projects for the Department of Defense or similar government agencies?
Leidos Inc. is a major government contractor with extensive experience in IT services, including systems integration and enterprise solutions. They have a history of supporting various branches of the military and federal agencies with complex IT projects. While specific details on their ERP integration successes or challenges for the Navy are not provided in this data snippet, their general profile suggests they possess the technical capabilities and security clearances required for such work. A deeper dive into their past performance evaluations and project portfolios would be necessary to fully assess their specific track record relevant to this contract's requirements.
How does the $31.2 million annual spending on this contract compare to historical spending on Navy ERP systems integration?
The provided data represents a single definitive contract awarded for the period of January 20, 2011, to January 19, 2012, totaling $31,239,699.97. To compare this to historical spending, one would need access to historical contract data for Navy ERP systems integration over multiple years. This single data point suggests a significant investment in that specific year. Without a broader dataset, it's impossible to determine if this amount is higher, lower, or consistent with previous or subsequent years' spending on similar services. Analyzing trends over several fiscal years would be crucial for understanding the Navy's investment trajectory in ERP integration.
What are the key performance indicators (KPIs) used to measure the success of this ERP systems integration support contract?
The provided data does not include specific Key Performance Indicators (KPIs) for this contract. In a typical IT systems integration contract, KPIs might include metrics related to system uptime and availability, data accuracy and integrity, successful transaction processing rates, user adoption rates, reduction in processing times for key business functions, adherence to project timelines, and budget performance. For a CPFF contract, monitoring progress against defined milestones and deliverables is crucial, even if the final cost is variable. The contracting officer's representative (COR) would be responsible for tracking performance against the contract's statement of work and any established performance standards.
What are the potential risks associated with the 'Other Computer Related Services' NAICS code (541519) for a contract of this magnitude?
The NAICS code 541519, 'Other Computer Related Services,' is a broad category that encompasses a wide array of IT services beyond standard software development or network management. For a contract of this magnitude ($31.2 million), the risk lies in the potential ambiguity of the 'other' services. This could lead to scope creep, misinterpretation of requirements, or difficulties in assessing contractor performance if the specific deliverables are not clearly defined in the contract's Statement of Work (SOW). It necessitates meticulous contract management and clear communication between the government and the contractor to ensure that the services provided align precisely with the Navy's needs and expectations.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc. (UEI: 611641312)
Address: 11951 FREEDOM DR, 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: $31,239,700
Exercised Options: $31,239,700
Current Obligation: $31,239,700
Subaward Activity
Number of Subawards: 114
Total Subaward Amount: $11,293,396
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2011-01-20
Current End Date: 2012-01-19
Potential End Date: 2012-01-19 00:00:00
Last Modified: 2020-05-07
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