Leidos Inc. awarded $61M DoD contract for computer systems design, highlighting significant IT services spending
Contract Overview
Contract Amount: $61,027,433 ($61.0M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2024-10-01
End Date: 2025-09-30
Contract Duration: 364 days
Daily Burn Rate: $167.7K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: FOR THE PROVISION OF NON-PERSONAL SERVICES IAW SMIT CONTRACT AND THIS ORDER'S REQUIREMENT
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $61.0 million to LEIDOS, INC. for work described as: FOR THE PROVISION OF NON-PERSONAL SERVICES IAW SMIT CONTRACT AND THIS ORDER'S REQUIREMENT Key points: 1. Contract value of $61M for computer systems design services indicates substantial investment in IT infrastructure. 2. Full and open competition suggests a robust market for these services, potentially driving competitive pricing. 3. The fixed-price contract type shifts performance risk to the contractor, Leidos, Inc. 4. This delivery order falls under a larger IDIQ contract, suggesting a framework for ongoing IT support needs. 5. The contract duration of one year points to a focused scope of work for the specified period. 6. The primary agency is the Department of the Navy, indicating a specific defense-related IT requirement.
Value Assessment
Rating: good
The contract value of $61,027,433.21 for one year of computer systems design services appears to be within a reasonable range for large-scale IT support within the Department of Defense. Benchmarking against similar large IT services contracts awarded by the Navy or other DoD branches would provide a more precise value-for-money assessment. The firm-fixed-price structure suggests that the government has negotiated a set price, which can be advantageous if the contractor can deliver efficiently. However, without detailed scope of work and performance metrics, a definitive value assessment is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment. A higher number of bidders typically leads to better price discovery and potentially lower costs for the government. The fact that it was competed broadly suggests that the market has multiple capable providers for these complex computer systems design services.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the pool of potential offerors, increasing the likelihood of receiving competitive bids and securing the best possible price for the services rendered.
Public Impact
The Department of the Navy benefits from enhanced computer systems design and support, crucial for its operational effectiveness. This contract ensures the delivery of specialized IT services essential for modern defense operations. The geographic impact is primarily within the operational areas supported by the Department of the Navy, potentially worldwide. Workforce implications include the potential for skilled IT professionals employed by Leidos, Inc. to be engaged in critical defense projects.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for scope creep if the initial requirements are not clearly defined, leading to cost overruns despite the fixed-price nature.
- Dependence on a single large contractor, Leidos, Inc., could limit flexibility in adapting to rapidly changing technological needs.
- Ensuring the contractor's cybersecurity practices meet stringent DoD standards is paramount given the sensitive nature of defense systems.
Positive Signals
- Award to a large, established contractor like Leidos, Inc. suggests a high likelihood of successful performance and adherence to contract terms.
- The firm-fixed-price contract type incentivizes contractor efficiency and cost control.
- The use of a delivery order under an existing IDIQ contract indicates a streamlined procurement process for a pre-vetted service.
Sector Analysis
The IT services sector, particularly within defense, is characterized by significant government spending on complex systems design, integration, and maintenance. This contract for computer systems design services fits within the broader market for IT consulting and systems integration, which is a multi-billion dollar industry. The Department of Defense is a major consumer of these services, often requiring specialized expertise to manage and modernize its vast technological infrastructure. Comparable spending benchmarks would involve looking at other large IT support contracts awarded by federal agencies, especially within the defense sector.
Small Business Impact
This contract does not indicate any specific small business set-aside. The award to Leidos, Inc., a large business, suggests that subcontracting opportunities may arise for small businesses within the IT services ecosystem. However, without explicit subcontracting plans or goals mandated in the contract, the extent of small business participation is uncertain and would depend on Leidos's internal procurement strategies.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within the Department of the Navy. Accountability measures are embedded in the firm-fixed-price contract terms, requiring Leidos, Inc. to deliver specified services within the agreed-upon price. Transparency is facilitated through contract award databases, though detailed performance reports may not always be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Department of Defense IT Modernization Programs
- Navy Information Technology Support Services
- Defense Enterprise IT Services Contracts
- Computer Systems Design and Related Services
Risk Flags
- Contract awarded to a large business, potentially limiting small business participation.
- Fixed-price contract requires careful monitoring to ensure quality and scope adherence.
- Dependence on contractor's cybersecurity posture is critical for defense systems.
Tags
it-services, computer-systems-design, department-of-defense, department-of-the-navy, firm-fixed-price, full-and-open-competition, delivery-order, large-contract, information-technology, defense-contracting, leidos-inc, virginia
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $61.0 million to LEIDOS, INC.. FOR THE PROVISION OF NON-PERSONAL SERVICES IAW SMIT CONTRACT AND THIS ORDER'S REQUIREMENT
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 $61.0 million.
What is the period of performance?
Start: 2024-10-01. End: 2025-09-30.
What is Leidos, Inc.'s track record with the Department of the Navy for similar IT services?
Leidos, Inc. has a substantial history of contracting with the Department of Defense, including the Department of the Navy, across a wide array of IT and professional services. Their portfolio includes significant work in areas such as enterprise IT, C4ISR systems, cybersecurity, and data analytics. Analyzing past performance evaluations and contract awards for Leidos with the Navy can provide insights into their reliability, technical capabilities, and ability to manage complex projects. While specific details of past performance on contracts directly comparable to this $61M computer systems design award are not provided here, Leidos's general presence and scale within the defense IT sector suggest a significant level of experience and established relationships.
How does the $61M contract value compare to typical spending on computer systems design services by the Navy?
The $61,027,433.21 contract value for one year of computer systems design services is a significant award, reflecting the complex and critical nature of IT support within a major military branch like the Department of the Navy. To benchmark this value, one would compare it against the average and median contract values for similar services (NAICS code 541512) awarded by the Navy over the past several fiscal years. Factors such as contract duration, scope of work complexity, and the specific technological requirements heavily influence these values. Given the DoD's substantial IT budget, a $61M award for a single delivery order under an IDIQ contract is not unusual for comprehensive systems design and integration projects, but it represents a considerable investment.
What are the primary risks associated with this firm-fixed-price contract for computer systems design?
The primary risks associated with this firm-fixed-price contract, while generally favorable for the government in terms of cost certainty, lie in potential contractor underperformance or unforeseen technical challenges. If Leidos, Inc. underestimates the complexity or resources required for the computer systems design, they may struggle to deliver within the fixed price, potentially impacting quality or leading to disputes. There's also a risk that the contractor might cut corners on innovation or advanced solutions to maintain profitability. Furthermore, if the government's requirements evolve significantly, managing scope changes under a fixed-price contract can be challenging and may require formal modification processes, potentially leading to delays or increased costs if not handled carefully.
How effective is the 'full and open competition' strategy in ensuring value for this specific IT services contract?
The 'full and open competition' strategy is generally considered highly effective in ensuring value for IT services contracts by maximizing the number of potential bidders. This broad competition increases the likelihood that multiple capable firms will submit proposals, driving down prices through market forces and encouraging innovation. For a contract valued at $61M for computer systems design, this approach allows the Department of the Navy to tap into a wider talent pool and potentially secure more cost-effective solutions than a sole-source or limited competition award. The effectiveness is further realized if the solicitation clearly defines requirements and evaluation criteria, enabling a fair comparison of technical approaches and pricing among bidders.
What are the historical spending patterns for computer systems design services by the Department of the Navy?
The Department of the Navy consistently represents a significant portion of the Department of Defense's overall IT spending. Historical data indicates substantial and ongoing investment in computer systems design, integration, and support services, driven by the need to maintain and modernize complex naval warfare systems, logistics, personnel management, and communication networks. Spending in this category often fluctuates based on major modernization initiatives, cybersecurity upgrades, and the lifecycle of existing systems. The Navy frequently utilizes Indefinite Delivery/Indefinite Quantity (IDIQ) contracts, like the one this delivery order falls under, to procure these services efficiently over multiple years, suggesting a sustained demand and predictable spending pattern in this domain.
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 › IT AND TELECOM - SECURITY AND COMPLIANCE
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N0003918R0005
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 11951 FREEDOM DR FL 15, 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: $61,027,433
Exercised Options: $61,027,433
Current Obligation: $61,027,433
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0003920D0054
IDV Type: IDC
Timeline
Start Date: 2024-10-01
Current End Date: 2025-09-30
Potential End Date: 2025-09-30 00:00:00
Last Modified: 2025-08-19
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