DoD awards Northrop Grumman $20.4M for Financial Management Data Systems Support
Contract Overview
Contract Amount: $20,390,262 ($20.4M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2012-02-01
End Date: 2015-01-31
Contract Duration: 1,095 days
Daily Burn Rate: $18.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: FINANCIAL MANAGEMENT DATA AND SYSTEMS SUPPORT SERVICES
Place of Performance
Location: HERNDON, FAIRFAX County, VIRGINIA, 20171
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $20.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: FINANCIAL MANAGEMENT DATA AND SYSTEMS SUPPORT SERVICES Key points: 1. Contract awarded to a large, established defense contractor. 2. Services fall under Computer Systems Design, a competitive sector. 3. Risk is moderate due to contract duration and fixed-price nature. 4. Spending is within typical benchmarks for IT support services.
Value Assessment
Rating: good
The contract value of $20.4M over three years suggests a reasonable annual spend of approximately $6.8M. This appears competitive for specialized IT support services, especially considering the contractor's experience.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating a robust price discovery process. This method generally leads to more competitive pricing.
Taxpayer Impact: The use of full and open competition aims to ensure taxpayer funds are used efficiently by securing the best value.
Public Impact
Ensures critical financial management systems for the Department of Defense remain operational. Supports the agency's ability to track and manage its vast financial resources. Contributes to the stability and efficiency of defense financial operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Contract duration of 3 years could lead to scope creep or price increases if not managed closely.
- Reliance on a single large contractor for critical systems.
Positive Signals
- Awarded via full and open competition.
- Firm Fixed Price contract type helps control costs.
- Northrop Grumman is a reputable contractor with relevant experience.
Sector Analysis
This contract falls within the IT services sector, specifically computer systems design. Spending benchmarks for similar government IT support contracts vary widely but $6.8M annually is within a reasonable range for complex system support.
Small Business Impact
The contract was awarded to Northrop Grumman Systems Corporation, a large business. There is no indication of small business participation in this specific award.
Oversight & Accountability
The Defense Contract Management Agency (DCMA) is responsible for oversight. The firm fixed-price nature of the contract provides some cost control, but ongoing performance monitoring is crucial.
Related Government Programs
- Computer Systems Design Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Contract duration
- Potential for vendor lock-in
- Complexity of IT systems requiring specialized knowledge
- Reliance on a single large prime contractor
Tags
computer-systems-design-services, department-of-defense, va, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $20.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. FINANCIAL MANAGEMENT DATA AND SYSTEMS SUPPORT SERVICES
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS 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 $20.4 million.
What is the period of performance?
Start: 2012-02-01. End: 2015-01-31.
What is the specific scope of 'Financial Management Data and Systems Support Services' and how does it align with DoD's core financial needs?
These services likely encompass the maintenance, enhancement, and operational support of IT systems used for managing the Department of Defense's financial data. This includes ensuring data integrity, system availability, and potentially developing new functionalities to meet evolving financial reporting and management requirements critical for accountability and resource allocation.
What are the potential risks associated with a 3-year firm fixed-price contract for complex IT systems support?
A 3-year firm fixed-price contract carries risks of the contractor underestimating costs, leading to reduced quality or potential claims, or overestimating, resulting in excessive profit. For complex IT, the fixed price might stifle innovation or lead to the contractor cutting corners on essential maintenance if not carefully monitored, potentially impacting system performance and security over time.
How effectively does the full and open competition process ensure value for money in this specific IT support contract?
Full and open competition is designed to maximize value by allowing all qualified vendors to bid, fostering a competitive environment that drives down prices and encourages high-quality solutions. For this IT support contract, it suggests that multiple vendors were considered, and the award was made to the one offering the best combination of technical capability and price, thereby optimizing taxpayer investment.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › ADMINISTRATIVE SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N0018911RZ051
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 2340 DULLES CORNER BLVD, HERNDON, VA, 20171
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: $20,703,156
Exercised Options: $20,703,156
Current Obligation: $20,390,262
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2012-02-01
Current End Date: 2015-01-31
Potential End Date: 2015-01-31 00:00:00
Last Modified: 2016-07-12
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