Leidos awarded $79M for NMCI Services, a significant contract for IT systems design
Contract Overview
Contract Amount: $79,045,819 ($79.0M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2021-09-01
End Date: 2021-09-30
Contract Duration: 29 days
Daily Burn Rate: $2.7M/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: NMCI SERVICES - SMIT CONTRACT 09/21
Place of Performance
Location: NORFOLK, NORFOLK CITY County, VIRGINIA, 23511
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $79.0 million to LEIDOS, INC. for work described as: NMCI SERVICES - SMIT CONTRACT 09/21 Key points: 1. Contract value represents a substantial investment in IT infrastructure. 2. Full and open competition suggests a potentially competitive bidding process. 3. Fixed-price contract type shifts risk to the contractor. 4. Short duration of 29 days indicates a specific, task-oriented award. 5. Focus on computer systems design services aligns with broader defense IT modernization efforts. 6. Awarded by the Department of the Navy, highlighting a key defense sector need.
Value Assessment
Rating: good
The $79 million award for NMCI Services is a significant sum, but its value is best assessed within the context of the broader Navy Marine Corps Intranet (NMCI) program. Without specific performance metrics or comparable delivery orders for similar scope and duration, a precise value-for-money assessment is challenging. However, the firm-fixed-price structure is generally favorable for the government, locking in costs. The contract's short duration suggests it may be for a specific project or phase, making direct cost comparison difficult without understanding the deliverables.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. This approach typically fosters a competitive environment, potentially leading to better pricing and innovative solutions. The number of bidders is not specified, but the open competition suggests multiple entities likely vied for this award, which is a positive sign for price discovery and market responsiveness.
Taxpayer Impact: Full and open competition generally benefits taxpayers by encouraging a wider range of offers, which can drive down costs and improve the quality of services received.
Public Impact
The primary beneficiaries are the Department of the Navy and its personnel, who rely on robust IT systems for operations. Services delivered include computer systems design, crucial for maintaining and upgrading the Navy's IT infrastructure. The geographic impact is likely concentrated within Navy facilities, particularly in Virginia where the contractor is based. Workforce implications may include specialized IT professionals involved in system design and implementation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Short contract duration (29 days) could indicate a narrow scope or a bridge contract, requiring further investigation into the full IT support strategy.
- Lack of detailed performance metrics makes it difficult to fully assess the effectiveness and efficiency of the awarded services.
- The sheer scale of IT contracts within the defense sector necessitates continuous monitoring for cost overruns and scope creep, even with fixed-price agreements.
Positive Signals
- Awarded under full and open competition, suggesting a robust and fair bidding process.
- Firm-fixed-price contract type provides cost certainty for the government.
- Leidos, Inc. is a large, established government contractor with significant experience in IT services, implying a degree of reliability.
Sector Analysis
This contract falls within the Computer Systems Design Services sector, a critical component of the broader Information Technology (IT) industry. The IT sector supporting the federal government is vast, with significant spending allocated to maintaining and modernizing complex systems like the Navy Marine Corps Intranet (NMCI). Comparable spending benchmarks would involve looking at other large-scale IT service contracts awarded to major defense contractors for similar system design and integration work, often in the hundreds of millions or billions of dollars annually.
Small Business Impact
The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large contract awarded to a major prime contractor, it is possible that subcontracting opportunities may exist for small businesses within the IT ecosystem. However, without specific subcontracting plans or goals outlined in the award details, the direct impact on the small business sector remains unclear. Further analysis would be needed to determine if small businesses are being leveraged for specialized services under this prime contract.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures are inherent in the firm-fixed-price contract type, which obligates the contractor to deliver specified services at an agreed-upon price. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise concerning the contract's execution.
Related Government Programs
- Navy Marine Corps Intranet (NMCI)
- Defense Information Systems Agency (DISA) contracts
- General Services Administration (GSA) IT Schedule contracts
- Department of Defense IT Modernization Programs
Risk Flags
- Short contract duration may indicate a bridge contract or limited scope.
- Lack of detailed performance metrics hinders full value assessment.
- Potential for scope creep in complex IT design projects.
- Reliance on large prime contractors may limit direct small business opportunities.
Tags
it, defense, department-of-defense, department-of-the-navy, computer-systems-design-services, firm-fixed-price, delivery-order, full-and-open-competition, leidos-inc, virginia, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $79.0 million to LEIDOS, INC.. NMCI SERVICES - SMIT CONTRACT 09/21
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 $79.0 million.
What is the period of performance?
Start: 2021-09-01. End: 2021-09-30.
What is Leidos, Inc.'s track record with similar IT service contracts for the Department of Defense?
Leidos, Inc. has a substantial track record of performing large-scale IT service contracts for the Department of Defense and other federal agencies. They are a major player in areas such as enterprise IT, cybersecurity, cloud migration, and systems integration. Their history includes significant work on programs like the Navy Marine Corps Intranet (NMCI) itself, as well as contracts with the Air Force, Army, and intelligence agencies. Analyzing their past performance on similar fixed-price, full-and-open competition contracts would provide insight into their ability to deliver within scope and budget. Publicly available data and contract award histories often detail their performance ratings and any past issues, though specific details on this particular $79 million award's execution are limited by its recent nature and short duration.
How does the $79 million value compare to other IT systems design contracts awarded by the Navy in the past year?
The $79 million value for this specific delivery order is a significant amount for a 29-day contract, suggesting a substantial scope of work or a high-value task order within a larger IDIQ contract. To benchmark this, one would compare it against other delivery orders or task orders issued by the Department of the Navy for 'Computer Systems Design Services' (NAICS 541512) over a similar period. Larger, multi-year contracts for comprehensive IT modernization or sustainment programs can run into hundreds of millions or even billions of dollars. However, for a discrete, short-term project focused on design, $79 million indicates a high level of complexity or criticality. Without access to a comprehensive database of all Navy IT delivery orders, precise comparisons are difficult, but this figure suggests a major undertaking.
What are the primary risks associated with a firm-fixed-price contract of this magnitude and short duration?
The primary risk with a firm-fixed-price (FFP) contract, especially one of this magnitude ($79 million), is that the contractor (Leidos, Inc.) bears the financial risk if costs exceed the agreed-upon price. For the government, the risk is that the contractor may cut corners on quality or scope to protect their profit margin if unforeseen challenges arise. Given the short 29-day duration, risks could include the contractor underestimating the complexity of the design work, leading to potential delays or incomplete deliverables if not managed meticulously. Scope creep is also a risk; if the requirements expand beyond the initial agreement, managing changes under an FFP can be contentious. However, FFP contracts are generally favored for providing cost certainty to the government.
What does the 'NMCI SERVICES - SMIT CONTRACT 09/21' designation imply about the program's effectiveness?
The designation 'NMCI SERVICES - SMIT CONTRACT 09/21' indicates this is a specific contract related to the Navy Marine Corps Intranet (NMCI) program, likely awarded in September 2021. NMCI is a massive, long-standing initiative to provide a unified IT infrastructure for the Navy and Marine Corps. The 'SMIT' likely refers to a specific service or component within NMCI, possibly related to Service Management, Integration, and Transition, or a similar technical area. The effectiveness of this particular contract is tied to its contribution to the overall goals of NMCI, such as network reliability, security, and user support. The fact that it's a delivery order under a larger framework suggests it addresses a specific, ongoing need within the program. Evaluating its effectiveness would require examining the deliverables against the contract's objectives and NMCI's broader performance metrics.
How has federal spending on computer systems design services evolved, and where does this contract fit?
Federal spending on computer systems design services (NAICS 541512) has consistently grown over the past decade, driven by the increasing reliance on technology across all government agencies and the continuous need for modernization, cybersecurity, and data management. The Department of Defense is consistently one of the largest federal spenders in this category. This $79 million award to Leidos fits within this trend as a significant, albeit short-term, investment in critical IT infrastructure for the Navy. It represents a portion of the vast sums the DoD allocates annually to maintain and upgrade its complex digital ecosystem. Trends show a shift towards cloud computing, AI, and advanced analytics, so contracts like this may focus on designing systems that incorporate these newer technologies or integrate legacy systems with them.
What is the significance of the contract being a 'Delivery Order'?
The designation 'DELIVERY ORDER' signifies that this contract is likely a task order issued under a larger, pre-existing Indefinite Delivery/Indefinite Quantity (IDIQ) contract or a similar multiple-award contract vehicle. IDIQ contracts allow agencies to procure a range of supplies or services over a set period, with specific quantities and delivery dates defined by individual delivery orders. This approach provides flexibility for the agency to order services as needed. For the government, it streamlines the procurement process for recurring or anticipated needs. For the contractor, it represents a confirmed piece of work within a broader contractual framework. The short duration (29 days) and specific value ($79 million) suggest this order addressed a well-defined, immediate requirement within the scope of the parent IDIQ contract.
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 - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc. (UEI: 611641312)
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: $79,045,819
Exercised Options: $79,045,819
Current Obligation: $79,045,819
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0003920D0054
IDV Type: IDC
Timeline
Start Date: 2021-09-01
Current End Date: 2021-09-30
Potential End Date: 2021-09-30 00:00:00
Last Modified: 2021-10-18
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