NASA's $12.7M IT outsourcing contract to Lockheed Martin shows a decade-long trend of IT service consolidation
Contract Overview
Contract Amount: $12,723,442 ($12.7M)
Contractor: Lockheed Martin Corporation
Awarding Agency: National Aeronautics and Space Administration
Start Date: 2004-04-01
End Date: 2007-03-31
Contract Duration: 1,094 days
Daily Burn Rate: $11.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 9
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: ODIN-OUTSOURCING DESTOP
Place of Performance
Location: MOUNTAIN VIEW, SANTA CLARA County, CALIFORNIA, 94035
Plain-Language Summary
National Aeronautics and Space Administration obligated $12.7 million to LOCKHEED MARTIN CORPORATION for work described as: ODIN-OUTSOURCING DESTOP Key points: 1. This contract represents a significant investment in IT outsourcing, indicating a strategic decision by NASA to leverage external expertise for complex system design. 2. The firm-fixed-price structure suggests a clear scope and budget, aiming to control costs and ensure predictable outcomes for the agency. 3. With 9 bidders, the competition level indicates a healthy market for these specialized IT services, potentially driving competitive pricing. 4. The contract's duration of nearly three years suggests a need for sustained support and a stable partnership with the selected vendor. 5. Lockheed Martin's extensive experience in aerospace and defense likely positions them as a strong contender for large-scale government IT projects. 6. The 'Computer Systems Design Services' classification highlights the focus on developing and integrating sophisticated IT solutions.
Value Assessment
Rating: good
Benchmarking this specific $12.7 million IT outsourcing contract is challenging without direct comparisons of similar scope and duration from the same period. However, the firm-fixed-price contract type generally indicates a good value proposition for the government, as it shifts cost risk to the contractor. The number of bidders (9) suggests a competitive environment that likely contributed to a fair market price. The long-term nature of the contract also implies that the pricing was deemed acceptable for sustained service delivery.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, with 9 bidders vying for the opportunity. This indicates a robust bidding process where multiple qualified vendors could participate, fostering a competitive environment. The presence of numerous bidders suggests that the market for these computer systems design services is active and that NASA had a wide selection of potential contractors to choose from, likely leading to a more favorable price discovery process.
Taxpayer Impact: A full and open competition ensures that taxpayer dollars are used efficiently by leveraging market forces to secure the best possible price and service for this significant IT outsourcing requirement.
Public Impact
NASA personnel benefit from enhanced IT infrastructure and support, allowing them to focus on core space exploration and research missions. The contract delivers essential computer systems design and outsourcing services, crucial for the operational efficiency of the agency. Services are likely concentrated at NASA facilities within California, supporting the agency's technological backbone. The contract supports a workforce skilled in IT systems design, integration, and maintenance, contributing to the high-tech sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in due to the long-term nature of IT outsourcing contracts.
- Reliance on a single large contractor could limit flexibility in adopting new technologies or changing service providers.
- Ensuring continuous knowledge transfer and avoiding critical skill gaps within the agency workforce.
Positive Signals
- Firm-fixed-price contract provides cost certainty and predictability for NASA.
- Full and open competition suggests a competitive pricing environment and access to a broad range of qualified vendors.
- Lockheed Martin's established track record in large-scale government IT projects indicates a high likelihood of successful execution.
Sector Analysis
The IT services sector is a critical component of government operations, with agencies increasingly relying on outsourcing for specialized expertise and cost efficiencies. This contract falls within the 'Computer Systems Design Services' category, a segment characterized by innovation and a demand for skilled professionals. The market size for government IT outsourcing is substantial, driven by the need to modernize legacy systems, enhance cybersecurity, and improve overall operational effectiveness. NASA's spending in this area is consistent with trends across federal agencies seeking to leverage external capabilities for complex IT challenges.
Small Business Impact
This contract was awarded under full and open competition and does not indicate a specific small business set-aside. While the prime contractor is Lockheed Martin, a large corporation, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting would depend on Lockheed Martin's specific teaming arrangements and the requirements outlined in the contract. Further analysis would be needed to determine the direct impact on the small business ecosystem.
Oversight & Accountability
Oversight for this contract would typically be managed by NASA's contracting officers and program managers, ensuring adherence to the firm-fixed-price terms and service level agreements. Accountability is established through performance metrics and reporting requirements. Transparency is facilitated by the contract's public award data. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected or identified during the contract's performance period.
Related Government Programs
- NASA IT Support Services
- Federal Civilian IT Outsourcing
- Computer Systems Design and Integration Contracts
- Large-Scale Government IT Modernization Programs
Risk Flags
- Long-term IT outsourcing contracts can create dependencies.
- Potential for scope creep if not managed tightly, despite fixed-price.
- Ensuring adequate security protocols for sensitive government data.
Tags
it-services, outsourcing, computer-systems-design, nasa, lockheed-martin-corporATION, firm-fixed-price, full-and-open-competition, california, large-contract, it-modernization
Frequently Asked Questions
What is this federal contract paying for?
National Aeronautics and Space Administration awarded $12.7 million to LOCKHEED MARTIN CORPORATION. ODIN-OUTSOURCING DESTOP
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORPORATION.
Which agency awarded this contract?
Awarding agency: National Aeronautics and Space Administration (National Aeronautics and Space Administration).
What is the total obligated amount?
The obligated amount is $12.7 million.
What is the period of performance?
Start: 2004-04-01. End: 2007-03-31.
What was Lockheed Martin's specific track record with NASA or similar agencies prior to winning this contract?
Prior to this contract awarded in 2004, Lockheed Martin had a significant and established track record of performing complex IT and systems integration services for NASA and other federal agencies. The company is a major defense contractor with extensive experience in large-scale government programs, including space exploration support, satellite systems, and mission-critical IT infrastructure. Their history likely demonstrated capabilities in managing large budgets, complex technical requirements, and stringent security protocols, which would have been crucial factors in NASA's evaluation of their proposal for this $12.7 million outsourcing contract.
How does the $12.7 million value compare to other IT outsourcing contracts of similar scope and duration awarded around the same time (2004-2007)?
The $12.7 million value for a nearly three-year IT outsourcing contract in the mid-2000s was substantial but not extraordinary, especially for an agency like NASA. During that period, federal agencies were increasingly consolidating IT services and outsourcing functions to manage costs and leverage specialized expertise. Contracts of this size were common for comprehensive system design and support. Without specific benchmark data for identical services, it's reasonable to infer that this value was competitive, given the firm-fixed-price structure and the full and open competition that attracted 9 bidders, suggesting market validation of the pricing.
What were the primary risks associated with this contract, and how were they mitigated?
Key risks for this IT outsourcing contract likely included potential cost overruns (mitigated by the firm-fixed-price structure), performance deficiencies, security vulnerabilities, and vendor lock-in. Lockheed Martin, as a large and experienced contractor, was expected to manage technical risks. NASA's mitigation strategies would have included clearly defined performance work statements, robust oversight by contracting officers, regular performance reviews, and potentially phased delivery schedules. Security requirements would have been paramount, with specific protocols and audits likely in place to protect NASA's sensitive data and systems.
How effective was this contract in achieving NASA's IT modernization or efficiency goals during its performance period?
Assessing the specific effectiveness of this contract without detailed performance reports or post-contract reviews is difficult. However, the contract's focus on 'Computer Systems Design Services' suggests it aimed to upgrade or maintain NASA's IT infrastructure, potentially leading to improved operational efficiency and support for agency missions. The long duration and the choice of a major contractor like Lockheed Martin imply a strategic intent for sustained improvement. The success would ultimately be measured by whether the designed systems met NASA's evolving technological needs and contributed to mission objectives.
What were NASA's historical spending patterns on IT outsourcing prior to this contract, and how did this fit into the broader trend?
Prior to 2004, NASA, like many federal agencies, was undergoing a period of IT modernization and consolidation. Spending on IT outsourcing was increasing as agencies sought to reduce in-house IT management burdens and tap into external expertise. This $12.7 million contract with Lockheed Martin fits squarely within that trend, representing a significant, but not outlier, investment in external IT services. It reflects a broader federal strategy to leverage the private sector for complex IT solutions, moving away from solely in-house management towards more strategic partnerships.
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 › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 9
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 700 N FREDERICK AVE LOC B, GAITHERSBURG, MD, 90
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Federally Funded Research and Development Corp, Manufacturer of Goods, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $12,723,442
Exercised Options: $12,723,442
Current Obligation: $12,723,442
Parent Contract
Parent Award PIID: NAS598145
IDV Type: IDC
Timeline
Start Date: 2004-04-01
Current End Date: 2007-03-31
Potential End Date: 2007-03-31 00:00:00
Last Modified: 2010-09-08
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