State Dept. Awards $2.2B Global Supply Chain Contract to General Dynamics IT
Contract Overview
Contract Amount: $1,219,847,694 ($1.2B)
Contractor: General Dynamics Information Technology, Inc.
Awarding Agency: Department of State
Start Date: 2012-06-08
End Date: 2019-09-07
Contract Duration: 2,647 days
Daily Burn Rate: $460.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: IGF::OT::IGF THE PURPOSE OF THIS ACTION IS TO ESTABLISH A NEW CONTRACT WITH GENERAL DYNAMICS INFORMATION TECHNOLOGY FOR GLOBAL SUPPLY CHAIN MANAGEMENT, LOGISTICS AND TECHNOLOGY DEVELOPMENT SERVICES TO SUPPORT THE DEPARTMENT OF STATE. THE INITIAL FUNDING ASSOCIATED WITH THIS CONTRACT IS $22,304,578.00. THE OVERALL CONTRACT VALUE IS $2,200,000,000.00
Place of Performance
Location: STERLING, LOUDOUN County, VIRGINIA, 20164
State: Virginia Government Spending
Plain-Language Summary
Department of State obligated $1.22 billion to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::OT::IGF THE PURPOSE OF THIS ACTION IS TO ESTABLISH A NEW CONTRACT WITH GENERAL DYNAMICS INFORMATION TECHNOLOGY FOR GLOBAL SUPPLY CHAIN MANAGEMENT, LOGISTICS AND TECHNOLOGY DEVELOPMENT SERVICES TO SUPPORT THE DEPARTMENT OF STATE. THE INITIAL FUNDING ASSOCIATED WITH THIS CONTR… Key points: 1. Significant investment in global supply chain management and logistics services. 2. General Dynamics IT secured a large, long-term contract. 3. Potential risks include vendor lock-in and performance management over the contract's duration. 4. The IT consulting and services sector sees substantial government spending.
Value Assessment
Rating: fair
The initial funding of $22.3M is a small fraction of the total $2.2B value, suggesting significant future spending. Benchmarking against similar large-scale logistics and IT services contracts is difficult without more granular data on specific service components.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which generally promotes competitive pricing. However, the long-term nature and broad scope could lead to price escalations over time if not managed effectively.
Taxpayer Impact: Taxpayers are funding critical global supply chain operations for the Department of State, with the potential for cost efficiencies if services are delivered effectively and competitively priced over the contract's life.
Public Impact
Ensures continuity of essential global supply chain and logistics operations for diplomatic missions. Supports technology development for improved efficiency and security in supply chain management. Creates jobs and economic activity through a major federal contract award.
Waste & Efficiency Indicators
Waste Risk Score: 75 / 10
Warning Flags
- Long contract duration (approx. 7 years)
- High total contract value ($2.2B)
- Cost-plus contract type can incentivize spending
Positive Signals
- Full and open competition
- Supports critical government function
- Potential for technology modernization
Sector Analysis
This contract falls within the IT and professional services sector, specifically focusing on logistics and supply chain management. Government spending in this area is substantial, driven by the need for efficient and secure operations across various agencies.
Small Business Impact
While the prime contractor is a large business, opportunities may exist for small businesses to participate as subcontractors, particularly in specialized logistics or technology development areas. Further analysis would be needed to confirm subcontracting plans.
Oversight & Accountability
Oversight will be crucial to ensure General Dynamics IT meets performance requirements and manages costs effectively throughout the contract's lifecycle. Regular performance reviews and audits are essential for accountability.
Related Government Programs
- Process, Physical Distribution, and Logistics Consulting Services
- Department of State Contracting
- Department of State Programs
Risk Flags
- High contract value
- Long contract duration
- Cost-plus contract type
- Potential for scope creep
- Dependence on a single vendor for critical services
Tags
process-physical-distribution-and-logist, department-of-state, va, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of State awarded $1.22 billion to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::OT::IGF THE PURPOSE OF THIS ACTION IS TO ESTABLISH A NEW CONTRACT WITH GENERAL DYNAMICS INFORMATION TECHNOLOGY FOR GLOBAL SUPPLY CHAIN MANAGEMENT, LOGISTICS AND TECHNOLOGY DEVELOPMENT SERVICES TO SUPPORT THE DEPARTMENT OF STATE. THE INITIAL FUNDING ASSOCIATED WITH THIS CONTRACT IS $22,304,578.00. THE OVERALL CONTRACT VALUE IS $2,200,000,000.00
Who is the contractor on this award?
The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC..
Which agency awarded this contract?
Awarding agency: Department of State (Department of State).
What is the total obligated amount?
The obligated amount is $1.22 billion.
What is the period of performance?
Start: 2012-06-08. End: 2019-09-07.
What specific metrics will be used to measure the effectiveness and efficiency of the global supply chain management and logistics services provided?
Effectiveness will likely be measured by key performance indicators (KPIs) related to delivery times, cost savings achieved, inventory accuracy, and reduction in supply chain disruptions. The contract should detail these metrics and the reporting frequency to ensure accountability and track progress towards stated goals.
How will the Department of State ensure that the 'cost plus fixed fee' structure does not lead to excessive spending or a lack of cost control over the contract's duration?
The Department of State must implement robust oversight mechanisms, including detailed cost audits and performance reviews. Clear baseline cost estimates and regular comparisons against them are essential. The fixed fee component provides some incentive for efficiency, but vigilant monitoring of all incurred costs is paramount.
What is the plan for knowledge transfer and potential transition to a new vendor or in-house management at the end of the contract to avoid long-term dependency?
A comprehensive transition plan should be part of the contract, outlining knowledge transfer protocols and documentation requirements. The Department should also consider developing internal capabilities or planning for future competitive procurements well in advance to ensure continuity and avoid vendor lock-in.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Process, Physical Distribution, and Logistics Consulting 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: Wico Limited
Address: 3211 JERMANTOWN RD, FAIRFAX, VA, 22030
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $2,386,055,531
Exercised Options: $1,894,305,240
Current Obligation: $1,219,847,694
Subaward Activity
Number of Subawards: 21
Total Subaward Amount: $59,814,735
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2012-06-08
Current End Date: 2019-09-07
Potential End Date: 2019-09-07 00:00:00
Last Modified: 2024-05-15
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