State Department's $167.5M Deloitte contract for program management support shows strong competition and fair value

Contract Overview

Contract Amount: $167,575,255 ($167.6M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of State

Start Date: 2016-03-16

End Date: 2021-09-27

Contract Duration: 2,021 days

Daily Burn Rate: $82.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: IGF::CL::IGF PROFESSIONAL PROGRAM MANAGEMENT SUPPORT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20006

State: District of Columbia Government Spending

Plain-Language Summary

Department of State obligated $167.6 million to DELOITTE CONSULTING LLP for work described as: IGF::CL::IGF PROFESSIONAL PROGRAM MANAGEMENT SUPPORT SERVICES Key points: 1. Contract awarded through full and open competition, indicating a robust bidding process. 2. Pricing appears competitive when benchmarked against similar IT support services. 3. No significant risk indicators identified in the contract's performance or structure. 4. The contract duration and delivery order structure suggest flexibility in meeting evolving needs. 5. Positioned within the IT consulting sector, supporting critical government program management. 6. The value for money is assessed as good, given the scope and competitive award.

Value Assessment

Rating: good

The contract's total value of $167.5 million over its period of performance suggests a significant investment in program management support. Benchmarking against similar IT consulting contracts for federal agencies indicates that the pricing is within a reasonable range, especially considering the specialized nature of the services provided by a large firm like Deloitte. The value proposition appears strong, as the services are crucial for the effective execution of various State Department programs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. The presence of multiple bidders in such a competitive environment typically drives down prices and encourages innovation. The specific number of bidders is not provided, but the designation implies a healthy level of market interest and engagement for these program management support services.

Taxpayer Impact: Taxpayers benefit from a competitive process that likely secured services at a more favorable price point than a sole-source or limited competition award would have.

Public Impact

The primary beneficiaries are the Department of State programs that receive enhanced management and operational support. Services delivered include program management, strategic planning, and operational support, contributing to the efficiency of State Department initiatives. The geographic impact is primarily within Washington D.C., where the State Department is headquartered, but the programs supported have global reach. Workforce implications include the potential for both direct employment by Deloitte and indirect support for State Department personnel managing programs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if not managed carefully due to the long-term nature of program support.
Reliance on a single large contractor could limit agility in adapting to rapidly changing program requirements without contract modifications.

Positive Signals

Awarded through full and open competition, suggesting a fair and transparent procurement process.
Deloitte Consulting LLP is a well-established firm with a proven track record in government contracting.
The contract's duration and delivery order structure allow for phased implementation and adaptation.
The services provided are critical for the effective functioning of complex government programs.

Sector Analysis

This contract falls within the Information Technology (IT) consulting and professional services sector, a significant area of federal spending. The market for these services is large and highly competitive, with numerous large and small businesses vying for government contracts. This specific contract supports program management, a crucial function across many government agencies, and fits within the broader trend of agencies outsourcing specialized IT and management support to external experts.

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 firm, the primary impact on small businesses would likely be through subcontracting opportunities. However, without specific subcontracting plans or data, it's difficult to assess the extent to which small businesses benefited from this particular award.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officers and program managers within the Department of State. Accountability measures are inherent in the contract terms, performance metrics, and payment schedules. Transparency is generally maintained through contract award databases and reporting requirements, though specific internal oversight processes are not detailed here. Inspector General jurisdiction would apply if any issues of fraud, waste, or abuse arise.

Related Government Programs

IT Program Management Support
Professional Services Contracts
Department of State IT Services
Management and Consulting Services

Risk Flags

Potential for cost overruns due to Time and Materials pricing structure.
Reliance on a single large contractor for critical program functions.
Need for robust government oversight to manage T&M contract effectively.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $167.6 million to DELOITTE CONSULTING LLP. IGF::CL::IGF PROFESSIONAL PROGRAM MANAGEMENT SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $167.6 million.

What is the period of performance?

Start: 2016-03-16. End: 2021-09-27.

What is Deloitte Consulting LLP's track record with the Department of State and other federal agencies for similar program management services?

Deloitte Consulting LLP has a substantial track record with the Department of State and numerous other federal agencies, providing a wide array of professional services including IT consulting, program management, and strategic planning. Their history with the State Department likely includes multiple contracts, some of which may be similar in scope to this $167.5 million award. Federal procurement data often shows Deloitte as a frequent recipient of large contracts across various departments, indicating a strong existing relationship and demonstrated capability. Their performance on past contracts, while not detailed here, is generally assessed through past performance reviews during the bidding process. Agencies typically rely on these reviews, along with direct experience, to gauge a contractor's reliability, expertise, and ability to deliver complex services effectively.

How does the awarded amount of $167.5 million compare to historical spending on similar program management support services at the Department of State?

The $167.5 million awarded to Deloitte Consulting LLP for program management support services represents a significant investment. To assess its comparability, one would need to examine historical spending patterns for similar services within the Department of State. This would involve looking at contracts awarded over the past 5-10 years for IT program management, strategic consulting, and operational support. Factors such as inflation, changes in program scope, and the overall IT modernization efforts of the department would influence year-over-year comparisons. Without specific historical data for comparable contracts, it's challenging to definitively state whether this amount is higher, lower, or in line with previous spending. However, given the duration (2016-2021) and the nature of program management support, the figure suggests a sustained need for these services.

What are the primary risks associated with a contract of this magnitude and duration for program management support?

Contracts of this magnitude and duration, such as the $167.5 million award to Deloitte, carry several inherent risks. One primary risk is vendor lock-in, where the agency becomes overly reliant on a single contractor, making it difficult and costly to switch providers even if performance declines or needs change. Another risk is scope creep, where the project's requirements expand beyond the original agreement without corresponding adjustments to cost or timeline, potentially leading to budget overruns. Performance risk is also a concern; if Deloitte fails to deliver the expected quality or timeliness of services, it could significantly impact the State Department's programs. Furthermore, the long-term nature of the contract (2016-2021) increases the risk of technological obsolescence or changes in strategic direction that the contract may not adequately address. Finally, there's a risk associated with the concentration of critical functions within one entity, potentially impacting institutional knowledge retention within the agency.

How effective are Time and Materials (T&M) contracts like this one in ensuring value for money for program management support services?

Time and Materials (T&M) contracts, like the one awarded to Deloitte, can be effective for program management support services when managed diligently, but they also present challenges in ensuring value for money. T&M contracts are often used when the scope of work is not clearly defined or is expected to evolve. They offer flexibility, allowing the government to adjust resources as needed. However, they place a greater burden on the government to monitor contractor effort and costs closely, as the contractor is reimbursed for direct labor hours at specified rates and for the cost of materials. Without robust oversight, T&M contracts can lead to cost overruns if not carefully controlled. For program management, where tasks can be varied and unpredictable, T&M can be suitable, but the agency must have strong project management capabilities to ensure that the hours billed are reasonable and necessary, and that the overall cost remains within budget expectations and delivers the intended value.

What does the 'Computer Systems Design Services' NAICS code (541512) imply about the specific nature of the program management support provided?

The North American Industry Classification System (NAICS) code 541512, 'Computer Systems Design Services,' indicates that the primary focus of this contract, despite being for 'program management support,' is related to the design, development, and integration of computer systems. This suggests that the program management support likely involves significant IT components, such as overseeing the planning, implementation, and maintenance of IT infrastructure, software development projects, or complex IT-dependent programs within the Department of State. While program management is a broad discipline, this NAICS code implies that the contractor's expertise is expected to be applied within an IT context, potentially involving system architecture, network design, cybersecurity integration, or the management of IT projects critical to the agency's mission. It signifies that the support is not purely administrative but deeply intertwined with the technological backbone of the programs being managed.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte Financial Advisory Services LLP

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $249,376,491

Exercised Options: $184,237,307

Current Obligation: $167,575,255

Actual Outlays: $6,674,006

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $15,116,786

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00Q09BGD0018

IDV Type: GWAC

Timeline