DoD's JETS System Sustained for $64.8M, Raising Questions on Value and Competition

Contract Overview

Contract Amount: $64,788,604 ($64.8M)

Contractor: Accenture Federal Services LLC

Awarding Agency: Department of Defense

Start Date: 2018-05-01

End Date: 2021-07-31

Contract Duration: 1,187 days

Daily Burn Rate: $54.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 117

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: 8505394219!JETS SYSTEM SUSTAINMENT/MAINT

Place of Performance

Location: FORT BELVOIR, FAIRFAX County, VIRGINIA, 22060

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $64.8 million to ACCENTURE FEDERAL SERVICES LLC for work described as: 8505394219!JETS SYSTEM SUSTAINMENT/MAINT Key points: 1. The contract's value appears high relative to its duration and the services provided. 2. Limited competition may have impacted pricing and overall value for taxpayers. 3. The firm-fixed-price structure offers some cost certainty but may not incentivize efficiency. 4. Performance context is limited, making it difficult to assess the contractor's effectiveness. 5. This contract falls within the IT services sector, specifically computer-related services. 6. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: fair

The total award of $64.8 million over 1187 days (approximately 3.25 years) suggests an average annual spend of roughly $20 million. Benchmarking against similar IT sustainment contracts is challenging without more granular data on the specific services rendered. However, the lack of detailed performance metrics makes it difficult to definitively assess value for money. The firm-fixed-price contract type provides cost predictability but could potentially lead to overpayment if the contractor's costs are significantly lower than the awarded price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with 117 bids received. While a high number of bids suggests robust initial interest, the subsequent award details do not indicate the number of proposals evaluated or the specific reasons for selecting Accenture Federal Services LLC. The extensive competition theoretically should drive down prices, but the final award value needs to be assessed against the scope of work and market rates to confirm if optimal pricing was achieved.

Taxpayer Impact: The high number of bidders is a positive sign for taxpayers, indicating a competitive marketplace. However, the ultimate value realized depends on whether the competition effectively translated into the lowest possible price for the required services.

Public Impact

The primary beneficiaries are the Department of Defense, which receives sustainment for its JETS system. The services delivered include IT system sustainment, crucial for maintaining operational readiness. The geographic impact is likely concentrated within DoD facilities and operations, primarily in Virginia where the contractor is based. Workforce implications include the employment of IT professionals by Accenture Federal Services LLC to fulfill the contract requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed performance metrics makes it hard to gauge contractor effectiveness.
Potential for overpayment under a firm-fixed-price contract if costs are lower than expected.
Limited information on how the extensive competition translated into the final award price.
Absence of specific small business set-asides raises questions about broader economic impact.

Positive Signals

Awarded under full and open competition, indicating a broad market approach.
A large number of bids (117) suggests significant market interest and potential for competitive pricing.
Firm-fixed-price contract provides cost certainty for the government.

Sector Analysis

This contract falls within the broader IT services sector, specifically under 'Other Computer Related Services' (NAICS 541519). This category encompasses a wide range of IT support and maintenance activities. The market for IT sustainment services for government systems is substantial, with numerous large and small businesses competing for these contracts. Benchmarking this contract's value requires comparison against similar sustainment efforts for complex defense systems, considering factors like system criticality and required expertise.

Small Business Impact

The contract data indicates that small business participation was not a primary focus, as the 'sb' (small business) flag is false and there's no mention of set-asides. This suggests that the prime contract was awarded to a large business. Further analysis would be needed to determine if subcontracting opportunities were made available to small businesses and if the contractor met any potential subcontracting goals, which could impact the broader small business ecosystem within the IT services sector.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and program management structures, likely managed by the Defense Logistics Agency (DLA). Accountability measures are inherent in the firm-fixed-price contract, requiring the contractor to deliver specified services. Transparency is facilitated by contract award databases, but detailed performance reviews and Inspector General involvement would depend on specific performance issues or audits.

Related Government Programs

JETS System Operations
DoD IT Infrastructure Support
Defense Logistics Agency IT Services
Accenture Federal Services Contracts

Risk Flags

Potential for suboptimal value due to limited competition impact.
Lack of detailed performance metrics hinders value assessment.
Firm-fixed-price risk requires strong oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $64.8 million to ACCENTURE FEDERAL SERVICES LLC. 8505394219!JETS SYSTEM SUSTAINMENT/MAINT

Who is the contractor on this award?

The obligated recipient is ACCENTURE FEDERAL SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $64.8 million.

What is the period of performance?

Start: 2018-05-01. End: 2021-07-31.

What specific sustainment services were included under the JETS System contract?

The provided data indicates the contract is for 'JETS SYSTEM SUSTAINMENT/MAINT'. While the specific details of sustainment services are not itemized in the summary data, typical activities for such contracts include software maintenance, hardware support, system upgrades, bug fixes, performance monitoring, and ensuring the overall operational readiness and security of the JETS system. The scope would be defined in the contract's Statement of Work (SOW), which would detail the exact deliverables, service levels, and technical requirements expected from Accenture Federal Services LLC.

How does the $64.8 million award compare to similar IT sustainment contracts within the Department of Defense?

Direct comparison is difficult without knowing the precise scope and complexity of the JETS system and its sustainment needs. However, $64.8 million over approximately 3.25 years ($20M/year) is a significant investment. For context, other large IT sustainment contracts within DoD can range from tens to hundreds of millions of dollars annually, depending on the system's criticality, user base, and technological sophistication. The value here appears moderate to high for a sustainment effort, warranting scrutiny against comparable contracts for systems of similar scale and importance.

What are the potential risks associated with a firm-fixed-price contract for IT system sustainment?

The primary risk with a firm-fixed-price (FFP) contract for IT sustainment is the potential for the contractor to underperform or cut corners to maximize profit if their actual costs are significantly lower than the fixed price. Conversely, if the scope of work expands or unforeseen technical challenges arise, the contractor may seek change orders, potentially increasing costs. For the government, the risk is paying a premium if the contractor's efficiency is exceptionally high, or receiving suboptimal service if quality is sacrificed for profit. Effective government oversight is crucial to mitigate these risks.

What does the high number of bidders (117) imply about the competition for this contract?

Receiving 117 bids suggests a highly competitive initial bidding environment. This indicates that the market has sufficient capacity and interest to support the JETS system sustainment requirements. Theoretically, this level of competition should drive down prices and encourage innovation. However, the ultimate success in achieving value for money depends on how effectively the evaluation process selected the best-value proposal and whether the final negotiated price reflects the competitive landscape. It's possible that many bids were non-competitive or did not meet all requirements, but the sheer volume is a strong positive signal.

What is the track record of Accenture Federal Services LLC in performing similar IT sustainment contracts for the DoD?

Accenture Federal Services LLC is a major government contractor with a substantial history of performing IT services, including sustainment, for various federal agencies, including the Department of Defense. While specific performance details for the JETS contract are not provided here, their extensive experience suggests a capacity to handle complex IT requirements. A deeper dive into past performance evaluations, contract awards, and any reported issues or successes on similar DoD contracts would be necessary for a comprehensive assessment of their track record.

Are there any indications of cost overruns or significant contract modifications during the performance period?

The provided summary data does not include information on contract modifications, cost overruns, or performance issues. The total award amount of $64.8 million is presented as the final value. To determine if there were cost overruns or significant modifications, one would need to examine the contract's official award history, including any supplemental agreements or change orders issued during its performance period (May 1, 2018, to July 31, 2021).

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related 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: 117

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Accenture Public Limited Company

Address: 800 NORTH GLEBE RD #300, ARLINGTON, VA, 22203

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $64,788,604

Exercised Options: $64,788,604

Current Obligation: $64,788,604

Subaward Activity

Number of Subawards: 81

Total Subaward Amount: $12,917,384

Contract Characteristics

Consolidated Contract: Yes

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SP470917D0023

IDV Type: IDC

Timeline