Northrop Grumman awarded $67.8M for BCS3 Support, a custom computer programming services contract

Contract Overview

Contract Amount: $67,840,033 ($67.8M)

Contractor: Northrop Grumman Systems Corporation

Awarding Agency: Department of Defense

Start Date: 2008-01-10

End Date: 2011-06-30

Contract Duration: 1,267 days

Daily Burn Rate: $53.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: BCS3 SUPPORT

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22033

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $67.8 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: BCS3 SUPPORT Key points: 1. Contract value of $67.8M over 3 years indicates significant investment in IT support. 2. Full and open competition suggests a robust bidding process for this service. 3. The contract's duration and value may present performance risks if not managed effectively. 4. This contract falls under custom computer programming services, a critical area for defense operations. 5. The award to a large, established contractor like Northrop Grumman is typical for complex IT projects.

Value Assessment

Rating: good

The contract value of $67.8M for custom computer programming services over approximately three years appears reasonable given the scope of support likely required for a system like BCS3. Benchmarking against similar large-scale IT support contracts within the Department of Defense suggests that pricing is likely competitive, though specific per-unit cost data is not available. The award was made via a delivery order, implying it was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract, which often allows for better pricing through pre-negotiated terms.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The fact that it resulted in a single award suggests that Northrop Grumman was the most advantageous offer, likely based on a combination of technical merit, past performance, and price. The level of competition, while broad in its initial solicitation, ultimately led to one primary contractor for this specific delivery order.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down costs and encourage innovation, leading to better value for public funds.

Public Impact

The Department of Defense, specifically the Department of the Army, is the primary beneficiary, receiving critical IT support services. Services delivered include custom computer programming and support for the BCS3 system, essential for operational effectiveness. The contract is geographically focused on Virginia, where the contractor is located and likely where services are performed or managed. This contract supports a workforce skilled in specialized IT services, contributing to the high-tech sector employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if scope creep occurs without adequate change control.
Dependence on a single contractor for critical system support could pose a risk if performance degrades.
The duration of the contract (over 3 years) necessitates ongoing performance monitoring to ensure continued value.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing structure.
Northrop Grumman is a large, experienced defense contractor with a track record in complex IT systems.
The contract is for essential support services, indicating a clear need and defined requirements.

Sector Analysis

This contract falls within the Information Technology sector, specifically custom computer programming services. The market for such services within the federal government is substantial, driven by the need for specialized software development, integration, and maintenance. Comparable spending benchmarks for large-scale IT support contracts within the Department of Defense often run into tens or hundreds of millions of dollars, reflecting the complexity and criticality of these systems.

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 defense contractor, it is unlikely to have significant direct subcontracting opportunities for small businesses unless explicitly mandated or pursued by the prime contractor. The focus is on large-scale IT solutions rather than fostering the small business ecosystem through direct set-asides.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Department of the Army. Accountability measures are embedded in the contract terms, including performance standards and delivery schedules. Transparency is facilitated through federal procurement databases like FPDS-NG, where contract awards are recorded. Inspector General jurisdiction may apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Information Systems Agency (DISA) IT Services
Army Command and Control Systems Support
General Services Administration (GSA) IT Schedule Contracts
Department of Defense Enterprise IT Services

Risk Flags

Potential for cost overruns due to Time and Materials contract type.
Long contract duration requires sustained performance monitoring.
Dependence on a single large contractor for critical system support.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $67.8 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. BCS3 SUPPORT

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $67.8 million.

What is the period of performance?

Start: 2008-01-10. End: 2011-06-30.

What is the specific nature of the BCS3 system and its criticality to Army operations?

The BCS3 (Battle Command System - Sustainment) is a critical component of the Army's logistics and sustainment command and control capabilities. It provides commanders with real-time visibility into the status of logistics, personnel, and equipment, enabling more effective decision-making during operations. Its criticality lies in ensuring that the right resources are in the right place at the right time, which is fundamental to mission success and troop welfare. Support for BCS3 ensures the system remains operational, updated, and integrated with other battlefield systems.

How does the $67.8M contract value compare to historical spending on BCS3 support?

Historical spending data for BCS3 support prior to this $67.8M award would be necessary for a direct comparison. However, the magnitude of this award suggests a significant, multi-year commitment to maintaining and enhancing the system. If previous support contracts were smaller or shorter in duration, this could indicate an expansion of BCS3's role, increased complexity, or a shift towards a more comprehensive support model. Conversely, if past spending was similar, it suggests a consistent level of investment in this critical capability.

What are the key performance indicators (KPIs) used to assess Northrop Grumman's performance on this contract?

While specific KPIs are not detailed in the provided data, typical performance indicators for custom computer programming and IT support contracts include system uptime/availability, response times for issue resolution, successful deployment of updates and patches, adherence to security protocols, and timely completion of development tasks. The contract likely specifies Service Level Agreements (SLAs) that define acceptable performance thresholds, with penalties or incentives tied to meeting or exceeding these metrics. Regular performance reviews would assess progress against these KPIs.

What is Northrop Grumman's track record with similar large-scale IT support contracts for the Department of Defense?

Northrop Grumman is a major defense contractor with extensive experience in providing IT services, systems integration, and software development for the Department of Defense across various branches. They have a history of managing large, complex programs, including command and control systems, intelligence, surveillance, and reconnaissance (ISR) platforms, and enterprise IT infrastructure. Their track record generally includes successful execution of significant contracts, though like any large contractor, they may have faced challenges on specific projects. Past performance evaluations are a key factor in contract awards.

What are the potential risks associated with a Time and Materials (T&M) contract type for this service?

The contract type is listed as 'TIME AND MATERIALS' (pt: TIME AND MATERIALS), which can introduce risks related to cost control. T&M contracts pay the contractor for the direct labor hours at specified hourly rates and for the actual cost of materials. The primary risk for the government is the potential for cost overruns if the scope of work is not well-defined or if inefficiencies lead to extended labor hours. Effective oversight, detailed tracking of labor and materials, and strong contract management are crucial to mitigate these risks and ensure value for money.

How does this contract align with broader trends in federal IT modernization and digital transformation?

This contract for BCS3 support aligns with the federal government's ongoing efforts in IT modernization and digital transformation, particularly within the defense sector. While focused on sustaining an existing critical system, the 'custom computer programming services' aspect suggests potential for enhancements, upgrades, or integration with newer technologies. Such contracts are essential for maintaining operational readiness while also paving the way for future modernization initiatives, ensuring that legacy systems can interoperate with or be replaced by more advanced solutions.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation (UEI: 967356127)

Address: 12900 FEDERAL SYSTEMS PARK DR, FAIRFAX, VA, 22033

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $68,277,033

Exercised Options: $68,277,033

Current Obligation: $67,840,033

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F4522G

IDV Type: FSS

Timeline