DoD awards $30.4M contract for cloud migration and application modernization to Accenture Federal Services

Contract Overview

Contract Amount: $30,444,193 ($30.4M)

Contractor: Accenture Federal Services LLC

Awarding Agency: Department of Defense

Start Date: 2024-01-09

End Date: 2027-01-08

Contract Duration: 1,095 days

Daily Burn Rate: $27.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: THE EAMM REQUIREMENT WILL INCLUDE PERFORMING DEEP APPLICATION ASSESSMENTS FOR APPLICATION OWNERS AND, MODERNIZE AND MIGRATE APPLICATIONS INTO DOD AUTHORIZED IMPACT LEVEL 2,4,5 AND 6 COMMERCIAL CLOUD ENVIRONMENTS.

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22203

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $30.4 million to ACCENTURE FEDERAL SERVICES LLC for work described as: THE EAMM REQUIREMENT WILL INCLUDE PERFORMING DEEP APPLICATION ASSESSMENTS FOR APPLICATION OWNERS AND, MODERNIZE AND MIGRATE APPLICATIONS INTO DOD AUTHORIZED IMPACT LEVEL 2,4,5 AND 6 COMMERCIAL CLOUD ENVIRONMENTS. Key points: 1. Contract focuses on modernizing and migrating applications to various DoD-authorized cloud environments. 2. The contract value of $30.4 million over 3 years suggests a significant investment in cloud infrastructure. 3. Full and open competition was utilized, indicating a broad market search for qualified vendors. 4. The primary service category is Computer Systems Design Services, aligning with cloud migration needs. 5. The contract is a Delivery Order under a larger contract vehicle, suggesting a phased approach to services. 6. The fixed-price nature of the contract shifts some performance risk to the contractor.

Value Assessment

Rating: good

The contract value of $30.4 million over 1095 days (3 years) averages approximately $10.15 million per year. Benchmarking this against similar cloud migration and application modernization contracts is challenging without more specific details on the scope of work and the number of applications involved. However, the price appears within a reasonable range for complex IT modernization efforts within the federal government. The fixed-price structure suggests the government has a clear understanding of the requirements and is seeking cost certainty.

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 data indicates 11 bids were received, suggesting a healthy level of competition for this requirement. A competitive process like this generally leads to better price discovery and a wider range of technical solutions being considered.

Taxpayer Impact: The use of full and open competition is beneficial for taxpayers as it encourages multiple vendors to offer their best pricing and innovative solutions, ultimately driving down costs and improving service delivery.

Public Impact

The Department of the Army will benefit from modernized applications and improved cloud infrastructure, enhancing operational efficiency. Services delivered include deep application assessments, modernization, and migration to commercial cloud environments (Impact Levels 2, 4, 5, and 6). The geographic impact is primarily within the Department of Defense's operational footprint, with potential benefits extending to national security. Workforce implications may include the need for specialized cloud and cybersecurity skills within the Army and potential upskilling opportunities for existing personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if application assessment reveals unforeseen complexities.
Dependence on contractor expertise for successful migration to diverse cloud environments.
Ensuring data security and compliance across multiple impact levels in commercial clouds.

Positive Signals

Leveraging commercial cloud capabilities can offer scalability and cost efficiencies.
Modernization efforts are crucial for maintaining a secure and up-to-date IT infrastructure.
The use of full and open competition suggests a robust selection process for the best value.

Sector Analysis

The federal IT services market, particularly for cloud computing and application modernization, is a significant and growing sector. Agencies are increasingly migrating legacy systems to cloud environments to improve agility, reduce costs, and enhance security. This contract fits within the broader trend of digital transformation within the Department of Defense, aiming to leverage commercial cloud solutions for mission-critical applications. Comparable spending benchmarks would typically involve analyzing other large-scale cloud migration contracts awarded by DoD or other federal agencies for similar services.

Small Business Impact

The data indicates that small business participation (sb) is false and the contract was not set aside for small businesses (ss is false). This suggests that the primary awardee, Accenture Federal Services LLC, is a large business. There is no explicit information on subcontracting plans for small businesses within this specific delivery order. The lack of a small business set-aside means that opportunities for small businesses may be limited unless they are part of a larger subcontracting effort managed by the prime contractor.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army contracting officers and program managers. The fixed-price nature of the contract provides a degree of accountability for the contractor to deliver services within the agreed-upon budget. Transparency is facilitated through contract award databases and reporting mechanisms. The Inspector General's office may conduct audits or investigations if performance issues or potential fraud are identified.

Related Government Programs

DoD Cloud Computing Strategy
Application Modernization Initiatives
IT Infrastructure Modernization Programs
Commercial Cloud Services Contracts

Risk Flags

Potential for cost overruns if scope is not well-defined.
Risk of security breaches during cloud migration.
Dependence on contractor's technical expertise.
Challenges in ensuring interoperability across different cloud environments.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.4 million to ACCENTURE FEDERAL SERVICES LLC. THE EAMM REQUIREMENT WILL INCLUDE PERFORMING DEEP APPLICATION ASSESSMENTS FOR APPLICATION OWNERS AND, MODERNIZE AND MIGRATE APPLICATIONS INTO DOD AUTHORIZED IMPACT LEVEL 2,4,5 AND 6 COMMERCIAL CLOUD ENVIRONMENTS.

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 (Department of the Army).

What is the total obligated amount?

The obligated amount is $30.4 million.

What is the period of performance?

Start: 2024-01-09. End: 2027-01-08.

What is Accenture Federal Services LLC's track record with similar cloud migration and application modernization contracts within the DoD?

Accenture Federal Services LLC has a substantial track record in providing IT modernization, cloud migration, and digital transformation services to various U.S. federal agencies, including the Department of Defense. They have been involved in large-scale projects aimed at migrating legacy systems to cloud environments and modernizing applications to enhance performance, security, and scalability. Their experience often spans across different cloud service models (IaaS, PaaS, SaaS) and various cloud providers. Specific to the DoD, Accenture has supported initiatives related to enterprise resource planning (ERP) modernization, data center consolidation, and the adoption of cloud-based solutions to improve warfighter capabilities and operational efficiency. Their past performance on similar contracts would be a key factor in the DoD's decision-making process for awarding this current delivery order.

How does the $30.4 million contract value compare to other DoD cloud migration efforts of similar scope?

The $30.4 million contract value for cloud migration and application modernization over three years is a significant but not exceptionally large sum within the context of major DoD IT modernization programs. The DoD's overall IT budget is in the tens of billions of dollars annually, and large-scale cloud initiatives can easily run into hundreds of millions or even billions over their lifecycle. This specific contract's value suggests a focused effort on a defined set of applications or a particular phase of a larger migration. To provide a precise comparison, one would need to analyze contracts with identical scope (e.g., number of applications, complexity of modernization, specific cloud impact levels targeted, and the extent of migration). However, for a multi-year project involving application assessment, modernization, and migration to multiple cloud impact levels, $30.4 million appears to be a reasonable investment, reflecting the complexity and strategic importance of such endeavors.

What are the primary risks associated with migrating DoD applications to commercial cloud environments at Impact Levels 2, 4, 5, and 6?

Migrating DoD applications to commercial cloud environments across Impact Levels 2, 4, 5, and 6 presents several key risks. A primary concern is data security and compliance, as each impact level has specific requirements for handling sensitive information, including Controlled Unclassified Information (CUI), For Official Use Only (FOUO), and classified data (at higher levels). Ensuring that the chosen commercial cloud provider and the implemented architecture meet these stringent DoD requirements is critical. Another risk is vendor lock-in, where the agency becomes overly dependent on a single cloud provider's proprietary services, making future transitions difficult or costly. Performance and availability can also be risks, especially if the network infrastructure or the cloud services themselves experience outages or latency issues, impacting mission-critical operations. Furthermore, the complexity of managing applications across different cloud environments and ensuring seamless integration between them poses significant technical and operational challenges. Finally, the cost management of cloud services, particularly with fluctuating usage patterns, can lead to unexpected expenses if not carefully monitored and optimized.

What does the 'Computer Systems Design Services' (NAICS 541512) classification imply for the scope of this contract?

The North American Industry Classification System (NAICS) code 541512, 'Computer Systems Design Services,' indicates that the primary focus of this contract is on providing expertise in designing, developing, integrating, and implementing computer systems. For this specific contract, it implies that Accenture Federal Services LLC will be responsible for analyzing the existing application architecture, designing new or modified systems suitable for cloud environments, and overseeing the integration and migration process. This goes beyond simple IT support or hardware provision; it encompasses the strategic planning, architectural design, and technical execution required to transform applications and infrastructure for cloud deployment. The services likely include requirements analysis, system architecture development, software integration, testing, and deployment support, all tailored to meet the DoD's specific needs for cloud adoption across various impact levels.

How does the fixed-price contract type (PT) influence the government's risk and the contractor's performance incentives?

A Firm Fixed Price (FFP) contract type, as indicated by 'PT: FIRM FIXED PRICE', means that the contractor, Accenture Federal Services LLC, is obligated to complete the work for a predetermined price, regardless of the actual costs incurred. This structure shifts the majority of the cost risk from the government to the contractor. For the government, this provides budget certainty and protects against cost overruns, assuming the initial price was set appropriately based on a well-defined scope. For the contractor, it creates a strong incentive to manage costs efficiently and perform the work effectively to maximize profit. If the contractor can complete the work for less than the fixed price, their profit increases. Conversely, if costs exceed the fixed price, their profit decreases, or they may incur a loss. This type of contract is generally preferred when the scope of work is well-understood and unlikely to change significantly, as it is here with a defined delivery order for application modernization and migration.

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 › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 11

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Novetta Solutions, LLC

Address: 800 N GLEBE RD STE 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: $132,526,725

Exercised Options: $30,444,193

Current Obligation: $30,444,193

Actual Outlays: $952,444

Subaward Activity

Number of Subawards: 10

Total Subaward Amount: $4,760,742

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 47QTCK18D0036

IDV Type: GWAC

Timeline