Army awards $30.7M SAP consulting contract to SAP National Security Services Inc

Contract Overview

Contract Amount: $30,721,546 ($30.7M)

Contractor: SAP National Security Services Inc

Awarding Agency: Department of Defense

Start Date: 2016-03-22

End Date: 2019-03-21

Contract Duration: 1,094 days

Daily Burn Rate: $28.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: IGF::CL,CT::IGF SAP CONSULTING SERVICES

Place of Performance

Location: NEWTOWN SQUARE, DELAWARE County, PENNSYLVANIA, 19073

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $30.7 million to SAP NATIONAL SECURITY SERVICES INC for work described as: IGF::CL,CT::IGF SAP CONSULTING SERVICES Key points: 1. Contract awarded to a single vendor, raising questions about competition. 2. Significant spending on IT consulting services for the Department of the Army. 3. Potential for cost overruns with Time and Materials contract type. 4. The contract falls under 'Other Computer Related Services' NAICS code.

Value Assessment

Rating: fair

The contract value of $30.7M over three years appears high for IT consulting, especially given the lack of competition. Benchmarking against similar SAP consulting contracts would be necessary for a definitive assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was sole-sourced, meaning there was no open competition. This limits price discovery and may lead to higher costs for taxpayers.

Taxpayer Impact: The sole-source nature of this contract likely resulted in a higher price than if it had been competitively bid, impacting taxpayer funds.

Public Impact

Taxpayers may have paid a premium due to the lack of competitive bidding. The Army's reliance on a single vendor for critical SAP services could pose a risk. Transparency in contract spending is crucial for public trust.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Time and Materials contract type
Lack of competition

Positive Signals

Contract awarded to a specialized vendor
Definitive contract provides clear terms

Sector Analysis

This contract falls within the IT consulting sector, specifically focusing on SAP systems. Spending on IT services for defense agencies is substantial, and benchmarks for similar SAP implementations vary widely.

Small Business Impact

The contract was not awarded to a small business. There is no indication of subcontracting opportunities for small businesses in the provided data.

Oversight & Accountability

Oversight is crucial for sole-source contracts to ensure fair pricing and effective service delivery. The Department of the Army should have robust internal controls.

Related Government Programs

Other Computer Related Services
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Lack of competition
Potential for cost overruns (T&M)
Sole-source award
Limited transparency on justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.7 million to SAP NATIONAL SECURITY SERVICES INC. IGF::CL,CT::IGF SAP CONSULTING SERVICES

Who is the contractor on this award?

The obligated recipient is SAP NATIONAL SECURITY SERVICES INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $30.7 million.

What is the period of performance?

Start: 2016-03-22. End: 2019-03-21.

What was the justification for awarding this contract on a sole-source basis?

The justification for a sole-source award typically involves unique capabilities, urgent needs, or a lack of other qualified sources. Without specific documentation, it's difficult to ascertain the precise reason. However, for critical systems like SAP, agencies may argue for specialized vendor expertise.

What measures were in place to control costs under the Time and Materials contract?

Time and Materials (T&M) contracts can be prone to cost overruns if not managed carefully. Agencies typically implement cost ceilings, require detailed timesheets, and conduct regular reviews of labor hours and material costs to maintain control. Effective oversight is paramount.

How does the performance of SAP National Security Services Inc. compare to industry standards for SAP consulting?

Assessing performance requires access to contract performance reports and user feedback, which are not provided. Industry standards for SAP consulting vary based on project complexity and scope. A comparison would necessitate reviewing specific deliverables and outcomes against defined metrics.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: SAP AG (UEI: 316268655)

Address: 3809 W CHESTER PIKE BLDG 1, NEWTOWN SQUARE, PA, 19073

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $30,721,546

Exercised Options: $30,721,546

Current Obligation: $30,721,546

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: YES

Timeline