Booz Allen Hamilton awarded $91.8M contract for computer systems design services by the Department of the Army

Contract Overview

Contract Amount: $91,807,900 ($91.8M)

Contractor: Booz Allen Hamilton Inc

Awarding Agency: Department of Defense

Start Date: 2016-09-28

End Date: 2023-09-16

Contract Duration: 2,544 days

Daily Burn Rate: $36.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::OT::IGF

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $91.8 million to BOOZ ALLEN HAMILTON INC for work described as: IGF::OT::IGF Key points: 1. Contract value of $91.8 million over approximately 7 years indicates a significant investment in IT services. 2. The contract was awarded using full and open competition, suggesting a competitive bidding process. 3. The firm-fixed-price contract type suggests that the contractor assumes the risk for cost overruns. 4. The contract's duration of 2544 days (approx. 7 years) points to a long-term need for these services. 5. The primary NAICS code (541512) indicates a focus on computer systems design. 6. The award to a single contractor, Booz Allen Hamilton, highlights their established position in this service area.

Value Assessment

Rating: good

The contract value of $91.8 million over nearly seven years averages to approximately $13.1 million annually. Benchmarking this against similar large-scale IT services contracts for the Department of Defense suggests this is within a reasonable range for complex system design and integration. The firm-fixed-price nature of the award also indicates a degree of pricing certainty for the government, assuming the scope of work remains stable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. With three bidders participating, the competition level appears moderate. This suggests that while multiple companies vied for the contract, the market may not be as broad as for more commoditized services, potentially influencing price discovery.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation. The presence of multiple bidders suggests that taxpayer funds are likely being used efficiently, as the government sought the best value from a range of qualified providers.

Public Impact

The Department of the Army benefits from specialized computer systems design and integration services to support its operational needs. This contract likely supports critical military functions and infrastructure through advanced IT solutions. The services delivered are expected to enhance the efficiency and effectiveness of Army systems. The geographic impact is primarily within the Department of the Army's operational areas, potentially worldwide. The contract supports skilled IT professionals, contributing to the federal IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to scope creep if not managed tightly.
Reliance on a single large contractor may limit future flexibility or access to emerging technologies.
Firm-fixed-price contracts can sometimes disincentivize innovation if not structured with clear performance incentives.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
Firm-fixed-price structure provides cost certainty for the government.
Contractor, Booz Allen Hamilton, is a well-established entity with significant experience in government IT services.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer systems design and integration. This market segment is characterized by high demand from government agencies requiring sophisticated technological solutions. The total addressable market for such services within the federal government is substantial, with agencies continually investing in modernizing their IT infrastructure. Comparable spending benchmarks for similar system design contracts often range from tens to hundreds of millions of dollars, depending on complexity and duration.

Small Business Impact

This contract does not appear to have a small business set-aside (ss: false, sb: false). Therefore, there are no direct subcontracting requirements mandated for small businesses within this award. The primary contractor, Booz Allen Hamilton, is a large business, and its subcontracting practices for this specific contract would need to be monitored separately if they choose to engage small businesses for specific components or services.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Department of the Army. Performance reviews, regular reporting, and milestone tracking are standard accountability measures. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction may apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense IT Modernization Programs
Army Command and Control Systems
Defense Information Systems Agency (DISA) Contracts
Federal Civilian IT Services
Enterprise Resource Planning (ERP) System Development

Risk Flags

Long-term contract duration requires diligent oversight to prevent scope creep.
Potential for vendor lock-in with a single large provider over an extended period.
Firm-fixed-price contracts can sometimes limit flexibility in adapting to rapidly changing technological landscapes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $91.8 million to BOOZ ALLEN HAMILTON INC. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is BOOZ ALLEN HAMILTON 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 $91.8 million.

What is the period of performance?

Start: 2016-09-28. End: 2023-09-16.

What is Booz Allen Hamilton's track record with the Department of Defense for similar IT services?

Booz Allen Hamilton has a long and extensive history of providing IT and management consulting services to the Department of Defense (DoD) and its various branches, including the Department of the Army. Their portfolio includes a wide range of support, from cybersecurity and data analytics to systems engineering and integration. The company has been a significant contractor for the DoD for decades, consistently securing large-value contracts. Their performance on previous DoD contracts, while generally positive, has also faced scrutiny at times, as is common for large, long-term engagements. Analyzing specific past performance metrics and any associated corrective actions would provide a more granular view of their reliability for this particular contract.

How does the $91.8 million contract value compare to other computer systems design contracts awarded by the Army in the last five years?

The $91.8 million contract value for computer systems design services awarded to Booz Allen Hamilton is substantial but falls within the typical range for large-scale, multi-year IT support contracts within the Department of the Army. The Army frequently awards contracts in the tens to hundreds of millions of dollars for complex system design, development, and integration. For instance, contracts for enterprise resource planning (ERP) systems, command and control (C2) systems, or major network infrastructure upgrades often exceed this amount. When compared to the average contract size for NAICS code 541512 within the Army over the past five years, this award appears to be in the upper quartile, reflecting a significant scope of work and duration.

What are the primary risks associated with a firm-fixed-price contract of this duration?

The primary risks associated with a firm-fixed-price (FFP) contract of this duration (approximately 7 years) revolve around scope definition and potential for cost escalation beyond the contractor's control. For the government, the risk is that the initial scope may become outdated or insufficient as technology evolves or mission requirements change, potentially leading to costly change orders or the need for a new contract. For the contractor, the risk is that unforeseen technical challenges, increased labor costs, or material price increases could erode profit margins if not adequately accounted for in the initial pricing. Effective contract management, including robust change control processes and regular performance reviews, is crucial to mitigate these risks.

What does the moderate competition level (3 bidders) imply for the government's ability to secure the best possible pricing?

A moderate competition level, with three bidders, suggests that while the government benefited from multiple proposals, the market may not be saturated with providers for this specific type of specialized computer systems design service. In highly competitive markets with numerous bidders, prices are often driven down more aggressively. With three bidders, the government likely achieved a competitive price, but there might have been potential for even greater savings if more firms had participated. The government's negotiation strategy and the specific technical requirements of the solicitation would also play a significant role in the final price achieved. It indicates a balance between having sufficient choice and potentially facing a more limited pool of highly qualified specialists.

How has federal spending on computer systems design services (NAICS 541512) trended over the past decade?

Federal spending on computer systems design services (NAICS 541512) has generally trended upwards over the past decade, driven by the continuous need for agencies to modernize IT infrastructure, enhance cybersecurity, and adopt new technologies like cloud computing and artificial intelligence. While specific year-over-year fluctuations occur based on budget cycles and agency priorities, the overall trajectory reflects a sustained investment in IT modernization. The Department of Defense, as a major technology consumer, represents a significant portion of this spending. Factors such as increased cyber threats and the push for digital transformation across government have further fueled demand for these specialized services.

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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W52P1J16R0047

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Booz Allen Hamilton Holding Corporation

Address: 8283 GREENSBORO DR, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $91,807,900

Exercised Options: $91,807,900

Current Obligation: $91,807,900

Actual Outlays: $1,240,322

Subaward Activity

Number of Subawards: 24

Total Subaward Amount: $11,020,818

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline