DoD's $23.7M IT contract with General Dynamics awarded via full and open competition

Contract Overview

Contract Amount: $23,680,443 ($23.7M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-04-21

End Date: 2024-09-26

Contract Duration: 1,254 days

Daily Burn Rate: $18.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: MANAGED SERVICE PROVIDER (MSP)

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22030

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $23.7 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: MANAGED SERVICE PROVIDER (MSP) Key points: 1. Contract awarded for computer systems design services, indicating a need for specialized IT support. 2. The contract duration of 1254 days suggests a long-term requirement for managed services. 3. Awarded as a delivery order, it likely represents a specific task within a larger framework. 4. The use of Time and Materials pricing may lead to cost variability depending on actual effort. 5. General Dynamics Information Technology, Inc. is a significant player in the federal IT contracting space. 6. The contract's value is substantial, reflecting the complexity and scope of managed IT services.

Value Assessment

Rating: good

The contract value of approximately $23.7 million over its period of performance is within a reasonable range for managed IT services provided to a large federal agency like the Department of Defense. Benchmarking against similar large-scale IT support contracts for defense agencies suggests that the overall award amount is competitive. However, the Time and Materials (T&M) pricing structure warrants close monitoring to ensure that costs remain aligned with the value delivered and do not escalate beyond initial expectations.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of 4 bidders suggests a healthy level of competition for this significant IT services requirement. A competitive bidding process generally leads to better price discovery and encourages vendors to offer their most competitive terms and solutions.

Taxpayer Impact: Taxpayers benefit from a competitive award process, as it is more likely to result in a fair market price for the services rendered, preventing potential overpayment.

Public Impact

The Department of the Army benefits from enhanced IT infrastructure and managed services, ensuring operational readiness. This contract supports the delivery of critical computer systems design and integration services. The geographic impact is primarily within the Department of Defense's operational footprint, likely supporting various installations. Workforce implications include the potential for employment opportunities within General Dynamics and its subcontractors, supporting specialized IT roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials (T&M) pricing can lead to cost overruns if not carefully managed and monitored.
The long contract duration (1254 days) may present challenges in adapting to rapidly evolving IT technologies.
Reliance on a single large contractor for critical IT services could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, ensuring a competitive selection process.
General Dynamics Information Technology, Inc. has a significant track record in federal IT contracting.
The contract addresses a clear need for managed IT services within a major federal agency.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on computer systems design and related services. The federal IT market is vast, with agencies consistently investing in modernizing and maintaining their digital infrastructure. Contracts for managed service providers (MSPs) like this one are common, as agencies increasingly outsource complex IT operations to specialized firms. The value of this contract is significant, reflecting the scale of IT support required by a major defense component.

Small Business Impact

This contract was not set aside for small businesses, and there is no explicit indication of subcontracting requirements for small businesses. The award to a large prime contractor like General Dynamics suggests that the primary focus was on capability and capacity rather than small business participation. Further analysis would be needed to determine if any subcontracting opportunities were made available to the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program management office within the Department of the Army. Performance monitoring, invoicing review, and adherence to contract terms are standard oversight mechanisms. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance metrics may not always be publicly disclosed.

Related Government Programs

IT Managed Services
Computer Systems Design Services
Defense IT Modernization
Department of Defense IT Support
Information Technology Professional Services

Risk Flags

Potential for cost overruns due to Time and Materials pricing structure.
Long contract duration may not keep pace with rapid technological advancements.
Reliance on a single large contractor for critical IT functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.7 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. MANAGED SERVICE PROVIDER (MSP)

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, 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 $23.7 million.

What is the period of performance?

Start: 2021-04-21. End: 2024-09-26.

What is General Dynamics Information Technology, Inc.'s track record with similar IT managed services contracts for the Department of Defense?

General Dynamics Information Technology, Inc. (GDIT) has a substantial and long-standing track record of providing IT managed services and complex technology solutions to the Department of Defense and other federal agencies. They are a major federal contractor with extensive experience in areas such as network operations, cybersecurity, cloud computing, and systems integration. GDIT has held numerous large-scale contracts with various branches of the military, including the Army, Navy, and Air Force, often involving mission-critical systems. Their performance on these contracts is generally viewed as robust, though like any large contractor, specific contract performance can vary. Publicly available contract data and past performance reviews would offer more granular insights into their specific successes and challenges on prior engagements.

How does the per-unit cost or labor rate for this contract compare to market rates for similar IT managed services?

Determining an exact per-unit cost or labor rate comparison for this Time and Materials (T&M) contract is challenging without access to the detailed pricing structure and the specific labor categories and hours billed. T&M contracts are inherently variable. However, the overall contract value of approximately $23.7 million over roughly 3.2 years (1254 days) suggests an average annual spend of around $7.4 million. When benchmarked against industry reports for IT managed services for large federal clients, this annual spend is within a plausible range. To conduct a precise comparison, one would need to analyze the billed hours for specific roles (e.g., system administrators, network engineers, cybersecurity analysts) against prevailing government and commercial labor rate data for the Washington D.C. metropolitan area or relevant geographic locations.

What are the primary risks associated with a Time and Materials (T&M) contract of this magnitude and duration?

The primary risk associated with a Time and Materials (T&M) contract of this magnitude ($23.7 million) and duration (1254 days) is the potential for cost overruns and a lack of definitive cost control. Unlike fixed-price contracts, T&M contracts pay the contractor for the actual time and materials expended. This can lead to unpredictable costs if the scope of work is not well-defined, if project inefficiencies occur, or if the contractor does not diligently manage resources. For the government, the risk is paying for potentially inefficient labor or inflated material costs without a clear ceiling. Effective oversight, detailed tracking of hours and materials, and strong program management are crucial to mitigate these risks and ensure value for money.

How does this contract align with the Department of Defense's broader IT modernization and digital transformation goals?

This contract for managed IT services directly supports the Department of Defense's (DoD) ongoing efforts in IT modernization and digital transformation. By outsourcing the management and design of computer systems to a specialized provider like General Dynamics Information Technology, the DoD can focus its internal resources on strategic initiatives, policy development, and core warfighting capabilities. Such contracts enable the adoption of new technologies, improve system reliability and security, and enhance the overall efficiency of IT operations. The long duration suggests a commitment to stable, long-term support necessary for complex modernization projects, aligning with the DoD's need for resilient and advanced technological infrastructure to maintain its operational edge.

What has been the historical spending trend for computer systems design services by the Department of the Army?

The Department of the Army, like other branches of the DoD, consistently allocates significant funding towards computer systems design services and broader IT support. Historical spending data indicates a sustained and often increasing investment in this category over the past decade, driven by the need to maintain legacy systems, upgrade infrastructure, and adopt new digital capabilities. Factors such as evolving cyber threats, the push for cloud migration, and the integration of advanced technologies like AI and data analytics contribute to this trend. While specific annual figures fluctuate based on agency priorities and budget allocations, the overall trajectory shows a strong and continuous demand for these services, making contracts like this one a recurring necessity.

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 - COMPUTE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

Address: 3211 JERMANTOWN RD, FAIRFAX, VA, 22030

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

Financial Breakdown

Contract Ceiling: $103,171,496

Exercised Options: $23,680,443

Current Obligation: $23,680,443

Subaward Activity

Number of Subawards: 15

Total Subaward Amount: $55,596,994

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 47QTCK18D0003

IDV Type: GWAC

Timeline