DoD's $20.4M IT Support Contract Awarded to Deloitte Consulting LLP for Modernization Phase

Contract Overview

Contract Amount: $20,421,570 ($20.4M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Defense

Start Date: 2012-09-15

End Date: 2018-03-14

Contract Duration: 2,006 days

Daily Burn Rate: $10.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: MODERNIZATION PHASE-IT SUPPORT SERVICES

Place of Performance

Location: FREDERICK, FREDERICK County, MARYLAND, 21702

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $20.4 million to DELOITTE CONSULTING LLP for work described as: MODERNIZATION PHASE-IT SUPPORT SERVICES Key points: 1. The contract represents a significant investment in IT modernization, aiming to enhance operational efficiency. 2. Deloitte's selection suggests a focus on established expertise in complex IT systems integration. 3. The firm-fixed-price structure indicates a defined scope and budget, potentially mitigating cost overruns. 4. The contract duration of over 2000 days highlights the long-term nature of the IT modernization effort. 5. Performance in Maryland suggests a concentration of critical IT infrastructure within that region. 6. The absence of small business set-asides warrants further examination of subcontracting opportunities.

Value Assessment

Rating: good

Benchmarking this $20.4 million contract against similar IT support services for the Department of Defense is challenging without more granular data on the specific services rendered. However, the firm-fixed-price (FFP) award type is generally favorable for the government, as it shifts cost risk to the contractor. The duration of the contract (over 2000 days) suggests a substantial and ongoing need for these services. Without comparable contract data, a precise value-for-money assessment is difficult, but the FFP structure is a positive indicator.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. This approach typically fosters a competitive environment, encouraging multiple bidders to offer their best pricing and technical solutions. The fact that it was a single award delivery order suggests that while competition was open, Deloitte was ultimately selected as the most advantageous offer.

Taxpayer Impact: Full and open competition generally leads to better price discovery and potentially lower costs for taxpayers by leveraging the widest possible range of qualified vendors.

Public Impact

The Department of Defense benefits from modernized IT infrastructure, potentially leading to improved mission effectiveness. IT support services are delivered to facilitate the ongoing modernization phase of critical defense systems. The primary geographic impact is likely within Maryland, where the contract is noted to be performed. The contract supports a workforce skilled in IT systems design and support, contributing to the federal IT labor market.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of explicit small business participation or set-aside could limit opportunities for smaller, innovative firms.
The long contract duration might lead to vendor lock-in if not managed carefully with performance reviews.
Dependence on a single contractor for critical IT modernization could pose a risk if performance falters.

Positive Signals

Awarded under full and open competition, suggesting a robust selection process.
Firm-fixed-price contract type helps control costs and manage budget predictability.
Deloitte Consulting LLP is a well-established contractor with significant experience in IT services.

Sector Analysis

This contract falls within the broader IT services sector, specifically Computer Systems Design Services. The federal government is a major consumer of these services, with significant spending allocated annually towards IT modernization, cybersecurity, and infrastructure support across various agencies. The market is characterized by a mix of large prime contractors and specialized subcontractors. This particular contract's value and duration place it as a substantial engagement within the IT support sub-sector for defense agencies.

Small Business Impact

The contract does not indicate any specific small business set-aside provisions (ss: false, sb: false). This suggests that the primary award was made without a specific goal for small business participation. While full and open competition allows for small businesses to compete, the absence of set-asides means their inclusion would depend on their ability to compete directly with larger firms or through subcontracting opportunities. Further analysis would be needed to determine if subcontracting plans were mandated or achieved.

Oversight & Accountability

The contract is a Delivery Order under a larger contract vehicle, implying that oversight mechanisms are likely in place at both the task order and the parent contract level. The firm-fixed-price nature provides some budget oversight. Accountability would be managed through performance metrics and delivery schedules. Transparency is generally facilitated by contract award databases, though specific performance details may be less public. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse.

Related Government Programs

IT Modernization Programs
Defense-Wide IT Support Services
Computer Systems Design Services
Department of the Army IT Contracts
Federal IT Services Procurement

Risk Flags

Long contract duration may increase risk of technological obsolescence.
Potential for scope creep in undefined modernization phases.
Lack of explicit small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.4 million to DELOITTE CONSULTING LLP. MODERNIZATION PHASE-IT SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $20.4 million.

What is the period of performance?

Start: 2012-09-15. End: 2018-03-14.

What is Deloitte Consulting LLP's track record with the Department of Defense, particularly in IT modernization projects?

Deloitte Consulting LLP has a long-standing and extensive track record with the Department of Defense (DoD) across a wide array of services, including IT modernization, cybersecurity, and strategic consulting. They are a major federal contractor frequently awarded significant prime contracts. For IT modernization specifically, Deloitte has been involved in large-scale system implementations, cloud migrations, and digital transformation initiatives for various branches of the military and defense agencies. Their experience often involves complex, mission-critical systems, suggesting a deep understanding of the DoD's unique operational requirements and security protocols. This specific $20.4 million contract for IT support services during a modernization phase aligns with their established capabilities and past performance within the defense sector.

How does the $20.4 million value of this contract compare to other similar IT support services contracts awarded by the Department of the Army?

The $20.4 million value for this IT support services contract awarded to Deloitte Consulting LLP by the Department of the Army is a substantial, but not exceptionally large, figure within the context of major federal IT procurements. The Department of the Army, like other branches of the DoD, regularly awards IT contracts ranging from a few million to hundreds of millions of dollars, particularly for modernization efforts, system sustainment, and enterprise-wide solutions. Contracts for comprehensive IT support, especially those spanning several years (as indicated by the duration of over 2000 days), often fall within this mid-to-high value range. Without knowing the precise scope and deliverables, a direct comparison is difficult, but this contract appears to be a significant investment in a specific modernization phase rather than an enterprise-wide, multi-billion dollar IT overhaul.

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

A primary risk with a firm-fixed-price (FFP) contract of this duration (over 2000 days) for IT support services is scope creep. While FFP aims to fix costs, if the scope of 'modernization phase IT support' is not meticulously defined and managed, the contractor may incur additional costs beyond the fixed price if requirements evolve significantly. Another risk is contractor performance degradation over time; a long contract can lead to complacency or a decline in service quality if not actively managed and incentivized. Furthermore, technological obsolescence is a risk; the IT landscape can change rapidly, and the services defined at the outset might become less relevant or efficient by the contract's end, potentially requiring costly modifications or renegotiations. Finally, if the initial fixed price was set too low due to aggressive bidding, the contractor might struggle to deliver quality services profitably, leading to potential disputes or performance issues.

How effective are firm-fixed-price contracts in ensuring value for money in long-term IT modernization projects?

Firm-fixed-price (FFP) contracts can be effective in ensuring value for money for IT modernization projects when the scope of work is well-defined and stable. The FFP structure incentivizes the contractor to control costs and improve efficiency to maximize profit, which can translate to savings for the government. For a modernization phase, where specific deliverables and timelines are established, FFP provides budget certainty. However, effectiveness diminishes if the project scope is inherently uncertain or prone to significant changes, as this can lead to costly change orders or a contractor cutting corners on quality to maintain profitability. For long-term projects, continuous monitoring and potentially incorporating mechanisms for scope adjustments or performance incentives are crucial to ensure sustained value.

What does the 'Computer Systems Design Services' (NAICS 541512) classification imply about the nature of the services provided under this contract?

The NAICS code 541512, 'Computer Systems Design Services,' indicates that the contract primarily covers services related to planning, designing, and developing computer systems. This typically includes activities such as analyzing user needs, designing system architecture, integrating hardware and software, and providing consulting services on IT infrastructure. For this Department of Defense contract, it suggests that Deloitte Consulting LLP was engaged in activities like architecting new IT solutions, ensuring interoperability between different systems, potentially overseeing the implementation of new software or hardware, and providing expert advice on how to best structure and manage the Army's IT environment during its modernization phase. It implies a focus on the strategic and technical aspects of building and improving computer systems, rather than just routine maintenance or support.

What are the implications of this contract being a 'Delivery Order' (aw: DELIVERY ORDER) rather than a standalone contract?

The designation 'Delivery Order' (aw: DELIVERY ORDER) signifies that this contract is a task order issued under a larger, pre-existing contract vehicle, often a Multiple Award Indefinite Delivery/Indefinite Quantity (IDIQ) contract or a similar master agreement. This implies that the initial competition likely occurred when the parent contract was awarded, establishing terms, conditions, and potentially pricing structures. The issuance of a delivery order means that the Department of the Army exercised an option or placed an order against that established vehicle for specific goods or services, in this case, IT support for modernization. The implications include potentially faster procurement cycles for subsequent needs, established relationships and understanding between the agency and contractor, and that the overall value and scope might be part of a larger, overarching program managed under the parent contract.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: W81XWH12R0022

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $20,421,570

Exercised Options: $20,421,570

Current Obligation: $20,421,570

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $647,600

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q09BGD0018

IDV Type: GWAC

Timeline