DoD's $32.9M contract for legacy system rationalization awarded to Deloitte Consulting LLP

Contract Overview

Contract Amount: $32,907,562 ($32.9M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Defense

Start Date: 2018-04-16

End Date: 2021-11-15

Contract Duration: 1,309 days

Daily Burn Rate: $25.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::OT::IGF PROVIDE THE ANALYTIC SUPPORT TO IDENTIFY, MANAGE, EVALUATE, AND RECOMMEND SOLUTIONS TO SUPPORT THE PORTFOLIO RATIONALIZATION EFFORT TO TRANSITION THE LEGACY SYSTEMS CAPABILITY AND TO IDENTIFY COURSE OF ACTION FOR THE SYSTEMS IDENTIFIED FOR CONSOLIDATION OR TERMINATION. THIS EFFORT SHALL BE EXECUTED USING THE SYMANTEC OPEN SOURCE SOFTWARE (SEMOSS) TOOL.

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22209

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $32.9 million to DELOITTE CONSULTING LLP for work described as: IGF::OT::IGF PROVIDE THE ANALYTIC SUPPORT TO IDENTIFY, MANAGE, EVALUATE, AND RECOMMEND SOLUTIONS TO SUPPORT THE PORTFOLIO RATIONALIZATION EFFORT TO TRANSITION THE LEGACY SYSTEMS CAPABILITY AND TO IDENTIFY COURSE OF ACTION FOR THE SYSTEMS IDENTIFIED FOR CONSOLIDATION OR TERMINATIO… Key points: 1. Contract focuses on identifying, managing, and evaluating solutions for transitioning legacy systems. 2. Utilizes Symantec's open-source software (SEMOSS) for analysis. 3. Awarded under full and open competition, indicating broad market engagement. 4. Firm Fixed Price contract type suggests defined scope and cost control. 5. Duration of 1309 days highlights a significant, long-term project. 6. Small business participation was not a stated requirement or outcome.

Value Assessment

Rating: good

The contract value of $32.9 million over approximately 3.5 years for administrative management and general management consulting services appears reasonable for a large-scale system rationalization effort within the Department of Defense. Benchmarking against similar large-scale IT modernization and consulting contracts within federal agencies suggests that this pricing is within expected ranges, especially considering the complexity of transitioning legacy systems and the use of specialized software tools. The firm fixed-price nature of the contract provides cost certainty for the government.

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 offers. While the specific number of bidders is not provided, this method generally fosters a competitive environment, encouraging multiple firms to propose their best solutions and pricing. This approach is intended to ensure the government receives the most advantageous offer.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically drives down costs and improves the quality of services received by ensuring a wide range of potential providers are considered.

Public Impact

The Department of Defense benefits from improved efficiency and reduced costs associated with managing legacy systems. Services delivered include analytical support for identifying, managing, and evaluating solutions for system transition and consolidation. The geographic impact is primarily within the Department of Defense's operational footprint, with potential benefits to its IT infrastructure nationwide. Workforce implications may involve the redeployment or retraining of personnel as legacy systems are phased out.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if the definition of 'legacy systems' is not tightly controlled.
Reliance on a specific software tool (SEMOSS) could introduce vendor lock-in risks if not managed properly.
Ensuring effective knowledge transfer from Deloitte to internal DoD personnel for long-term sustainment.

Positive Signals

Clear objective to rationalize and transition legacy systems, aiming for modernization and cost savings.
Use of a specialized tool (SEMOSS) suggests a data-driven and potentially efficient analytical approach.
Firm fixed-price contract provides budget predictability for the government.

Sector Analysis

This contract falls within the Management and Consulting Services sector, specifically focusing on administrative and general management consulting. The federal market for such services is substantial, driven by agencies' needs for expertise in areas like IT modernization, process improvement, and strategic planning. The Department of Defense, in particular, represents a significant portion of this spending due to the complexity and scale of its operations and IT infrastructure. This contract aligns with broader government initiatives to modernize IT systems and improve operational efficiency.

Small Business Impact

The contract was awarded under full and open competition and does not indicate any specific small business set-aside. There is no explicit mention of subcontracting goals for small businesses. This suggests that the primary focus was on securing the best overall solution from the broader market, rather than prioritizing small business participation through set-asides for this particular award.

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. The firm fixed-price nature provides a degree of accountability for cost. Transparency is facilitated by the contract award being publicly available. The Inspector General's office may conduct audits or investigations if specific concerns regarding performance or financial integrity arise.

Related Government Programs

Department of Defense IT Modernization Programs
Federal IT Consulting Services
Legacy System Modernization Contracts
Administrative Management Consulting
General Management Consulting Services

Risk Flags

Potential for vendor lock-in with SEMOSS tool
Risk of inadequate scope definition for legacy systems
Dependency on contractor expertise for critical analysis
Challenges in integrating findings with existing DoD processes

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.9 million to DELOITTE CONSULTING LLP. IGF::OT::IGF PROVIDE THE ANALYTIC SUPPORT TO IDENTIFY, MANAGE, EVALUATE, AND RECOMMEND SOLUTIONS TO SUPPORT THE PORTFOLIO RATIONALIZATION EFFORT TO TRANSITION THE LEGACY SYSTEMS CAPABILITY AND TO IDENTIFY COURSE OF ACTION FOR THE SYSTEMS IDENTIFIED FOR CONSOLIDATION OR TERMINATION. THIS EFFORT SHALL BE EXECUTED USING THE SYMANTEC OPEN SOURCE SOFTWARE (SEMOSS) TOOL.

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 $32.9 million.

What is the period of performance?

Start: 2018-04-16. End: 2021-11-15.

What is the specific track record of Deloitte Consulting LLP in managing large-scale federal IT system rationalization projects?

Deloitte Consulting LLP has a well-established track record of providing management and IT consulting services to federal agencies, including the Department of Defense. They have been involved in numerous large-scale projects related to system modernization, digital transformation, and enterprise resource planning (ERP) implementations. Their experience often includes complex environments with legacy systems, requiring strategic planning, process re-engineering, and technology integration. While specific details on past system rationalization projects are proprietary, their consistent awards and presence in the federal IT consulting space indicate a capacity to handle such complex endeavors. Performance metrics and past performance evaluations from previous contracts would provide a more granular view of their success in similar engagements.

How does the value of this contract compare to similar federal contracts for IT system rationalization and consulting services?

The $32.9 million contract value for system rationalization and consulting services over approximately 3.5 years is within the expected range for large-scale federal IT projects. Similar contracts awarded to major consulting firms for comprehensive IT modernization, system integration, and strategic planning within large agencies like the DoD, HHS, or DHS often fall within the tens to hundreds of millions of dollars. Factors influencing this value include the scope of systems to be analyzed, the complexity of the existing infrastructure, the duration of the effort, and the specific methodologies or tools employed. Given the objective of transitioning legacy capabilities and identifying courses of action for consolidation or termination, this investment appears proportionate to the potential long-term cost savings and efficiency gains anticipated from such an initiative.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include the potential for scope creep, where the definition of 'legacy systems' or the required analytical depth expands beyond initial expectations, leading to cost overruns or schedule delays. Another risk is the successful adoption and utilization of the specified SEMOSS tool; if the tool proves inadequate or difficult to implement, it could hinder the analytical process. Furthermore, ensuring effective knowledge transfer and buy-in from internal DoD stakeholders is crucial for the long-term success and sustainability of the rationalization efforts. Mitigation strategies likely involve robust contract management, clearly defined deliverables and milestones, regular progress reviews, and proactive stakeholder engagement. The firm fixed-price structure also incentivizes the contractor to manage scope effectively.

What is the expected program effectiveness and impact of this contract on the Department of the Army's IT infrastructure?

The expected effectiveness of this contract lies in its potential to significantly streamline the Department of the Army's IT infrastructure by identifying and addressing redundant, outdated, or inefficient legacy systems. By rationalizing these systems, the Army can anticipate reduced maintenance costs, improved cybersecurity posture, enhanced operational agility, and better data integration capabilities. The identification of courses of action for consolidation or termination aims to create a more modern, cost-effective, and secure IT environment. Ultimately, this should lead to improved mission support and resource allocation, allowing the Army to focus investments on more strategic and advanced technological capabilities.

How has federal spending on administrative management and general management consulting services evolved, and where does this contract fit?

Federal spending on administrative management and general management consulting services has consistently been a significant category, driven by agencies' needs for external expertise to improve efficiency, manage complex programs, and navigate technological changes. Over the past decade, there has been a notable shift towards IT-related consulting, including cybersecurity, cloud migration, and data analytics, often integrated within broader management consulting efforts. This $32.9 million contract for legacy system rationalization fits within this trend, specifically addressing the critical need for IT infrastructure modernization within a major defense agency. It represents a substantial investment in optimizing foundational IT capabilities, reflecting the government's ongoing commitment to updating its technological backbone.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte Touche Tohmatsu Limited

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: $39,741,258

Exercised Options: $32,907,562

Current Obligation: $32,907,562

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $291,359

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47QRAA18D001P

IDV Type: FSS

Timeline