DoD's $522M Battle Command Training Program Services Contract Awarded to Northrop Grumman

Contract Overview

Contract Amount: $522,176,400 ($522.2M)

Contractor: Northrop Grumman Technical Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2011-08-03

End Date: 2020-01-14

Contract Duration: 3,086 days

Daily Burn Rate: $169.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: BATTLE COMMAND TRAINING PROGRAM SERVICES

Place of Performance

Location: FORT LEAVENWORTH, LEAVENWORTH County, KANSAS, 66027

State: Kansas Government Spending

Plain-Language Summary

Department of Defense obligated $522.2 million to NORTHROP GRUMMAN TECHNICAL SERVICES, INC. for work described as: BATTLE COMMAND TRAINING PROGRAM SERVICES Key points: 1. Contract awarded to a single large business, Northrop Grumman, indicating potential market concentration. 2. The contract spans nearly 8.5 years, suggesting a long-term need for these services. 3. Services fall under 'Other Computer Related Services', a broad category with varying cost benchmarks. 4. The 'Cost Plus Award Fee' contract type can incentivize performance but may lead to higher costs if not managed carefully. 5. The absence of small business participation is noted.

Value Assessment

Rating: fair

The contract's Cost Plus Award Fee structure makes direct pricing comparison difficult without detailed award fee criteria and performance data. The total award value of over $522 million over nearly 8.5 years suggests a significant investment, but the value proposition is contingent on achieved performance metrics.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is generally positive for price discovery. However, the specific nature of 'Battle Command Training Program Services' might limit the number of capable bidders, potentially impacting the competitive intensity despite the open solicitation.

Taxpayer Impact: While competition was sought, the long duration and specific service nature could lead to less aggressive pricing over time compared to shorter, more frequent procurements. The Cost Plus Award Fee structure also introduces variability in the final taxpayer cost.

Public Impact

Ensures readiness for military command staff through advanced training simulations. Supports technological integration and operational effectiveness in complex military scenarios. Impacts the development and sustainment of critical defense training infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration may reduce competitive pressure over time.
Cost Plus Award Fee structure can lead to cost overruns if not tightly managed.
No small business participation noted.

Positive Signals

Awarded under full and open competition.
Contract aims to enhance critical military training capabilities.
Significant investment in defense readiness.

Sector Analysis

The IT services sector, particularly specialized training and simulation, is a significant area of government spending. Benchmarks for 'Other Computer Related Services' vary widely based on complexity and duration, making direct comparisons challenging without specific service details.

Small Business Impact

This contract did not include small business participation. Given the large value and specialized nature of the services, it's possible that small businesses were not deemed capable or were not actively sought for this specific prime contract.

Oversight & Accountability

The 'Cost Plus Award Fee' structure implies performance metrics are set, and oversight is required to ensure these metrics are met and that costs are reasonable. The long duration necessitates ongoing monitoring by the Department of the Army to ensure continued value and accountability.

Related Government Programs

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

Risk Flags

Cost Plus Award Fee (CPAF) contract type.
Long contract duration (over 8 years).
No small business participation.
Broad NAICS code (541519) lacks specificity.
Potential for technological obsolescence over contract life.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $522.2 million to NORTHROP GRUMMAN TECHNICAL SERVICES, INC.. BATTLE COMMAND TRAINING PROGRAM SERVICES

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN TECHNICAL 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 $522.2 million.

What is the period of performance?

Start: 2011-08-03. End: 2020-01-14.

What specific performance metrics are tied to the award fee, and how have they impacted the final cost to taxpayers?

The specific performance metrics for the award fee are not detailed in the provided data. These metrics typically relate to contractor performance in areas such as timeliness, quality, and meeting program objectives. Understanding these metrics is crucial for assessing whether the 'award' portion of the fee truly reflects exceptional value or simply standard performance, directly impacting the final cost incurred by taxpayers.

Given the 'Other Computer Related Services' NAICS code, what are the key risks associated with the long-term cost and technological relevance of this contract?

The primary risks include potential cost overruns due to the Cost Plus Award Fee structure and the rapid evolution of technology in computer-related services. A long-term contract may lock the government into outdated solutions or require significant modifications, increasing costs. Ensuring the contractor remains innovative and that the services remain relevant throughout the contract's duration requires diligent oversight and potentially contract modifications.

How effectively did the 'full and open competition' process ensure competitive pricing for these specialized training services over the contract's lifespan?

While 'full and open competition' theoretically maximizes the potential bidder pool, the specialized nature of 'Battle Command Training Program Services' may have limited the number of truly capable and competitive bidders. The long duration (nearly 8.5 years) also raises questions about sustained price competitiveness. The Cost Plus Award Fee structure further complicates assessing the effectiveness of the initial competition in securing optimal long-term pricing.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W911S011R0005

Offers Received: 2

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation

Address: 2411 DULLES CORNER PARK STE 800, HERNDON, VA, 20171

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

Financial Breakdown

Contract Ceiling: $573,060,450

Exercised Options: $529,001,464

Current Obligation: $522,176,400

Actual Outlays: $523,004

Subaward Activity

Number of Subawards: 988

Total Subaward Amount: $1,294,054,117

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline