DoD's $21.2M algorithm development contract with General Dynamics saw 2 bids over 6.7 years
Contract Overview
Contract Amount: $21,258,426 ($21.3M)
Contractor: General Dynamics Mission Systems, Inc.
Awarding Agency: Department of Defense
Start Date: 2006-07-28
End Date: 2013-02-28
Contract Duration: 2,407 days
Daily Burn Rate: $8.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: PHASE I - ALGORITHM DEVELOPMENT
Place of Performance
Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22033
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $21.3 million to GENERAL DYNAMICS MISSION SYSTEMS, INC. for work described as: PHASE I - ALGORITHM DEVELOPMENT Key points: 1. The contract's duration significantly exceeded its initial estimate, suggesting potential scope creep or extended development needs. 2. While the contract was competed, the low number of bids warrants scrutiny of market accessibility and potential barriers to entry. 3. The Cost Plus Fixed Fee (CPFF) pricing structure can incentivize cost overruns, requiring robust oversight. 4. The lack of small business participation raises questions about equitable opportunity and potential missed subcontracting benefits. 5. The contract's completion in 2013 means current relevance and impact require further investigation. 6. Engineering services are critical for defense, but the specific value derived from this particular algorithm development is unclear without further context.
Value Assessment
Rating: fair
Benchmarking the value of this $21.2 million contract is challenging due to its age and the specific nature of 'Algorithm Development'. The Cost Plus Fixed Fee (CPFF) structure, while common for R&D, carries inherent risks of cost escalation. Without comparable contracts for similar algorithm development phases, assessing whether the final cost represented good value for money is difficult. The extended duration also suggests that the initial cost estimates may have been significantly underestimated or that the project scope evolved considerably.
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. However, only two bids were received. This limited competition could suggest that the market for this specific type of specialized engineering service is narrow, or that other potential bidders faced barriers to entry or chose not to participate for strategic reasons. The low number of bidders may have reduced price pressure compared to a more robustly competed contract.
Taxpayer Impact: While full and open competition is generally beneficial for taxpayers, the low bid count suggests that the government may not have achieved the most competitive pricing possible. This could translate to higher costs for taxpayers than if more firms had vied for the contract.
Public Impact
The primary beneficiary is the Department of Defense, which received algorithm development services crucial for its operations. The services delivered were focused on the research and development phase of advanced algorithms, likely for defense applications. The geographic impact is primarily within Virginia, where the Defense Contract Management Agency (DCMA) oversees contracts. Workforce implications include employment for engineers and technical specialists at General Dynamics Mission Systems, Inc.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The Cost Plus Fixed Fee (CPFF) contract type can lead to cost overruns if not managed diligently.
- The extended period of performance (2407 days) significantly exceeded the initial duration, raising concerns about planning and potential scope creep.
- Only two bids were received, indicating potentially limited competition and reduced price discovery.
- The contract was not set aside for small businesses, potentially limiting opportunities for smaller innovative firms.
Positive Signals
- The contract was awarded under full and open competition, maximizing the pool of potential offerors.
- General Dynamics Mission Systems, Inc. is a large, established defense contractor with a significant track record.
- The contract aimed to develop algorithms, a critical component for advancing defense technology.
Sector Analysis
This contract falls within the Engineering Services sector (NAICS 541330), a critical component of the broader defense industrial base. The market for specialized defense engineering services is characterized by high barriers to entry, significant R&D investment, and close relationships with government agencies. Spending in this sector is substantial, driven by the need for technological superiority. Comparable spending benchmarks would typically involve other large-scale R&D or system integration contracts awarded by the DoD to major defense contractors.
Small Business Impact
This contract was not awarded as a small business set-aside, and the prime contractor, General Dynamics Mission Systems, Inc., is a large business. There is no explicit information provided regarding subcontracting plans or performance. The lack of small business participation as a prime contractor means that opportunities for small businesses to contribute to this specific project were likely limited to subcontracting roles, if any were solicited or fulfilled.
Oversight & Accountability
Oversight for this contract would have been primarily managed by the Defense Contract Management Agency (DCMA), responsible for contract administration and ensuring compliance with terms and conditions. The Cost Plus Fixed Fee structure necessitates rigorous financial oversight to monitor costs and ensure the fixed fee remains appropriate. Transparency regarding the specific algorithms developed and their application is likely limited due to national security considerations. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.
Related Government Programs
- Department of Defense Research and Development Contracts
- Engineering Services Contracts
- Algorithm Development Programs
- Cost Plus Fixed Fee Contracts
- Major Defense Acquisition Programs
Risk Flags
- Extended Period of Performance
- Limited Competition (2 Bids)
- Cost Plus Fixed Fee Contract Type
Tags
defense, department-of-defense, general-dynamics-mission-systems, engineering-services, algorithm-development, definitive-contract, cost-plus-fixed-fee, full-and-open-competition, virginia, large-business, research-and-development
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $21.3 million to GENERAL DYNAMICS MISSION SYSTEMS, INC.. PHASE I - ALGORITHM DEVELOPMENT
Who is the contractor on this award?
The obligated recipient is GENERAL DYNAMICS MISSION SYSTEMS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $21.3 million.
What is the period of performance?
Start: 2006-07-28. End: 2013-02-28.
What was the specific purpose and intended application of the algorithms developed under this contract?
The provided data indicates the contract was for 'PHASE I - ALGORITHM DEVELOPMENT' under the Department of Defense. While the specific application is not detailed, algorithm development in a defense context typically supports areas such as intelligence analysis, command and control systems, sensor data processing, simulation and modeling, or autonomous systems. Phase I often focuses on foundational research, feasibility studies, and initial design concepts. Without access to the contract's statement of work or related documentation, the precise purpose remains unspecified, but it was clearly intended to advance a defense capability through software and computational logic.
How did the final cost of $21.2 million compare to initial estimates for this algorithm development phase?
The provided data does not include initial cost estimates, making a direct comparison impossible. However, the contract's duration of 2407 days (approximately 6.7 years) significantly exceeded typical timelines for a Phase I development effort, suggesting that either the initial estimates were highly inaccurate, the scope evolved substantially, or the project encountered unforeseen challenges. For Cost Plus Fixed Fee (CPFF) contracts, the final cost is a result of allowable costs incurred plus a predetermined fixed fee. If the initial estimates were low, the final cost could be significantly higher than anticipated, especially over an extended period.
What were the key performance metrics used to evaluate the success of General Dynamics Mission Systems, Inc. on this contract?
The provided data does not specify the key performance metrics (KPIs) for this contract. For algorithm development contracts, especially those using a CPFF structure, performance is typically evaluated based on the successful development and delivery of functional algorithms meeting specified technical requirements, adherence to project milestones, and effective management of resources. Given the extended duration, metrics might also include the efficiency of development cycles and the adaptability of the algorithms to evolving requirements. Formal performance reports and contractor assessments would contain this information, which is not publicly available in the provided snippet.
What is the typical market rate or cost range for similar algorithm development contracts within the DoD?
Determining a precise 'market rate' for algorithm development is complex due to the highly specialized nature of the work, varying levels of complexity, and different contract types (e.g., CPFF, FFP, T&M). However, contracts for advanced algorithm development within the DoD can range from hundreds of thousands to tens or even hundreds of millions of dollars, depending on the phase (e.g., R&D vs. production), scope, and technology readiness level. A $21.2 million contract over nearly seven years for Phase I suggests a significant undertaking, potentially involving complex modeling, simulation, or foundational AI/ML research, placing it in the mid-to-high range for such development efforts.
Were there any identified risks or challenges during the contract's performance, and how were they mitigated?
The provided data does not detail specific risks or mitigation strategies employed during the contract's performance. However, common risks in long-duration R&D contracts include technological obsolescence, changing requirements, difficulty in recruiting specialized talent, and cost overruns, particularly with CPFF contracts. The extended performance period itself suggests potential challenges in meeting initial timelines or scope. Mitigation efforts would typically involve proactive project management, regular technical reviews, adaptive planning, and close collaboration between the contractor and the government contracting officer's representative (COR).
What is the track record of General Dynamics Mission Systems, Inc. in delivering similar algorithm development or engineering services contracts for the DoD?
General Dynamics Mission Systems, Inc. (GDMS) has a substantial and well-established track record with the Department of Defense, delivering a wide array of complex engineering, technology, and mission systems. They are a major prime contractor involved in numerous large-scale defense programs. While this specific contract focused on algorithm development, GDMS routinely engages in R&D, software development, systems integration, and advanced technology projects for various military branches. Their extensive experience suggests a high capability in managing complex technical efforts, though the success of any individual contract depends on specific program requirements and execution.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: General Dynamics Corp
Address: 1200 JOE HALL DRIVE, YPSILANTI, MI, 48197
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $28,964,788
Exercised Options: $21,258,426
Current Obligation: $21,258,426
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2006-07-28
Current End Date: 2013-02-28
Potential End Date: 2013-02-28 00:00:00
Last Modified: 2025-03-18
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