Booz Allen Hamilton awarded $93.4M for Army SPMO support, raising questions about competition and value

Contract Overview

Contract Amount: $93,396,890 ($93.4M)

Contractor: Booz Allen Hamilton Inc

Awarding Agency: Department of Defense

Start Date: 2015-01-01

End Date: 2023-09-30

Contract Duration: 3,194 days

Daily Burn Rate: $29.2K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: IGF::OT::IGF SWORD PROGRAM OFFICE (SPMO) SUPPORT

Plain-Language Summary

Department of Defense obligated $93.4 million to BOOZ ALLEN HAMILTON INC for work described as: IGF::OT::IGF SWORD PROGRAM OFFICE (SPMO) SUPPORT Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery. 2. Significant duration of over 8 years suggests long-term reliance. 3. Cost-plus fixed fee structure may incentivize higher costs. 4. Lack of small business participation noted. 5. Services fall under broad consulting category, requiring detailed performance review. 6. High contract value warrants scrutiny of efficiency and effectiveness.

Value Assessment

Rating: questionable

The contract's value of $93.4 million over nearly 9 years for consulting services presents a high cost. Without competitive bidding, it's difficult to benchmark against market rates or similar contracts. The cost-plus fixed fee (CPFF) pricing structure, while common for R&D or uncertain scope, can lead to cost overruns if not managed tightly, potentially offering less value for money compared to fixed-price contracts. The absence of specific performance metrics in the provided data makes a definitive value assessment challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a 'NOT AVAILABLE FOR COMPETITION' basis, indicating a sole-source procurement. This means the Army did not solicit bids from multiple vendors. While sole-source awards can be justified for unique capabilities or urgent needs, they inherently reduce competitive pressure, potentially leading to higher prices and less innovation. The lack of a competitive process here means taxpayers did not benefit from the price discovery that typically occurs when multiple firms vie for a contract.

Taxpayer Impact: Sole-source awards mean taxpayers may be paying a premium due to the absence of competitive pricing. This limits the government's ability to secure the best possible value.

Public Impact

The primary beneficiaries are the Department of the Army, receiving support for the SWORD Program Office. Services likely include program management, technical consulting, and strategic advice to enhance Army operations. The geographic impact is primarily within the Department of the Army's operational sphere, potentially worldwide. Workforce implications include the direct employment of Booz Allen Hamilton personnel and potential indirect impacts on Army staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award limits price discovery and potentially increases costs for taxpayers.
Cost-plus fixed fee contract type can incentivize higher spending if not rigorously managed.
Long contract duration (over 8 years) may indicate a lack of market exploration for more cost-effective solutions.
Broad service category (Other Scientific and Technical Consulting Services) requires careful oversight to ensure focused and efficient delivery.
No indication of small business participation or subcontracting goals.

Positive Signals

Booz Allen Hamilton is a large, established contractor with significant experience in government consulting.
The contract supports a specific program office (SPMO), suggesting a defined need within the Army.
Definitive contract award implies a clear understanding of the scope and terms, though the pricing structure warrants attention.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically consulting. This is a large and competitive market for the federal government, with significant spending allocated annually. The Army's reliance on external expertise for program support is common across defense agencies. Comparable spending benchmarks would typically involve analyzing other large consulting contracts awarded by the Department of Defense for similar program management and technical advisory services.

Small Business Impact

The data indicates this contract did not involve small business set-asides (ss: false, sb: false). This suggests that opportunities for small businesses to participate, either as prime contractors or through subcontracting, were not a primary consideration in this award. For a contract of this magnitude and duration, a lack of small business involvement can limit the infusion of innovative solutions and specialized expertise that small businesses often bring to the federal contracting landscape.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. The Inspector General (IG) for the Department of Defense may also conduct audits or investigations into contract performance and spending, particularly given the significant value and non-competitive nature. Transparency is limited by the sole-source award, but contract performance reports and financial reviews by the agency should provide internal accountability.

Related Government Programs

Department of Defense Consulting Services
Army Program Management Support
Scientific and Technical Consulting Contracts
Cost-Plus Fixed Fee Contracts
Sole-Source Defense Contracts

Risk Flags

Non-competitive award
Cost-plus contract type
Lack of small business participation
High contract value

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $93.4 million to BOOZ ALLEN HAMILTON INC. IGF::OT::IGF SWORD PROGRAM OFFICE (SPMO) SUPPORT

Who is the contractor on this award?

The obligated recipient is BOOZ ALLEN HAMILTON 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 $93.4 million.

What is the period of performance?

Start: 2015-01-01. End: 2023-09-30.

What specific services does the SWORD Program Office Support contract entail, and how are they critical to the Army's mission?

The provided data classifies the contract under 'Other Scientific and Technical Consulting Services' (NAICS 541690). While specific details are not available, such services typically encompass program management, strategic planning, technical analysis, systems engineering support, and advisory roles. For the Army's SWORD Program Office (SPMO), these services are likely critical for the development, acquisition, sustainment, or modernization of specific weapon systems or technologies. The SPMO's function is to ensure these programs meet operational requirements, stay within budget, and adhere to timelines. Booz Allen Hamilton's role would be to provide the expertise and personnel necessary to execute these complex program functions effectively, bridging gaps in organic Army capabilities or providing specialized knowledge.

How does the Cost-Plus Fixed Fee (CPFF) structure potentially impact the overall cost and value delivered compared to other contract types?

The Cost-Plus Fixed Fee (CPFF) contract type allows the contractor (Booz Allen Hamilton) to recover all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure is often used when the scope of work is not precisely defined or involves significant research and development, making fixed-price contracts impractical. However, CPFF contracts carry inherent risks for the government. Since the contractor is reimbursed for costs, there is less incentive to control expenses compared to fixed-price contracts. The 'fixed fee' component, while intended to provide profit stability, can become a disproportionately large portion of the total contract value if costs escalate significantly. Effective oversight, rigorous cost auditing, and clear performance metrics are crucial to mitigate these risks and ensure value for money under a CPFF arrangement.

Given the sole-source nature of this award, what are the potential risks and justifications for the Department of the Army?

The primary risk of a sole-source award is the lack of competition, which can lead to inflated prices, reduced innovation, and a perception of unfairness. Justifications for sole-sourcing typically include situations where only one responsible source can provide the required supply or service (e.g., unique proprietary technology, urgent and compelling needs where competition is impractical, or follow-on work to a competitively awarded contract where only the original contractor can perform). For the Army's SPMO support, the justification might stem from a highly specialized requirement, a need for continuity with existing knowledge held by Booz Allen Hamilton, or a rapidly evolving program where competitive re-solicitation would cause unacceptable delays. Without detailed justification documentation, it's difficult to fully assess the validity of the sole-source decision.

What is Booz Allen Hamilton's track record with the Department of Defense, and does it indicate a history of successful contract performance?

Booz Allen Hamilton is a major incumbent contractor for the Department of Defense (DoD) and other federal agencies, with a long history of providing a wide range of services, including IT, cybersecurity, management consulting, and systems engineering. Their extensive experience suggests a deep understanding of government operations and procurement processes. While specific performance metrics for this particular $93.4 million contract are not detailed here, Booz Allen Hamilton generally has a substantial portfolio of DoD contracts. Reviews of their past performance often highlight their capacity to handle large, complex programs. However, like any large contractor, they may have faced scrutiny or performance issues on specific contracts, underscoring the importance of ongoing oversight and performance management by the Army.

How does the $93.4 million spending on 'Other Scientific and Technical Consulting Services' compare to broader federal spending trends in this category?

Federal spending on 'Other Scientific and Technical Consulting Services' (NAICS 541690) is substantial, reflecting the government's reliance on external expertise across various domains, including defense, research, and technology. The Department of Defense is consistently one of the largest purchasers of these services. A $93.4 million contract over nearly nine years, while significant for a single program, represents a fraction of the total federal outlays in this broad category. Benchmarking requires comparing this contract's value and duration against similar consulting services procured by the DoD or other agencies for comparable program support functions. Trends often show a steady demand for specialized consulting, particularly in areas like advanced technology, cybersecurity, and program management, driven by complex government missions and evolving threats.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Other Scientific and Technical Consulting Services

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W91CRB14R0007

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Booz Allen Hamilton Holding Corporation

Address: 8283 GREENSBORO DR, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $119,043,083

Exercised Options: $119,043,083

Current Obligation: $93,396,890

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline