Lockheed Martin awarded $83.6M for Systems Engineering Services, highlighting a significant investment in defense R&D
Contract Overview
Contract Amount: $24,167,296 ($24.2M)
Contractor: Lockheed Martin Integrated Systems, LLC
Awarding Agency: Department of Defense
Start Date: 2003-09-29
End Date: 2011-09-17
Contract Duration: 2,910 days
Daily Burn Rate: $8.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 6
Pricing Type: FIRM FIXED PRICE
Sector: R&D
Official Description: 200312!001047!2100!AB32 !USA COMMUNICATIONS-ELECTRONICS !DAAB0703DB009 !A!N! !N!Y601 !20030929!20031017!836196972!805258373!834951691!N!LOCKHEED MARTIN INTEGRATED SYS!6801 ROCKLEDGE DRIVE !BETHESDA !NJ!20817!24670!003!04!FORT HUACHUCA !COCHISE !ARIZONA !+000000040000!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!M! !A! !99990909!B!F!Y!A! !A!U!J!2!006!G! !Z!N!Z! ! !N!C!N! ! ! !Z!Z!A!A!000!A!B!N! ! ! ! ! ! !0001! !
Place of Performance
Location: WALL TOWNSHIP, MONMOUTH County, NEW JERSEY, 07719, UNITED STATES OF AMERICA
Plain-Language Summary
Department of Defense obligated $24.2 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC for work described as: 200312!001047!2100!AB32 !USA COMMUNICATIONS-ELECTRONICS !DAAB0703DB009 !A!N! !N!Y601 !20030929!20031017!836196972!805258373!834951691!N!LOCKHEED MARTIN INTEGRATED SYS!6801 ROCKLEDGE DRIVE !BETHESDA !NJ!20817!24670!003!04!FORT HUACHUCA !COCHI… Key points: 1. Contract value of $83.6 million for systems engineering services. 2. Awarded to Lockheed Martin Integrated Systems, LLC, a major defense contractor. 3. Contract duration spans from September 2003 to September 2011. 4. Procured under full and open competition, indicating a broad market search. 5. Services fall under Research and Development in Physical, Engineering, and Life Sciences. 6. Performance location is Fort Huachuca, Arizona, a key military installation.
Value Assessment
Rating: good
The contract value of $83.6 million for systems engineering services over an 8-year period appears reasonable given the contractor and the nature of the services. Benchmarking against similar large-scale R&D and systems engineering contracts within the Department of Defense would provide a more precise value-for-money assessment. However, the duration and scope suggest a substantial, complex undertaking.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. The presence of 6 bidders indicates a competitive environment, which typically drives better pricing and innovation. The level of competition is a positive sign for price discovery and ensuring taxpayer value.
Taxpayer Impact: Full and open competition generally leads to more favorable pricing for taxpayers by encouraging a wider range of offers and potentially lower bids.
Public Impact
Benefits the Department of Defense by providing critical systems engineering expertise. Supports the development and enhancement of complex defense systems. Geographic impact is concentrated at Fort Huachuca, Arizona. Implies a need for skilled engineers and technical personnel within the defense sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (8 years) could lead to scope creep or evolving requirements.
- Reliance on a single large contractor for critical systems engineering may pose a risk if performance falters.
Positive Signals
- Awarded through full and open competition, suggesting a robust selection process.
- Contractor, Lockheed Martin, is a well-established entity with extensive experience in defense contracting.
- Services are categorized under R&D, indicating investment in future capabilities.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on systems engineering for defense applications. The market for defense R&D and systems engineering is dominated by large, specialized contractors. Spending in this area is crucial for maintaining technological superiority and national security. Comparable spending benchmarks would involve analyzing other large-scale engineering service contracts awarded by the DoD.
Small Business Impact
The data indicates this contract was not set aside for small businesses and that the prime contractor is a large corporation. There is no explicit information on subcontracting plans for small businesses. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem is unclear, though large prime contracts often involve a network of smaller suppliers.
Oversight & Accountability
Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which ensures compliance with contract terms and performance standards. Accountability measures are inherent in the firm-fixed-price structure, which shifts some risk to the contractor. Transparency is generally maintained through contract award databases, though specific performance details may be sensitive.
Related Government Programs
- Department of Defense Research and Development Contracts
- Systems Engineering Services Contracts
- Information Technology and Engineering Support Services
- Defense Logistics Agency Contracts
Risk Flags
- Long-term contract duration
- Potential for scope creep in R&D
- Reliance on a single large prime contractor
Tags
department-of-defense, research-and-development, systems-engineering-services, lockheed-martin, firm-fixed-price, full-and-open-competition, arizona, defense-contract-management-agency, large-contract, ict-services
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $24.2 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC. 200312!001047!2100!AB32 !USA COMMUNICATIONS-ELECTRONICS !DAAB0703DB009 !A!N! !N!Y601 !20030929!20031017!836196972!805258373!834951691!N!LOCKHEED MARTIN INTEGRATED SYS!6801 ROCKLEDGE DRIVE !BETHESDA !NJ!20817!24670!003!04!FORT HUACHUCA !COCHISE !ARIZONA !+000000040000!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!M! !A! !99990909!B
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $24.2 million.
What is the period of performance?
Start: 2003-09-29. End: 2011-09-17.
What is Lockheed Martin's track record with similar systems engineering contracts for the Department of Defense?
Lockheed Martin Integrated Systems, LLC, as a subsidiary of Lockheed Martin Corporation, has a long and extensive track record of performing complex systems engineering and integration services for the Department of Defense across numerous platforms and programs. They are a prime contractor on many large-scale defense initiatives, including aircraft, missile defense, and C4ISR systems. Their history includes both highly successful project completions and, like many large contractors, occasional challenges related to cost overruns or schedule delays on very complex, long-term projects. Performance on this specific contract, awarded in 2003, would need to be assessed against its stated objectives and delivery timelines, considering the inherent complexities of R&D and systems engineering in the defense sector.
How does the $83.6 million contract value compare to other systems engineering contracts of similar scope and duration?
The $83.6 million contract value for 8 years of systems engineering services represents an average annual value of approximately $10.45 million. This figure appears to be within a reasonable range for large-scale, specialized engineering support required by the Department of Defense. However, a precise comparison requires detailed analysis of the specific technical requirements, the level of complexity, the security clearances involved, and the specific R&D objectives. Contracts for highly specialized R&D, advanced systems integration, or critical national security programs often command higher values due to the unique expertise and resources required. Benchmarking against contracts with similar North American Industry Classification System (NAICS) codes (e.g., 541710 for R&D, 541330 for Engineering Services) and similar agencies would provide a more robust comparison.
What are the primary risks associated with this contract for the government and the contractor?
For the government, primary risks include potential cost overruns if the scope expands beyond initial estimates, schedule delays impacting critical defense capabilities, and performance deficiencies where the delivered systems do not meet requirements. There's also a risk of vendor lock-in due to the specialized nature of the services and the contractor's deep involvement. For the contractor, risks include underestimating the complexity of the systems engineering tasks, failing to meet performance specifications leading to penalties or contract termination, and managing the long-term resource allocation and personnel requirements over an 8-year period. The firm-fixed-price nature of the contract shifts significant cost risk to Lockheed Martin.
How effective is the 'full and open competition' approach in ensuring value for money in defense R&D contracts?
Full and open competition is generally considered the most effective method for ensuring value for money in defense R&D contracts. By allowing all responsible sources to submit bids, it fosters a competitive environment that drives down prices, encourages innovation, and ensures that the government selects the best overall solution. In this case, with 6 bidders, there was a reasonable level of competition. However, the effectiveness can be moderated by the complexity of the R&D requirements, which might limit the number of truly capable bidders, and the potential for incumbent advantage if the contract is a follow-on. Despite these factors, full and open competition remains the gold standard for maximizing taxpayer value and promoting a healthy defense industrial base.
What is the historical spending pattern for systems engineering and R&D services within the Department of Defense?
The Department of Defense has historically been a major spender on systems engineering and Research and Development (R&D) services. These expenditures are critical for maintaining technological superiority and addressing evolving national security threats. Spending in these areas typically fluctuates based on geopolitical conditions, technological advancements, and specific program requirements. Large defense contractors like Lockheed Martin consistently receive significant portions of this spending due to their capabilities in handling complex, large-scale projects. Analyzing historical spending data reveals a consistent, substantial investment in these areas, often comprising billions of dollars annually across various defense agencies and branches.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences
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: 6
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 1800 RT. 34, BLDG. 4, STE 405, BELMAR, NJ, 07719
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: DAAB0703DB009
IDV Type: IDC
Timeline
Start Date: 2003-09-29
Current End Date: 2011-09-17
Potential End Date: 2011-09-17 00:00:00
Last Modified: 2015-05-04
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