Lockheed Martin awarded $80.5M for systems engineering services, highlighting a significant contract in defense electronics
Contract Overview
Contract Amount: $61,683,816 ($61.7M)
Contractor: Lockheed Martin Integrated Systems, LLC
Awarding Agency: Department of Defense
Start Date: 1999-09-23
End Date: 2004-12-31
Contract Duration: 1,926 days
Daily Burn Rate: $32.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 6
Pricing Type: TIME AND MATERIALS
Sector: Defense
Official Description: 199912!2100!4544!AB07 !USA COMM-ELECTRONICS COMMAND !DAAB0798DH503 !A!*!0035 !19990923!20010728!805258373!805258373!834951691!N!1H2F6!LOCKHEED MARTIN SERVICES, INC.!2339 ROUTE 70 W !CHERRY HILL !NJ!08002!24480!025!34!FORT MONMOUTH !MONMOUTH !NEW JERSEY!0001!+000001799220!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !A7 !ELECTRONICS AND COMMUNICATION !1000!NOT DISCERNABLE OR CLASSIFIED !8711!5!B!M!*!B!A!*!A !N!Y!2!006!B!* !C!N!Z!* !* !N!C!*!C!C!A!A!A!*!* !*!N!A!C!N!*!*!*!*!*!
Place of Performance
Location: WALL TOWNSHIP, MONMOUTH County, NEW JERSEY, 07719
Plain-Language Summary
Department of Defense obligated $61.7 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC for work described as: 199912!2100!4544!AB07 !USA COMM-ELECTRONICS COMMAND !DAAB0798DH503 !A!*!0035 !19990923!20010728!805258373!805258373!834951691!N!1H2F6!LOCKHEED MARTIN SERVICES, INC.!2339 ROUTE 70 W !CHERRY HILL !NJ!08002!24480!025!34!FORT MONMOUTH !MONMOU… Key points: 1. Contract value of $80.5 million indicates substantial investment in specialized engineering support. 2. Full and open competition suggests a robust bidding process, potentially leading to better pricing. 3. The contract's duration of over 5 years points to a long-term need for these services. 4. Systems engineering services are critical for complex defense systems integration and maintenance. 5. Awarded to Lockheed Martin, a major defense contractor with extensive experience in the sector. 6. The contract falls under the 'Electronics and Communication' category, a key area for military modernization.
Value Assessment
Rating: good
The contract value of $80.5 million for systems engineering services appears reasonable given the duration and the nature of defense contracting. Benchmarking against similar large-scale engineering support contracts for the Department of Defense would provide further context. The specific services rendered under this 'Time and Materials' contract type will influence the ultimate value assessment. Without detailed breakdowns of labor hours and rates, a precise value-for-money judgment is challenging, but the competitive award suggests a degree of market validation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple bidders were likely considered. The presence of a competitive process is generally favorable for price discovery and ensuring that the government receives competitive pricing. The number of bidders, while not explicitly stated in the provided data, is a key factor in assessing the strength of the competition. A higher number of qualified bidders typically leads to more aggressive pricing.
Taxpayer Impact: Taxpayers benefit from a competitive bidding process as it is designed to drive down costs and ensure the government is not overpaying for essential services.
Public Impact
The primary beneficiaries are the Department of the Army and potentially other branches of the Department of Defense requiring advanced systems engineering. Services delivered include crucial systems engineering support, likely encompassing design, integration, testing, and lifecycle management of complex electronic and communication systems. The geographic impact is centered around Fort Monmouth, New Jersey, where the contract was administered, and potentially extends to operational units utilizing the supported systems. Workforce implications include employment opportunities for engineers, technicians, and support staff within Lockheed Martin and its potential subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns inherent in Time and Materials contracts if not closely managed.
- Dependence on a single large contractor for critical systems engineering functions.
- Scope creep could increase the final cost beyond initial projections without adequate oversight.
Positive Signals
- Award to a reputable contractor with a proven track record in defense systems.
- Full and open competition suggests a structured procurement process.
- Long contract duration implies a stable and predictable need for these services.
Sector Analysis
This contract falls within the Defense sector, specifically focusing on IT and Electronics & Communication systems. The market for defense systems engineering is characterized by high barriers to entry, specialized expertise, and significant government investment. Companies like Lockheed Martin are key players in this domain, providing essential support for the development and maintenance of advanced military technologies. Comparable spending benchmarks would involve analyzing other large-scale engineering support contracts awarded by the DoD for similar technological areas.
Small Business Impact
The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). Lockheed Martin, as a large prime contractor, may engage small businesses as subcontractors. However, the primary awardee is a major corporation, suggesting that the direct impact on the small business ecosystem through this specific prime contract is likely limited unless significant subcontracting opportunities are created.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and administrative contracting officer within the Department of the Army or the relevant DoD agency. Accountability measures would be defined in the contract terms, including performance standards and reporting requirements. Transparency is generally limited for defense contracts due to security considerations, but contract awards and basic details are often publicly available through federal procurement databases.
Related Government Programs
- Department of Defense IT Services
- Defense Electronics Procurement
- Systems Engineering and Technical Assistance (SETA)
- Command, Control, Communications, Computers, and Intelligence (C4I) Systems
Risk Flags
- Contract Type Risk (Time and Materials)
- Potential for Cost Overruns
- Dependence on Single Contractor
- Scope Creep Potential
Tags
defense, department-of-defense, department-of-the-army, systems-engineering, lockheed-martin, electronics-and-communication, time-and-materials, full-and-open-competition, new-jersey, it-services, defense-contracting, major-contractor
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $61.7 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC. 199912!2100!4544!AB07 !USA COMM-ELECTRONICS COMMAND !DAAB0798DH503 !A!*!0035 !19990923!20010728!805258373!805258373!834951691!N!1H2F6!LOCKHEED MARTIN SERVICES, INC.!2339 ROUTE 70 W !CHERRY HILL !NJ!08002!24480!025!34!FORT MONMOUTH !MONMOUTH !NEW JERSEY!0001!+000001799220!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !A7 !ELECTRONICS AND COMMUNICATION !1000!NOT DISCERNABLE OR CLASSIFIED !8711!5!B!M!*!B!A!*!A !N!Y!2!0
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 (Department of the Army).
What is the total obligated amount?
The obligated amount is $61.7 million.
What is the period of performance?
Start: 1999-09-23. End: 2004-12-31.
What is the historical spending pattern for systems engineering services by the Department of the Army?
Historical spending on systems engineering services by the Department of the Army has been substantial and consistently growing, reflecting the increasing complexity of military platforms and the need for integrated technological solutions. Over the past decade, the Army has allocated billions annually to various forms of engineering support, including systems engineering, research and development, and technical assistance. This spending is driven by modernization efforts, upgrades to existing systems, and the development of new capabilities in areas such as cyber warfare, artificial intelligence, and advanced communications. Contracts like the one awarded to Lockheed Martin for $80.5 million are indicative of the significant investment required to maintain technological superiority. Analyzing trends in contract types (e.g., cost-plus, fixed-price, time and materials) and the distribution of funds across different defense contractors can provide further insight into the Army's strategic priorities and its approach to acquiring critical engineering expertise.
How does the awarded amount compare to similar systems engineering contracts in the defense sector?
The $80.5 million award to Lockheed Martin for systems engineering services is a significant but not extraordinary amount within the context of large defense contracts. Major defense contractors frequently receive awards in the tens to hundreds of millions of dollars for complex engineering support, especially for programs with multi-year durations. For instance, contracts for developing or sustaining major weapon systems, aircraft, or communication networks often exceed this figure. The 'Time and Materials' pricing structure suggests that the final cost could fluctuate based on actual labor hours and material costs incurred. To provide a precise comparison, one would need to benchmark this against contracts for similar services (e.g., integration, testing, lifecycle support) awarded by the Department of Defense or other military branches over a comparable timeframe, considering factors like contract duration, scope of work, and the specific technologies involved.
What are the key performance indicators (KPIs) typically used to evaluate the success of such systems engineering contracts?
Key performance indicators (KPIs) for systems engineering contracts typically focus on technical performance, schedule adherence, cost control, and overall program success. For this Lockheed Martin contract, KPIs might include the successful integration of new system components, the timely completion of design reviews and testing phases, the reduction of system defects or failures, and adherence to specified performance parameters (e.g., reliability, maintainability, security). Cost control KPIs would involve managing labor hours and material expenses within projected budgets, especially given the Time and Materials contract type. Schedule adherence is critical, ensuring that engineering milestones are met to keep larger defense programs on track. Ultimately, the contractor's ability to deliver a system that meets or exceeds the government's requirements and contributes to the overall mission effectiveness of the supported platform would be the most crucial measure of success.
What is Lockheed Martin's track record with similar government contracts?
Lockheed Martin has an extensive and well-documented track record with government contracts, particularly within the Department of Defense. As one of the largest defense contractors globally, the company has been awarded numerous large-scale contracts across various domains, including aerospace, defense systems, IT services, and intelligence. Their history includes managing complex engineering, development, and sustainment programs for major platforms like the F-35 fighter jet, Aegis Combat System, and various satellite and missile systems. While specific performance metrics for every contract are not always public, Lockheed Martin is generally recognized for its technical capabilities and its ability to execute large, complex projects. However, like any major contractor, they have also faced scrutiny and challenges on specific programs related to cost, schedule, or performance, which are typical in the high-stakes environment of defense contracting.
What are the potential risks associated with a 'Time and Materials' contract for systems engineering?
Time and Materials (T&M) contracts, like the one awarded to Lockheed Martin, carry inherent risks, primarily related to cost control and potential overruns. Unlike fixed-price contracts, T&M agreements reimburse the contractor for the actual cost of labor (at specified hourly rates) and materials, plus a fee or profit. This structure can lead to uncertainty in the final contract cost, as the total expenditure depends on the actual effort expended and the materials used. For the government, the risk is that the contractor may not be as incentivized to control costs or optimize efficiency as they would be under a fixed-price arrangement. Effective management and oversight by the government are crucial to mitigate these risks, including closely monitoring labor hours, scrutinizing material costs, and ensuring that the work performed is necessary and efficient. Without robust oversight, T&M contracts can become more expensive than initially anticipated.
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 6
Pricing Type: TIME AND MATERIALS (Y)
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 1800 RT. 34, BLDG. 4, STE 405, BELMAR, NJ, 07719
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: DAAB0798DH503
IDV Type: IDC
Timeline
Start Date: 1999-09-23
Current End Date: 2004-12-31
Potential End Date: 2004-12-31 00:00:00
Last Modified: 2017-11-04
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