DoD's $37M Lockheed Martin contract for systems engineering services awarded via full and open competition
Contract Overview
Contract Amount: $37,185,158 ($37.2M)
Contractor: Lockheed Martin Integrated Systems, LLC
Awarding Agency: Department of Defense
Start Date: 2006-08-16
End Date: 2010-09-21
Contract Duration: 1,497 days
Daily Burn Rate: $24.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 14
Pricing Type: TIME AND MATERIALS
Sector: Defense
Official Description: 200611!007187!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0703DB009 !A!N! !Y!0235 ! !20060816!20110129!068514251!805258373!834951691!N!LOCKHEED MARTIN INTEGRATED SYS!1800 ROUTE 34 !WALL !NJ!07719!76460!025!34!WALL (TOWNSHIP OF) !MONMOUTH !NEW JERSEY!+000001576441!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !NOT DISCERNABLE !541330!E! !5!B!M! !A! !99990909!B! ! !A! !A!N!Y!2!014!B! !C!N!Z! ! !N!C!N! ! ! !C!Z!A!A!000!A!C!N! ! ! ! ! ! !0001! !
Place of Performance
Location: WALL TOWNSHIP, MONMOUTH County, NEW JERSEY, 07719, UNITED STATES OF AMERICA
Plain-Language Summary
Department of Defense obligated $37.2 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC for work described as: 200611!007187!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0703DB009 !A!N! !Y!0235 ! !20060816!20110129!068514251!805258373!834951691!N!LOCKHEED MARTIN INTEGRATED SYS!1800 ROUTE 34 !WALL !NJ!07719!76460!025!34!WALL (TOWNSHIP OF) !MONM… Key points: 1. Contract awarded to a large, established defense contractor, indicating a need for specialized, high-level expertise. 2. The contract was competed openly, suggesting a competitive environment that should theoretically drive favorable pricing. 3. Performance period of nearly 5 years suggests a long-term requirement for the services provided. 4. The contract type (Time and Materials) can pose cost control risks if not managed diligently. 5. Services fall under Research and Development, aligning with the agency's focus on technological advancement. 6. The geographic location of the contractor in New Jersey may have implications for local economic impact and workforce.
Value Assessment
Rating: fair
The contract value of $37.2 million over approximately 5 years for systems engineering services is substantial. Benchmarking this against similar contracts is challenging without more specific service details. However, the Time and Materials (T&M) contract type, while flexible, can lead to cost overruns if not closely monitored. The absence of a fixed price or cost-plus-fixed-fee structure suggests a higher degree of risk for the government in terms of cost certainty.
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 offers. The data does not specify the number of bidders, but this procurement method generally fosters a competitive environment. This approach is intended to ensure the government receives the best value by allowing a wide range of potential contractors to compete, which can lead to more innovative solutions and competitive pricing.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the pool of potential offerors, increasing the likelihood of receiving competitive bids and thus potentially lower prices for the services rendered.
Public Impact
The primary beneficiary is the Department of Defense, specifically the Department of the Army, which receives critical systems engineering support. The services delivered are essential for the development, integration, and maintenance of complex defense systems. The geographic impact is primarily centered around the contractor's location in Wall, New Jersey, potentially supporting local jobs and the regional economy. The contract supports a highly skilled workforce in systems engineering and related technical fields.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The Time and Materials (T&M) contract type carries inherent risks of cost escalation if not managed with rigorous oversight and detailed reporting.
- Lack of specific performance metrics or outcome-based evaluations in the provided data makes it difficult to assess the true value and effectiveness of the services.
- The broad category of 'Systems Engineering Services' could encompass a wide range of activities, making it hard to pinpoint specific areas of potential inefficiency without further detail.
Positive Signals
- Awarded under full and open competition, which typically leads to better pricing and a wider selection of qualified vendors.
- The contract duration of nearly five years suggests a stable, long-term need for these critical systems engineering capabilities.
- The contractor, Lockheed Martin, is a major defense industry player with a significant track record in complex systems integration and engineering.
Sector Analysis
This contract falls within the broader defense sector, specifically focusing on systems engineering and technical assistance (SETA) services. The market for SETA is substantial, driven by the government's need for specialized expertise in managing and developing complex defense programs. Companies like Lockheed Martin are key players in this market, often competing for large, multi-year contracts that require deep technical knowledge and program management capabilities. Comparable spending benchmarks would typically be found within the Research and Development (R&D) or professional services categories for defense agencies.
Small Business Impact
The data indicates this contract was not set aside for small businesses (ss=false, sb=false). Lockheed Martin Integrated Systems, LLC is a large prime contractor. While there's no direct information on subcontracting plans for small businesses within this specific contract's summary, large prime contractors are often required to meet small business subcontracting goals on their federal contracts. The absence of a small business set-aside suggests the primary focus was on securing specialized capabilities from a large, experienced provider.
Oversight & Accountability
Oversight for this contract would primarily reside with the contracting agency, the Department of the Army, and potentially the Department of Defense's Inspector General. Accountability measures would be embedded in the contract's terms and conditions, including reporting requirements, performance standards, and payment schedules tied to deliverables. Transparency is facilitated through contract award databases like FPDS, though detailed performance reports are often not publicly available.
Related Government Programs
- Systems Engineering
- Research and Development
- Defense Electronics
- Information Technology Services
- Aerospace and Defense Contracting
Risk Flags
- Cost Overrun Risk (T&M Contract Type)
- Scope Creep Potential
- Lack of Detailed Performance Metrics
Tags
defense, department-of-defense, department-of-the-army, lockheed-martin, systems-engineering, research-and-development, time-and-materials, full-and-open-competition, new-jersey, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $37.2 million to LOCKHEED MARTIN INTEGRATED SYSTEMS, LLC. 200611!007187!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0703DB009 !A!N! !Y!0235 ! !20060816!20110129!068514251!805258373!834951691!N!LOCKHEED MARTIN INTEGRATED SYS!1800 ROUTE 34 !WALL !NJ!07719!76460!025!34!WALL (TOWNSHIP OF) !MONMOUTH !NEW JERSEY!+000001576441!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !NOT DISCERNABLE !541330!E! !5!B!M! !A! !999
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 $37.2 million.
What is the period of performance?
Start: 2006-08-16. End: 2010-09-21.
What specific systems engineering tasks were performed under this contract?
The provided data identifies the contract's purpose as 'SYSTEMS ENGINEERING SERVICES' and the Product Service Code (PSC) as R414, which broadly covers 'Support-Professional: Engineering/Technical.' However, the specific tasks are not detailed. Typically, systems engineering services involve activities such as requirements definition, system design and architecture, integration, verification and validation, technical management, and lifecycle support for complex systems. Given the contractor (Lockheed Martin) and the agency (Department of the Army), these services likely supported major defense platforms or C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance) systems. Without access to the contract statement of work (SOW), a granular breakdown of tasks is not possible.
How does the $37.2 million contract value compare to similar systems engineering contracts awarded by the Department of the Army?
Comparing the $37.2 million value requires context regarding the duration and scope. This contract spanned approximately 5 years (August 2006 to September 2010), averaging around $7.4 million per year. The Department of the Army frequently awards large contracts for systems engineering and technical support. Contracts of this magnitude are common for major defense programs requiring specialized expertise. For instance, similar contracts for support on platforms like aircraft, ground vehicles, or communication systems can range from tens to hundreds of millions of dollars over their lifecycle. The specific nature of the systems supported by Lockheed Martin under this contract would determine if $37.2 million is high, low, or average for its category and duration.
What are the primary risks associated with the Time and Materials (T&M) contract type used for this award?
The primary risk of a Time and Materials (T&M) contract type for the government is cost control. Unlike fixed-price contracts, T&M contracts reimburse the contractor for the actual cost of labor (at specified hourly rates) and materials, plus a fixed fee or profit. This structure provides flexibility, which can be beneficial when the scope of work is uncertain or likely to change. However, it places a greater burden on the government to closely monitor labor hours, material costs, and overall effort to prevent cost overruns. If not managed diligently with strong oversight, the final cost can significantly exceed initial estimates, making it less budget certainty for the agency compared to other contract types.
What is Lockheed Martin's track record with similar government contracts?
Lockheed Martin is one of the largest defense contractors globally and has an extensive track record with the U.S. government, particularly the Department of Defense. They are a major provider of systems integration, engineering, logistics, and technology services across numerous platforms, including aircraft (F-35, F-16), missiles, satellites, and command and control systems. Their history includes numerous large, complex, and long-term contracts similar in nature to systems engineering support. While specific performance details for every contract are not public, Lockheed Martin's sustained position as a prime contractor indicates a generally accepted capability to meet government requirements, though like any large contractor, they have faced scrutiny and challenges on specific programs over the years.
How does the $37.2 million spending compare to the overall R&D spending within the Department of the Army during the contract period?
The contract value of $37.2 million represents a small fraction of the Department of the Army's overall Research and Development (R&D) budget during the period of performance (2006-2010). For context, the Army's R&D budget typically runs into the billions of dollars annually. For example, in FY2007, the Army's R&D budget request was over $10 billion. Therefore, while $37.2 million is a significant sum for a single contract, it is a relatively minor component when viewed against the Army's total investment in R&D activities aimed at developing new technologies and capabilities. This contract likely supported a specific, focused R&D effort within systems engineering.
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: 14
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 3000 LINCOLN DR E, MARLTON, NJ, 08053
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: 2006-08-16
Current End Date: 2010-09-21
Potential End Date: 2010-09-21 00:00:00
Last Modified: 2015-05-12
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