USDA Spends $62.8M on Microsoft Enterprise Solutions via Dell Federal Systems
Contract Overview
Contract Amount: $62,761,542 ($62.8M)
Contractor: Dell Federal Systems L.P
Awarding Agency: Department of Agriculture
Start Date: 2021-10-01
End Date: 2022-09-30
Contract Duration: 364 days
Daily Burn Rate: $172.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: USDA MICROSOFT ENTERPRISE SOLUTIONS
Place of Performance
Location: ROUND ROCK, WILLIAMSON County, TEXAS, 78682
State: Texas Government Spending
Plain-Language Summary
Department of Agriculture obligated $62.8 million to DELL FEDERAL SYSTEMS L.P for work described as: USDA MICROSOFT ENTERPRISE SOLUTIONS Key points: 1. Significant investment in enterprise software solutions. 2. Competition was full and open, suggesting market availability. 3. Risk of vendor lock-in with enterprise solutions. 4. IT services sector with a focus on cloud and software.
Value Assessment
Rating: fair
The contract value of $62.8M for a one-year period appears substantial. Benchmarking against similar enterprise-wide Microsoft solution contracts is needed to assess if the pricing is competitive, especially considering the firm fixed-price nature.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating multiple vendors had the opportunity to bid. This method generally promotes price discovery and competitive pricing.
Taxpayer Impact: Taxpayer funds are utilized for essential IT infrastructure and services, aiming for efficient government operations.
Public Impact
Ensures USDA employees have access to necessary Microsoft software and services. Supports critical financial operations and data management within the agency. Potential for improved productivity and collaboration through enterprise solutions.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in with Microsoft ecosystem.
- Reliance on a single vendor for enterprise-wide solutions.
- Need for ongoing maintenance and upgrade costs.
Positive Signals
- Full and open competition utilized.
- Firm fixed-price contract provides cost certainty.
- Supports agency's core financial functions.
Sector Analysis
This contract falls within the IT services sector, specifically focusing on enterprise software solutions. Spending benchmarks for similar Microsoft enterprise agreements vary widely based on scope and user count, but $62.8M for a year is a significant investment.
Small Business Impact
While Dell Federal Systems is a large business, the contract's full and open competition nature allows for potential subcontracting opportunities for small businesses within the IT services ecosystem.
Oversight & Accountability
The Office of the Chief Financial Officer's involvement suggests a focus on financial management and accountability for this IT expenditure. Standard procurement oversight processes should apply.
Related Government Programs
- Other Computer Related Services
- Department of Agriculture Contracting
- Office of the Chief Financial Officer Programs
Risk Flags
- High dollar value for a single vendor's solutions.
- Potential for vendor lock-in.
- Reliance on Microsoft's product roadmap.
- Need for robust cybersecurity measures for enterprise data.
- Complexity of managing enterprise-wide software licenses.
Tags
other-computer-related-services, department-of-agriculture, tx, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Agriculture awarded $62.8 million to DELL FEDERAL SYSTEMS L.P. USDA MICROSOFT ENTERPRISE SOLUTIONS
Who is the contractor on this award?
The obligated recipient is DELL FEDERAL SYSTEMS L.P.
Which agency awarded this contract?
Awarding agency: Department of Agriculture (Office of the Chief Financial Officer).
What is the total obligated amount?
The obligated amount is $62.8 million.
What is the period of performance?
Start: 2021-10-01. End: 2022-09-30.
What specific Microsoft enterprise solutions are included in this contract, and how do they align with USDA's strategic IT goals?
The contract details are limited, but 'Microsoft Enterprise Solutions' typically encompasses a suite of products like Office 365, Azure services, Windows operating systems, and potentially Dynamics. Alignment with USDA's goals would depend on whether these solutions support modernization efforts, cloud migration strategies, data analytics capabilities, or enhanced cybersecurity measures.
What is the projected total cost of ownership for these Microsoft solutions over a 3-5 year period, considering potential upgrades and support?
The current contract is for one year at $62.8M. A 3-5 year projection would require analyzing potential price increases, the cost of new feature adoption, extended support agreements, and any necessary hardware or integration services. Without this data, estimating total cost of ownership is speculative but likely to exceed the initial annual spend.
How does the agency ensure ongoing cost-effectiveness and prevent scope creep within this large enterprise solution contract?
Effective oversight involves regular performance reviews, strict change control processes for any modifications, and benchmarking against industry standards. The agency should also leverage its purchasing power by negotiating favorable terms for future renewals and exploring alternative solutions periodically to maintain competitive pressure.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Dell Technologies Inc.
Address: 1 DELL WAY, ROUND ROCK, TX, 78682
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $62,761,542
Exercised Options: $62,761,542
Current Obligation: $62,761,542
Actual Outlays: $62,761,542
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS35F0884P
IDV Type: FSS
Timeline
Start Date: 2021-10-01
Current End Date: 2022-09-30
Potential End Date: 2022-09-30 00:00:00
Last Modified: 2025-01-22
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