Interior Department's $33M IT support contract awarded to Octo Consulting Group for application development

Contract Overview

Contract Amount: $33,058,067 ($33.1M)

Contractor: Octo Consulting Group LLC

Awarding Agency: Department of the Interior

Start Date: 2017-12-18

End Date: 2022-10-30

Contract Duration: 1,777 days

Daily Burn Rate: $18.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 14

Pricing Type: LABOR HOURS

Sector: IT

Official Description: IGF::OT::IGF APPLICATION DEVELOPMENT SUPPORT SERVICES

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20857

State: Maryland Government Spending

Plain-Language Summary

Department of the Interior obligated $33.1 million to OCTO CONSULTING GROUP LLC for work described as: IGF::OT::IGF APPLICATION DEVELOPMENT SUPPORT SERVICES Key points: 1. Value for money appears fair, with a significant contract duration suggesting sustained need. 2. Competition dynamics indicate a full and open competition, which typically fosters better pricing. 3. Risk indicators are moderate, given the long duration and the nature of IT support services. 4. Performance context is tied to application development and support, a critical function for agency operations. 5. Sector positioning places this contract within the broader IT services market for federal agencies.

Value Assessment

Rating: fair

The contract's total value of approximately $33 million over nearly five years suggests a substantial investment in IT support. Benchmarking against similar IT application development and support contracts within the federal government is necessary for a precise value-for-money assessment. However, the duration implies a consistent need for these services, and the pricing structure (labor hours) allows for flexibility but requires careful management to control costs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition after exclusion of sources, indicating that multiple vendors were likely considered. The 'full and open' aspect suggests a robust competitive process, which generally leads to more favorable pricing for the government. The exclusion of sources clause might imply specific technical requirements or prior performance considerations that narrowed the initial pool, but the overall competition level is positive.

Taxpayer Impact: A full and open competition generally benefits taxpayers by driving down prices through market forces and encouraging a wider range of innovative solutions.

Public Impact

The Department of the Interior benefits from enhanced application development and support, improving internal operations. Essential IT services are delivered, ensuring the functionality of critical agency software and systems. The geographic impact is primarily national, supporting the Department's widespread operations. Workforce implications include the potential for direct employment by the contractor and indirect support for federal IT staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to vendor lock-in if not managed carefully.
Reliance on labor hours can introduce cost escalation risks if not closely monitored.
Scope creep is a potential concern in long-term IT support contracts.

Positive Signals

Full and open competition suggests a competitive environment that should yield reasonable pricing.
The contract's focus on application development addresses core IT needs.
Award to an established IT services firm indicates a level of proven capability.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computer systems design and related services. The federal IT services market is substantial, with agencies across all branches investing heavily in maintaining and upgrading their technological infrastructure. This contract represents a portion of the Department of the Interior's overall IT spending, contributing to its operational efficiency and digital transformation efforts. Comparable spending benchmarks would involve analyzing other large-scale IT support contracts awarded to similar firms by federal agencies.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, the primary impact on the small business ecosystem would be through potential subcontracting opportunities, if Octo Consulting Group engages small businesses for specialized services. Without specific subcontracting plans detailed in the award, it's difficult to assess the direct benefit to the small business sector from this particular contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Department of the Interior. Accountability measures are embedded in the contract terms, performance work statements, and delivery schedules. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract is suspected.

Related Government Programs

IT Application Development Services
Computer Systems Design Services
Federal IT Support Contracts
Department of the Interior IT Spending
Large-Scale IT Services Contracts

Risk Flags

Potential for cost overruns due to labor-hour pricing model.
Risk of scope creep over the contract's extended duration.
Need for strong performance monitoring to ensure service quality.
Dependency on contractor expertise could lead to vendor lock-in.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $33.1 million to OCTO CONSULTING GROUP LLC. IGF::OT::IGF APPLICATION DEVELOPMENT SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is OCTO CONSULTING GROUP LLC.

Which agency awarded this contract?

Awarding agency: Department of the Interior (Departmental Offices).

What is the total obligated amount?

The obligated amount is $33.1 million.

What is the period of performance?

Start: 2017-12-18. End: 2022-10-30.

What is the historical spending pattern for application development support services within the Department of the Interior?

Analyzing historical spending patterns for application development support services within the Department of the Interior reveals a consistent and significant investment in maintaining and enhancing its IT infrastructure. Over the past several fiscal years, the Department has allocated substantial funds towards contracts similar to the one awarded to Octo Consulting Group. This spending is driven by the need to support a wide array of agency functions, from resource management and environmental monitoring to public services and internal administration. Trends often show an increasing reliance on specialized IT support as legacy systems are modernized and new digital initiatives are launched. Factors influencing these patterns include agency priorities, budget allocations, and the evolving technological landscape. Understanding these historical trends provides context for the current contract's value and duration, suggesting a sustained requirement for these critical services.

How does the awarded amount compare to similar IT application development contracts awarded by other federal agencies?

Comparing the $33 million award to Octo Consulting Group with similar IT application development contracts across federal agencies requires analyzing contracts with comparable scope, duration, and service types. Large-scale IT support and development contracts for agencies like the General Services Administration (GSA), Department of Defense (DoD), or Department of Health and Human Services (HHS) can range from tens to hundreds of millions of dollars. The $33 million figure for nearly five years of service appears to be within a moderate range for a department-level IT support contract. Factors influencing variations include the complexity of the systems supported, the specific technical expertise required, and the overall IT modernization goals of the agency. A detailed benchmark would involve examining contracts for 'Computer Systems Design Services' (NAICS 541512) with similar award values and performance periods across different federal entities.

What is Octo Consulting Group's track record with federal IT contracts, particularly in application development?

Octo Consulting Group has a notable track record with federal IT contracts, including significant work in application development and support. As a growing IT services provider, the company has secured numerous awards across various federal agencies, demonstrating its capability to meet government requirements. Their portfolio often includes services related to cloud migration, cybersecurity, data analytics, and custom software development. For application development specifically, their experience likely encompasses the full software development lifecycle, from requirements gathering and design to coding, testing, deployment, and maintenance. Examining their past performance on similar contracts, including client feedback and any performance-related issues, would provide a comprehensive view of their reliability and expertise in delivering complex IT solutions to federal clients.

What are the key performance indicators (KPIs) typically used to measure the success of such IT application development support contracts?

Key performance indicators (KPIs) for IT application development support contracts are crucial for ensuring service quality, efficiency, and alignment with agency goals. Common KPIs include system uptime and availability, response times for issue resolution, bug fix rates, and the successful deployment of new features or updates. For development work, metrics like adherence to project timelines, budget performance, and code quality (e.g., defect density) are vital. User satisfaction surveys and the achievement of specific functional requirements outlined in the Performance Work Statement (PWS) also serve as important indicators. The Department of the Interior would likely establish a set of tailored KPIs within the contract's PWS to monitor Octo Consulting Group's performance and ensure the delivered services meet the agency's operational needs effectively.

What is the potential impact of this contract on the IT modernization efforts within the Department of the Interior?

This contract plays a significant role in the Department of the Interior's IT modernization efforts by providing essential support for its application portfolio. Modernization often involves updating legacy systems, migrating to cloud-based solutions, enhancing cybersecurity, and developing new applications to meet evolving mission requirements. By securing dedicated resources for application development and support, the Department can accelerate these initiatives. The contractor's expertise can help in redesigning outdated applications, integrating new technologies, and ensuring that the IT infrastructure remains agile and responsive to changing needs. Successful execution of this contract can lead to improved operational efficiency, enhanced data security, better user experiences, and the ability to leverage advanced technologies for data analysis and decision-making across the Department's diverse bureaus and programs.

What are the primary risks associated with a long-term, labor-hour based IT support contract like this one?

Long-term, labor-hour based IT support contracts present several inherent risks that require diligent management. A primary concern is cost escalation, as labor-hour contracts can become more expensive if project scopes expand or if contractor hours are not efficiently utilized. This can lead to budget overruns if not closely monitored. Another risk is scope creep, where the project's requirements gradually expand beyond the initial agreement, often increasing costs and timelines. Vendor lock-in is also a potential issue; a long-term relationship can make it difficult and costly to switch providers, potentially reducing leverage for future negotiations. Furthermore, ensuring consistent quality and performance over an extended period requires robust oversight and performance management to prevent degradation of services or a decline in innovation.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: D17PS00345

Offers Received: 14

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Parent Company: Octo Consulting Group LLC

Address: 10780 PARKRIDGE BLVD 4TH FL, RESTON, VA, 20191

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $33,058,067

Exercised Options: $33,058,067

Current Obligation: $33,058,067

Actual Outlays: $19,104,643

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201200121W

IDV Type: GWAC

Timeline