Treasury's IRS awards $18.8M ServiceNow contract to Intact Technology Inc. for IT services

Contract Overview

Contract Amount: $18,824,393 ($18.8M)

Contractor: Intact Technology Inc

Awarding Agency: Department of the Treasury

Start Date: 2023-02-02

End Date: 2024-12-31

Contract Duration: 698 days

Daily Burn Rate: $27.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SERVICENOW WORKSTREAMS RELEASE 3

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20191

State: Virginia Government Spending

Plain-Language Summary

Department of the Treasury obligated $18.8 million to INTACT TECHNOLOGY INC for work described as: SERVICENOW WORKSTREAMS RELEASE 3 Key points: 1. Value for money appears fair given the fixed-price nature and duration, but detailed cost breakdowns are needed for a definitive assessment. 2. The contract was awarded under full and open competition, suggesting a competitive market for these IT services. 3. Risk indicators are moderate, with a fixed-price contract and a single award, but performance monitoring will be key. 4. This contract supports critical IT infrastructure for the IRS, aligning with broader federal digital transformation efforts. 5. The IT services sector is highly competitive, with numerous vendors capable of delivering ServiceNow solutions. 6. The contract's value is within a typical range for specialized IT support services of this scope.

Value Assessment

Rating: fair

The contract's total value of $18.8 million over approximately two years suggests a moderate annual spend. Benchmarking against similar ServiceNow implementation and support contracts is challenging without more granular data on the specific workstreams. However, the firm-fixed-price structure provides cost certainty for the government. The price appears reasonable in the context of specialized IT services, but a deeper dive into labor rates and overhead would be necessary for a more precise value-for-money assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors were eligible to bid. This suggests a healthy competitive environment for IT services related to ServiceNow. The presence of multiple bidders typically leads to better price discovery and potentially more innovative solutions. The specific number of bids received is not provided, which would offer further insight into the intensity of the competition.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices and encouraging efficiency among contractors, leading to better use of public funds.

Public Impact

The Internal Revenue Service (IRS) is the primary beneficiary, receiving enhanced IT support for its critical systems. Services delivered include support for ServiceNow workstreams, likely involving platform maintenance, upgrades, and development. The geographic impact is primarily within the IRS's operational footprint, supporting its national functions. Workforce implications may include the need for specialized IT personnel within the IRS to manage and integrate the ServiceNow platform, as well as potential employment for Intact Technology Inc.'s staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed cost breakdown makes it difficult to fully assess cost-effectiveness.
Limited information on specific performance metrics and deliverables.
Reliance on a single awardee for a critical IT function.
Potential for scope creep if workstreams are not clearly defined.
Need for robust government oversight to ensure timely and quality delivery.

Positive Signals

Awarded under full and open competition, suggesting a competitive process.
Firm-fixed-price contract provides cost certainty.
Contract duration aligns with project phases, allowing for structured delivery.
ServiceNow is a widely adopted platform, indicating established best practices.
Contractor has experience in IT services, though specific ServiceNow expertise needs verification.

Sector Analysis

The IT services sector is a vast and dynamic market, encompassing software development, cloud computing, cybersecurity, and IT support. Federal IT spending represents a significant portion of this market, driven by the need for modernization and efficiency across agencies. ServiceNow is a leading enterprise cloud platform for digital workflow automation, widely used by government agencies for IT service management, HR, and customer service. This contract fits within the broader category of IT professional services, where specialized skills in platform management and development are in high demand. Comparable spending benchmarks for similar ServiceNow support contracts vary widely based on scope and duration.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false) and there is no indication of specific subcontracting requirements for small businesses (sb=false). Therefore, the direct impact on the small business ecosystem is likely minimal unless Intact Technology Inc. voluntarily engages small businesses as subcontractors. The focus of this award is on a full and open competition, which may favor larger, established IT service providers.

Oversight & Accountability

Oversight for this contract will likely be managed by the contracting officer and the program/technical point of contact within the IRS. The firm-fixed-price nature of the contract shifts some risk to the contractor, but the government must still monitor performance against the Statement of Work. Transparency is facilitated by the contract award notice, but detailed performance reports and audits would provide further insight into accountability. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

IRS IT Modernization Initiatives
Federal Civilian IT Services
Cloud Computing Services
IT Service Management (ITSM) Solutions
Enterprise Resource Planning (ERP) Support

Risk Flags

Potential for vendor lock-in
Need for strong performance monitoring
Limited visibility into detailed cost structure
Dependence on single awardee for critical IT function

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $18.8 million to INTACT TECHNOLOGY INC. SERVICENOW WORKSTREAMS RELEASE 3

Who is the contractor on this award?

The obligated recipient is INTACT TECHNOLOGY INC.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $18.8 million.

What is the period of performance?

Start: 2023-02-02. End: 2024-12-31.

What is the specific scope of 'ServiceNow Workstreams Release 3' and how does it align with the IRS's strategic IT goals?

The provided data does not detail the specific 'ServiceNow Workstreams Release 3'. However, based on typical ServiceNow implementations, this likely refers to a specific phase of development, enhancement, or maintenance for the ServiceNow platform. These workstreams could encompass modules for IT Service Management (ITSM), IT Operations Management (ITOM), HR Service Delivery, or Customer Service Management. For the IRS, such a release would likely align with strategic goals of modernizing its internal IT operations, improving service delivery to employees and potentially taxpayers, and enhancing data management and workflow automation to increase efficiency and reduce operational costs. A detailed review of the Statement of Work (SOW) would be necessary to understand the precise objectives and deliverables of this release and its contribution to the IRS's broader IT modernization efforts.

How does the $18.8 million contract value compare to historical spending on similar ServiceNow support at the IRS or other large federal agencies?

Direct comparison of the $18.8 million contract value to historical spending is difficult without specific historical data for the IRS or comparable agencies. However, the value represents an average annual spend of approximately $9.4 million over the two-year period. This figure is within the expected range for significant IT platform support contracts, especially for enterprise-level solutions like ServiceNow, which require specialized expertise for implementation, customization, and ongoing maintenance. Large federal agencies often invest tens to hundreds of millions of dollars in their core IT platforms over several years. To provide a more precise comparison, one would need to analyze the scope of services (e.g., development vs. maintenance), the number of users supported, and the specific modules implemented at the IRS and benchmark against similar contracts awarded to other agencies or through different contract vehicles.

What are the key performance indicators (KPIs) used to measure the success of Intact Technology Inc.'s performance under this contract?

The provided contract data does not specify the Key Performance Indicators (KPIs) for this contract. However, for IT service contracts, particularly those involving a platform like ServiceNow, typical KPIs often include metrics related to system uptime and availability, response times for issue resolution, adherence to service level agreements (SLAs), successful completion of development tasks within defined timelines, user satisfaction ratings, and adherence to security protocols. The firm-fixed-price nature suggests that the contractor is incentivized to deliver the defined scope efficiently. The IRS's technical points of contact would be responsible for monitoring these KPIs and ensuring that Intact Technology Inc. meets the contractual obligations. A review of the contract's Statement of Work and any associated performance management plans would reveal the specific KPIs.

What is Intact Technology Inc.'s track record with federal contracts, particularly those involving ServiceNow or similar enterprise IT platforms?

Information regarding Intact Technology Inc.'s specific track record with federal contracts, especially concerning ServiceNow, is not detailed in the provided data. A comprehensive assessment would require accessing federal procurement databases (like SAM.gov or FPDS) to review their past performance, contract values, agencies served, and types of services rendered. Companies specializing in platforms like ServiceNow often highlight their certifications, partnerships with the platform vendor, and case studies of successful implementations. Without this specific information, it's difficult to definitively assess their experience level. However, being awarded a contract of this value by the IRS suggests they possess the necessary qualifications and capabilities, or were deemed competitive enough through the full and open bidding process.

Are there any potential risks associated with relying on a single vendor, Intact Technology Inc., for these critical ServiceNow workstreams?

Yes, there are potential risks associated with relying on a single vendor for critical IT workstreams. These include vendor lock-in, where transitioning to another provider could be costly and time-consuming. There's also the risk of reduced competition in future procurements if the incumbent performs adequately, potentially leading to higher prices. Furthermore, the IRS's operational continuity could be jeopardized if the vendor faces financial instability, undergoes significant internal restructuring, or fails to maintain adequate staffing levels with the necessary expertise. Mitigating these risks requires robust contract management, clear performance expectations, contingency planning, and potentially fostering an environment where alternative solutions or vendors can be considered in the future.

Industry Classification

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

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

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

Address: 12700 SUNRISE VALLEY DR STE 410, RESTON, VA, 20191

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $19,612,262

Exercised Options: $18,849,393

Current Obligation: $18,824,393

Actual Outlays: $18,824,393

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS35F0414R

IDV Type: FSS

Timeline