VA Awards $68.4M Task Order for Mail Automation Services to IBM
Contract Overview
Contract Amount: $68,364,914 ($68.4M)
Contractor: International Business Machines Corporation
Awarding Agency: Department of Veterans Affairs
Start Date: 2019-12-13
End Date: 2023-09-30
Contract Duration: 1,387 days
Daily Burn Rate: $49.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 5
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: TASK ORDER #2 AGAINST THE VICCS IDIQ CONTRACT, FOR MAIL AUTOMATION SERVICES (MAS), IN SUPPORT OF THE VBA OFFICE OF BUSINESS AND PROCESS INTEGRATION (OBPI)
Place of Performance
Location: BETHESDA, MONTGOMERY County, MARYLAND, 20817
State: Maryland Government Spending
Plain-Language Summary
Department of Veterans Affairs obligated $68.4 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: TASK ORDER #2 AGAINST THE VICCS IDIQ CONTRACT, FOR MAIL AUTOMATION SERVICES (MAS), IN SUPPORT OF THE VBA OFFICE OF BUSINESS AND PROCESS INTEGRATION (OBPI) Key points: 1. IBM secured a significant contract for mail automation services supporting VA's VBA. 2. The contract falls under the VICCS IDIQ, indicating a pre-established framework. 3. Full and open competition was utilized, suggesting a competitive bidding process. 4. The fixed-price contract type aims to control costs for the $68.4M award. 5. Services include computing infrastructure and data processing, aligning with NAICS 518210.
Value Assessment
Rating: good
The $68.4 million award for mail automation services appears reasonable given the scope and duration. Benchmarking against similar IT service contracts for large federal agencies suggests this pricing is within expected ranges.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, allowing all eligible vendors to bid. This method generally promotes competitive pricing and ensures the government receives the best value.
Taxpayer Impact: The competitive nature of the award is expected to yield fair pricing, benefiting taxpayers by avoiding inflated costs for essential mail automation services.
Public Impact
Veterans Affairs will receive enhanced mail automation, potentially improving efficiency in processing claims and information. The use of IBM's services suggests a reliance on established technology providers for critical government functions. Taxpayers benefit from a competitive bidding process that aims to secure cost-effective solutions for federal operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in if services are highly specialized.
- Reliance on a single vendor for critical mail automation could pose operational risks.
- Scope creep could increase costs beyond the initial award if not managed carefully.
Positive Signals
- Awarded under full and open competition.
- Firm fixed-price contract type helps control costs.
- Supports critical VBA operations for veterans.
- Leverages existing VICCS IDIQ contract.
Sector Analysis
This contract falls within the IT services sector, specifically data processing and hosting. Spending in this area is substantial across federal agencies, with significant investments in automation and infrastructure.
Small Business Impact
The contract was awarded to IBM, a large business. There is no indication of specific set-asides or subcontracting requirements for small businesses in the provided data.
Oversight & Accountability
The task order is issued against an existing IDIQ contract, suggesting prior oversight. The firm fixed-price nature provides cost control, but ongoing performance monitoring by the VA is crucial for accountability.
Related Government Programs
- Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services
- Department of Veterans Affairs Contracting
- Department of Veterans Affairs Programs
Risk Flags
- Full and open competition utilized.
- Firm fixed-price contract.
- Supports critical VA operations.
- Leverages existing IDIQ contract.
- Significant investment in process automation.
Tags
computing-infrastructure-providers-data-, department-of-veterans-affairs, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Veterans Affairs awarded $68.4 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. TASK ORDER #2 AGAINST THE VICCS IDIQ CONTRACT, FOR MAIL AUTOMATION SERVICES (MAS), IN SUPPORT OF THE VBA OFFICE OF BUSINESS AND PROCESS INTEGRATION (OBPI)
Who is the contractor on this award?
The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).
What is the total obligated amount?
The obligated amount is $68.4 million.
What is the period of performance?
Start: 2019-12-13. End: 2023-09-30.
What specific mail automation capabilities are being procured, and how do they align with the VBA's strategic goals for process integration?
The task order focuses on mail automation services (MAS) for the Office of Business and Process Integration (OBPI). While specific capabilities aren't detailed, MAS typically involves digitizing, sorting, routing, and managing incoming and outgoing mail. This likely supports OBPI's goal of streamlining operations, improving data accuracy, and accelerating information flow critical for veteran services.
What are the key performance indicators (KPIs) for this task order, and how will IBM's performance be measured to ensure effectiveness and value?
Specific KPIs are not detailed in the provided data. However, typical metrics for mail automation services include mail processing speed, accuracy rates, reduction in manual handling, and system uptime. The VA's Contracting Officer's Representative (COR) would be responsible for monitoring these metrics against contractual requirements to ensure IBM delivers effective services and provides good value for the $68.4 million investment.
Given the $68.4 million value and 5-year duration, what are the potential long-term risks associated with this contract for the VA?
Potential long-term risks include vendor lock-in, where the VA becomes heavily reliant on IBM's proprietary systems, making future transitions difficult and costly. There's also a risk of technological obsolescence if IBM's solution doesn't keep pace with industry advancements. Furthermore, a single point of failure in mail automation could disrupt critical veteran services if not mitigated by robust contingency plans.
Industry Classification
NAICS: Information › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services
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: 5
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6710 ROCKLEDGE DRIVE, BETHESDA, MD, 20817
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $95,038,743
Exercised Options: $68,364,914
Current Obligation: $68,364,914
Actual Outlays: $50,259,248
Subaward Activity
Number of Subawards: 33
Total Subaward Amount: $8,509,893
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: 36C10E19D0018
IDV Type: IDC
Timeline
Start Date: 2019-12-13
Current End Date: 2023-09-30
Potential End Date: 2023-09-30 00:00:00
Last Modified: 2025-07-08
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