GSA awards Deloitte $304M IT support contract for Defense Manpower Data Center over 5 years

Contract Overview

Contract Amount: $292,701,543 ($292.7M)

Contractor: Deloitte Consulting LLP

Awarding Agency: General Services Administration

Start Date: 2018-08-03

End Date: 2023-10-02

Contract Duration: 1,886 days

Daily Burn Rate: $155.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: TASK ORDER (TO) 47QFCA18F0081 IS HEREBY AWARDED TO DELOITTE CONSULTING, LLP (DELOITTE) TO PROVIDE CONTRACTOR SUPPORT TO THE DEFENSE MANPOWER DATA CENTER (DMDC) WITH ITS ENTERPRISE MANAGEMENT INFORMATION TECHNOLOGY SUPPORT (EMITS) WITHIN ITS SEASIDE, CA OFFICE, MARC CENTER, AND FIELD OFFICE LOCATIONS THROUGHOUT THE UNITED STATES (U.S.).THE PERIOD OF PERFORMANCE FOR THIS TO WILL BE AUGUST 03, 2018 THROUGH AUGUST 02, 2023. THE TOTAL VALUE OF THE TO WILL BE $304,285,012 AND THE TO WILL BE FUNDED IN THE AMOUNT OF $16,569,201 AT AWARD. SEE ATTACHED COPY OF TO 47QFCA18F0081, TO ATTACHMENTS, AND THE OFFICIAL NOTIFICATION OF AWARD.

Place of Performance

Location: ALEXANDRIA, ALEXANDRIA CITY County, VIRGINIA, 22350

State: Virginia Government Spending

Plain-Language Summary

General Services Administration obligated $292.7 million to DELOITTE CONSULTING LLP for work described as: TASK ORDER (TO) 47QFCA18F0081 IS HEREBY AWARDED TO DELOITTE CONSULTING, LLP (DELOITTE) TO PROVIDE CONTRACTOR SUPPORT TO THE DEFENSE MANPOWER DATA CENTER (DMDC) WITH ITS ENTERPRISE MANAGEMENT INFORMATION TECHNOLOGY SUPPORT (EMITS) WITHIN ITS SEASIDE, CA OFFICE, MARC CENTER, AND FI… Key points: 1. Contract provides essential IT support for DMDC's enterprise management. 2. Performance spans multiple locations, indicating broad operational reach. 3. The contract type (Cost Plus Award Fee) allows for performance incentives. 4. A significant portion of the total value was funded at award, suggesting immediate need. 5. The duration of the contract (5 years) implies a long-term requirement for these services. 6. The contract falls under IT services, a critical area for defense operations.

Value Assessment

Rating: good

The total value of $304.3 million over five years for IT support services to the Defense Manpower Data Center appears reasonable given the scope and duration. Benchmarking against similar large-scale IT support contracts for federal agencies suggests this falls within expected ranges for comprehensive enterprise management and IT support. The Cost Plus Award Fee structure allows for flexibility and incentivizes performance, which can lead to better value if managed effectively. However, detailed cost breakdowns and comparisons to specific market rates for similar services would be needed for a more precise value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of 3 bids suggests a competitive environment, which generally benefits the government by driving down prices and encouraging innovation. The specific details of the bidding process and the evaluation criteria would further illuminate how effectively this competition translated into optimal value for the government.

Taxpayer Impact: Full and open competition typically leads to better pricing for taxpayers as it encourages a wider range of vendors to compete, potentially lowering costs through market forces.

Public Impact

The primary beneficiary is the Department of Defense, specifically the Defense Manpower Data Center, which receives crucial IT support. Services delivered include enterprise management and IT support across various locations. Geographic impact is nationwide, covering DMDC's Seaside, CA office, MARC Center, and other field offices. Workforce implications include support for government personnel and potentially the contractor's own IT specialists.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can sometimes lead to higher costs if award criteria are not tightly defined or if performance targets are easily met without significant effort.
The broad scope of IT support across multiple locations could present management and oversight challenges.
Reliance on a single contractor for critical IT infrastructure over a long period can create vendor lock-in.

Positive Signals

Awarded through full and open competition, suggesting a competitive bidding process.
The Cost Plus Award Fee structure incentivizes high performance and quality service delivery.
The contract supports a critical defense function (DMDC), indicating a well-defined and necessary requirement.

Sector Analysis

This contract falls within the Information Technology (IT) services sector, specifically focusing on computer systems design and related services. The IT services market for the federal government is substantial, with significant spending allocated to maintaining and upgrading complex systems. This contract for enterprise IT support aligns with broader government trends towards modernizing IT infrastructure and ensuring robust data management capabilities, particularly within defense agencies. Comparable spending benchmarks for large-scale IT support contracts often run into hundreds of millions of dollars over several years, reflecting the complexity and criticality of these services.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large contract awarded under full and open competition, there may be opportunities for small businesses to participate as subcontractors to Deloitte. However, the primary award does not directly benefit small businesses through a set-aside mechanism. The extent of small business subcontracting will depend on Deloitte's own procurement practices and any specific requirements outlined in the contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the General Services Administration (GSA) and the Defense Manpower Data Center (DMDC) as the end-user agency. The Cost Plus Award Fee (CPAF) structure implies performance metrics and evaluation criteria that require regular oversight to determine award fees. Transparency is generally maintained through contract award notices and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Manpower Data Center (DMDC) Operations
Federal Civilian IT Support Services
Enterprise Resource Planning (ERP) Systems Support
IT Infrastructure Modernization Programs
Cloud Computing Services for Defense

Risk Flags

Potential for cost overruns in CPAF contracts if not managed tightly.
Risk of vendor lock-in due to long-term, single-vendor award.
Ensuring clear and measurable performance metrics for award fees.
Maintaining competitive pressure and innovation over the contract's 5-year duration.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $292.7 million to DELOITTE CONSULTING LLP. TASK ORDER (TO) 47QFCA18F0081 IS HEREBY AWARDED TO DELOITTE CONSULTING, LLP (DELOITTE) TO PROVIDE CONTRACTOR SUPPORT TO THE DEFENSE MANPOWER DATA CENTER (DMDC) WITH ITS ENTERPRISE MANAGEMENT INFORMATION TECHNOLOGY SUPPORT (EMITS) WITHIN ITS SEASIDE, CA OFFICE, MARC CENTER, AND FIELD OFFICE LOCATIONS THROUGHOUT THE UNITED STATES (U.S.).THE PERIOD OF PERFORMANCE FOR THIS TO WILL BE AUGUST 03, 2018 THROUGH AUGUST 02, 2023. THE TOTAL VALUE OF THE TO WILL BE $304,285,012 AND THE TO WILL BE FUNDED IN

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $292.7 million.

What is the period of performance?

Start: 2018-08-03. End: 2023-10-02.

What is Deloitte's track record with similar large-scale IT support contracts for defense agencies?

Deloitte Consulting LLP has a significant history of performing large-scale IT support and systems integration contracts across various federal agencies, including defense. They have been involved in complex projects related to enterprise resource planning (ERP), data management, cybersecurity, and IT modernization. Their experience often includes supporting critical functions similar to those of the Defense Manpower Data Center (DMDC). While specific performance metrics for past contracts are not detailed here, Deloitte's consistent presence in winning major federal IT contracts suggests a generally accepted capability. However, a deeper dive into past performance reviews, contract modifications, and any past performance issues would be necessary for a comprehensive assessment of their track record on this specific type of work.

How does the $304.3 million total contract value compare to other IT support contracts for similar defense data centers?

The $304.3 million total contract value for five years of IT support to the DMDC is substantial and aligns with the scale of major IT service contracts awarded to large federal agencies, particularly within the Department of Defense. Comparable contracts for enterprise IT management, system sustainment, and modernization for entities like the Defense Information Systems Agency (DISA) or other major DoD data centers often fall within this range or even exceed it, depending on the scope of services, number of users, and complexity of systems. For instance, contracts supporting large-scale data analytics, personnel management systems, or core IT infrastructure for hundreds of thousands of users can easily reach hundreds of millions of dollars over similar periods. The value here seems commensurate with supporting a critical defense data center's ongoing operational needs and potential modernization efforts.

What are the primary risks associated with a Cost Plus Award Fee (CPAF) contract of this magnitude?

The primary risks associated with a Cost Plus Award Fee (CPAF) contract of this magnitude ($304.3 million) revolve around cost control and performance definition. For the government, there's a risk that costs could escalate beyond initial projections if the 'cost' portion is not tightly managed, even with award fees tied to performance. Defining clear, measurable, and achievable award fee criteria is crucial; if poorly defined, it can lead to contractors receiving high award fees for meeting minimal expectations or, conversely, disincentivize performance if criteria are perceived as unattainable. For the contractor, the risk lies in not meeting the performance targets required to earn the award fee, thus reducing their overall profit margin. Effective oversight and robust performance metrics are essential to mitigate these risks and ensure value for money.

How effective is the 'full and open competition' strategy likely to be in ensuring competitive pricing for this IT support contract?

The 'full and open competition' strategy is generally the most effective method for ensuring competitive pricing in federal contracting, as it allows all responsible sources to submit offers. In this case, with 3 bids received, it indicates a degree of competition. The effectiveness in ensuring optimal pricing depends on several factors: the clarity and realism of the government's requirements (Statement of Work), the evaluation criteria used, and the specific capabilities and pricing strategies of the bidders. If the requirements were well-defined and the bidders were capable and competitive, this approach should have yielded a fair market price. However, the actual level of price competition can only be fully assessed by examining the bid prices submitted and comparing them against each other and independent cost estimates.

What are the potential long-term implications of awarding a 5-year IT support contract to a single vendor like Deloitte?

Awarding a 5-year IT support contract to a single vendor like Deloitte has several potential long-term implications. Positively, it can foster a deep understanding of the DMDC's specific needs and systems, leading to greater efficiency and continuity of service. It allows for strategic planning and investment by the contractor in specialized knowledge and resources. However, potential downsides include the risk of vendor lock-in, where the government becomes heavily reliant on the incumbent contractor, potentially reducing future competition and bargaining power. There's also a risk of complacency or reduced innovation from the contractor over time if performance incentives aren't sufficiently strong or if oversight weakens. Furthermore, if the contractor's strategic direction or business priorities shift, it could impact their long-term commitment or ability to meet evolving government needs.

How does the funding amount at award ($16.6 million) relate to the total contract value ($304.3 million) and the period of performance?

The initial funding of $16.6 million at award for a 5-year contract totaling $304.3 million represents approximately 5.4% of the total contract value. This initial funding is typical for large, multi-year contracts and is often allocated to cover the initial period of performance (e.g., the first year or a portion thereof) and potentially cover upfront costs or mobilization. The remaining value of the contract is typically subject to future appropriations and continued performance. This phased funding approach allows the government to obligate funds incrementally, providing flexibility and managing budget constraints over the contract's lifespan. It indicates that the full $304.3 million is an estimate of the total potential cost, with actual spending dependent on ongoing needs and performance.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design 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: 3

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $458,574,755

Exercised Options: $439,983,555

Current Obligation: $292,701,543

Actual Outlays: $-35,788

Subaward Activity

Number of Subawards: 27

Total Subaward Amount: $76,255,947

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00Q09BGD0018

IDV Type: GWAC

Timeline