Leidos awarded $79M contract for NORAD/NORTHCOM IT network support, highlighting sustained demand for critical defense infrastructure
Contract Overview
Contract Amount: $79,063,416 ($79.1M)
Contractor: Leidos, Inc.
Awarding Agency: General Services Administration
Start Date: 2019-11-26
End Date: 2024-11-25
Contract Duration: 1,826 days
Daily Burn Rate: $43.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 7
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: NORAD/NORTHCOM IT NETWORK OPERATIONS AND MAINTENANCE SUPPORT
Place of Performance
Location: HENDERSON, CLARK County, NEVADA, 89014
State: Nevada Government Spending
Plain-Language Summary
General Services Administration obligated $79.1 million to LEIDOS, INC. for work described as: NORAD/NORTHCOM IT NETWORK OPERATIONS AND MAINTENANCE SUPPORT Key points: 1. Contract value indicates significant investment in maintaining essential IT infrastructure for North American defense. 2. The firm-fixed-price structure aims to control costs and provide predictable spending for the government. 3. A full and open competition suggests a robust market for these specialized IT services. 4. The contract duration of five years points to a long-term need for these support services. 5. The award to a single contractor, Leidos, Inc., suggests a focus on established expertise in this niche. 6. The IT network operations and maintenance services are critical for the operational readiness of NORAD/NORTHCOM.
Value Assessment
Rating: good
The contract value of approximately $79 million over five years for IT network operations and maintenance appears reasonable given the critical nature of NORAD/NORTHCOM's mission. Benchmarking against similar large-scale IT support contracts for defense agencies suggests that this pricing is within expected ranges. The firm-fixed-price (FFP) contract type is generally favorable for the government in controlling costs for well-defined services, assuming the scope is accurately managed. The award was made after a full and open competition, which typically drives competitive pricing.
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 seven bids suggests a healthy level of competition for this significant IT support requirement. A competitive process like this is designed to ensure the government receives the best value by allowing various companies to propose their solutions and pricing, leading to potentially lower costs and higher quality services.
Taxpayer Impact: Taxpayers benefit from a competitive process that is expected to yield cost savings and ensure the government secures high-quality IT support services for national defense at a fair price.
Public Impact
The primary beneficiaries are the U.S. and Canadian forces operating under NORAD and U.S. Northern Command, who rely on secure and stable IT networks for command and control. The services delivered include essential IT network operations, maintenance, and support, ensuring the continuous functioning of critical communication and data systems. The geographic impact is national, supporting the continental defense mission from various NORAD/NORTHCOM facilities. Workforce implications include the potential for skilled IT professionals employed by Leidos, Inc. and potentially its subcontractors, to support this vital defense function.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in due to the long-term nature of the contract and specialized knowledge required.
- Reliance on a single prime contractor for critical IT infrastructure could pose risks if performance issues arise.
- The complexity of modern defense IT networks may present unforeseen challenges and cost overruns despite the FFP structure.
Positive Signals
- Awarded through full and open competition, indicating a competitive market and potential for best value.
- Firm-fixed-price contract type provides cost certainty for the government over the contract period.
- The contractor, Leidos, Inc., is a well-established entity with significant experience in government IT services.
- The contract duration suggests a stable and predictable operational environment for NORAD/NORTHCOM's IT needs.
Sector Analysis
This contract falls within the broader IT services sector, specifically focusing on computer systems design and related services. The market for defense IT support is substantial, driven by the increasing reliance on technology for national security operations. Companies like Leidos, Inc. are key players in this space, offering specialized expertise in managing complex networks and systems for government clients. Comparable spending benchmarks in this area often involve multi-year contracts for network infrastructure, cybersecurity, and IT operations, reflecting the high stakes and continuous evolution of defense technology.
Small Business Impact
This contract does not appear to have a specific small business set-aside component, as indicated by the 'sb' field being false. While the prime contractor, Leidos, Inc., is a large business, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting will depend on Leidos's subcontracting plan and the specific requirements of the IT network operations and maintenance. Analysis of subcontracting reports would be necessary to fully assess the impact on the small business ecosystem.
Oversight & Accountability
Oversight for this contract is likely managed by the General Services Administration (GSA) Federal Acquisition Service, which awarded the contract, and the end-user agency, NORAD/NORTHCOM. Accountability measures are embedded within the firm-fixed-price contract terms, performance work statements, and delivery schedules. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.
Related Government Programs
- NORAD/NORTHCOM Command and Control Systems
- Defense Information Systems Network (DISN)
- DoD Enterprise IT Services
- Federal Civilian IT Modernization Programs
- Cloud Computing Services for Defense
Risk Flags
- Potential for vendor lock-in
- Reliance on single prime contractor for critical systems
- Complexity of defense IT infrastructure
- Risk of technology obsolescence
- Need for continuous performance monitoring
Tags
it-services, network-operations, norad, northcom, defense, general-services-administration, leidos-inc, firm-fixed-price, full-and-open-competition, delivery-order, nevada, computer-systems-design
Frequently Asked Questions
What is this federal contract paying for?
General Services Administration awarded $79.1 million to LEIDOS, INC.. NORAD/NORTHCOM IT NETWORK OPERATIONS AND MAINTENANCE SUPPORT
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: General Services Administration (Federal Acquisition Service).
What is the total obligated amount?
The obligated amount is $79.1 million.
What is the period of performance?
Start: 2019-11-26. End: 2024-11-25.
What is Leidos, Inc.'s track record with similar large-scale IT support contracts for defense agencies?
Leidos, Inc. has a substantial track record of performing large-scale IT support and systems integration contracts for various U.S. federal agencies, including significant work within the Department of Defense. They are known for managing complex IT infrastructures, network operations, cybersecurity, and enterprise IT services. Their experience often includes supporting critical command and control systems, similar to those required by NORAD/NORTHCOM. Past performance evaluations and contract awards databases would provide more granular detail on their specific successes and challenges in delivering services comparable to this contract, including their ability to meet performance metrics and manage budgets effectively.
How does the $79 million contract value compare to historical IT spending for NORAD/NORTHCOM network support?
To accurately compare the $79 million contract value to historical spending, one would need access to detailed historical contract data for NORAD/NORTHCOM's IT network operations and maintenance. However, given the five-year duration and the critical nature of the services, this annual average of approximately $15.8 million appears consistent with the ongoing need for robust IT infrastructure in defense organizations. Historical data would reveal if this represents an increase, decrease, or stable level of investment compared to previous support contracts, potentially influenced by technological upgrades, changes in threat landscapes, or shifts in IT service delivery models.
What are the primary risks associated with this firm-fixed-price contract for IT network operations?
The primary risks associated with this firm-fixed-price (FFP) contract for IT network operations include potential scope creep if requirements are not clearly defined and managed, leading to contractor requests for additional funding or change orders. There's also a risk that the contractor might cut corners on service quality to maintain profitability if the fixed price proves too low for the actual effort required. Furthermore, unforeseen technical challenges or the rapid obsolescence of technology could necessitate contract modifications, potentially negating some of the cost certainty benefits of the FFP structure. Effective government oversight and robust contract management are crucial to mitigate these risks.
How effective is the full and open competition process in ensuring value for taxpayer money in this context?
The full and open competition process is generally considered highly effective in ensuring value for taxpayer money, especially for complex IT services like those required by NORAD/NORTHCOM. By allowing all responsible sources to submit bids, it fosters a competitive environment that drives down prices and encourages innovation. The presence of seven bidders in this case suggests a robust market response, increasing the likelihood that the government secured competitive pricing and a technically superior solution. This process helps prevent sole-source awards, which can often lead to higher costs due to a lack of market pressure, thereby maximizing the return on taxpayer investment.
What are the potential implications of this contract on the IT services market for defense contractors?
This contract award to Leidos, Inc. signifies a continued strong demand for comprehensive IT network operations and maintenance services within the defense sector. For other large IT service providers, it highlights the competitive landscape and the importance of demonstrating deep expertise in supporting critical government missions. The full and open competition suggests that companies with proven capabilities in areas like network infrastructure management, cybersecurity, and systems integration are well-positioned to compete for similar future contracts. It also underscores the trend of agencies consolidating IT support functions under larger, multi-year contracts to achieve economies of scale and streamline service delivery.
Are there specific performance metrics or KPIs tied to this contract that indicate program effectiveness?
While the specific performance metrics (Key Performance Indicators - KPIs) are not detailed in the provided data, contracts of this nature typically include stringent performance standards outlined in the Performance Work Statement (PWS). These metrics often relate to network availability (uptime), response times for issue resolution, system security compliance, and successful implementation of upgrades or patches. The firm-fixed-price structure incentivizes the contractor to meet these KPIs to avoid penalties or ensure full payment. Government contracting officers and technical representatives monitor these metrics closely throughout the contract's duration to assess program effectiveness and contractor performance.
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
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 7
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1750 PRESIDENTS ST FL 4, RESTON, VA, 20190
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $94,396,155
Exercised Options: $94,186,759
Current Obligation: $79,063,416
Actual Outlays: $-39,591
Subaward Activity
Number of Subawards: 116
Total Subaward Amount: $24,677,089
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: 47QTCK18D0008
IDV Type: GWAC
Timeline
Start Date: 2019-11-26
Current End Date: 2024-11-25
Potential End Date: 2025-05-25 00:00:00
Last Modified: 2025-08-28
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