USCG IT Modernization Contract Awarded to IBM for $62.8M for Computer Systems Design Services

Contract Overview

Contract Amount: $62,866,468 ($62.9M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Homeland Security

Start Date: 2021-09-27

End Date: 2023-03-26

Contract Duration: 545 days

Daily Burn Rate: $115.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: THIS REQUIREMENT IS TO COMPLETE THE USCG IMPLEMENTATION, CUTOVER, OCM AND TRAINING ACTIVITIES REQUIRED TO ENSURE THE UNITED STATES COAST GUARD (USCG) MEETS THE GO LIVE ON 11/1/2021 WITH O&M HYPERCARE SUPPORT FROM THAT DATE FOR 3 MONTHS AND TO OBT

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20024

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $62.9 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: THIS REQUIREMENT IS TO COMPLETE THE USCG IMPLEMENTATION, CUTOVER, OCM AND TRAINING ACTIVITIES REQUIRED TO ENSURE THE UNITED STATES COAST GUARD (USCG) MEETS THE GO LIVE ON 11/1/2021 WITH O&M HYPERCARE SUPPORT FROM THAT DATE FOR 3 MONTHS AND TO OBT Key points: 1. The contract focuses on implementation, cutover, and training for a USCG IT system. 2. IBM, a major player, secured this delivery order. 3. The primary risk lies in potential delays or cost overruns during the critical go-live phase. 4. This falls under IT services, specifically computer systems design.

Value Assessment

Rating: fair

The contract is a Time and Materials type, which can lead to cost uncertainty if not managed closely. The benchmark for similar IT implementation contracts varies widely, making a direct comparison difficult without more detailed scope information.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process. However, this specific award is a delivery order, implying it might be part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract, which could limit the scope of competition for this particular order.

Taxpayer Impact: The use of Time and Materials pricing for a critical implementation phase raises concerns about potential cost escalation, impacting taxpayer funds if not rigorously monitored.

Public Impact

Ensures the USCG meets its critical IT system go-live date. Provides essential hypercare support post-launch for a smooth transition. Impacts the operational efficiency and modernization of a key federal agency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials pricing can lead to cost overruns.
Potential for scope creep impacting budget and timeline.
Dependence on a single vendor for critical implementation.

Positive Signals

Awarded under full and open competition.
Includes post-implementation hypercare support.
Addresses a critical IT modernization need for the USCG.

Sector Analysis

This contract falls within the IT services sector, specifically computer systems design. Spending in this area is substantial across government, with benchmarks heavily dependent on project complexity, duration, and specific technologies involved. The $62.8M value is significant for a single delivery order.

Small Business Impact

The data indicates the prime contractor is IBM, a large business. There is no explicit mention of small business participation in this specific delivery order, suggesting limited direct involvement for small businesses in this particular contract.

Oversight & Accountability

Oversight will be crucial to manage the Time and Materials aspect of the contract, ensuring efficient use of funds and adherence to the project timeline. The Department of Homeland Security's Office of Procurement Operations is responsible for this award.

Related Government Programs

Computer Systems Design Services
Department of Homeland Security Contracting
Office of Procurement Operations Programs

Risk Flags

Time and Materials pricing.
Potential for schedule delays impacting go-live.
Scope creep risks.
Dependence on vendor for critical IT functions.
Lack of explicit small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $62.9 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. THIS REQUIREMENT IS TO COMPLETE THE USCG IMPLEMENTATION, CUTOVER, OCM AND TRAINING ACTIVITIES REQUIRED TO ENSURE THE UNITED STATES COAST GUARD (USCG) MEETS THE GO LIVE ON 11/1/2021 WITH O&M HYPERCARE SUPPORT FROM THAT DATE FOR 3 MONTHS AND TO OBT

Who is the contractor on this award?

The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Office of Procurement Operations).

What is the total obligated amount?

The obligated amount is $62.9 million.

What is the period of performance?

Start: 2021-09-27. End: 2023-03-26.

What specific metrics will be used to measure the success of the implementation, cutover, and training activities?

Success metrics should focus on key performance indicators (KPIs) related to system uptime post-go-live, user adoption rates for the new system, successful data migration completion, and the reduction in post-launch support tickets. Timely completion of all phases within the defined schedule and budget will also be critical indicators of success.

How will the government mitigate the risks associated with Time and Materials pricing to prevent cost overruns?

Mitigation strategies include establishing clear labor categories with pre-defined rates, setting firm not-to-exceed (NTE) limits for each task order, implementing robust project management oversight with regular progress reviews, and defining specific deliverables and milestones that trigger payments. Continuous monitoring of hours and costs against the baseline will be essential.

What is the long-term strategy for IT system maintenance and future enhancements beyond the initial hypercare period?

The long-term strategy should outline plans for ongoing operations and maintenance (O&M) funding, potential follow-on contracts for system upgrades or new feature development, and knowledge transfer to internal USCG IT staff. This ensures sustainability and adaptability of the IT system beyond the initial implementation and support phase.

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

Solicitation ID: 70RDAD21Q00000228

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

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: $64,071,526

Exercised Options: $62,866,468

Current Obligation: $62,866,468

Actual Outlays: $20,745,418

Subaward Activity

Number of Subawards: 136

Total Subaward Amount: $102,220,284

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 47QTCK18D0014

IDV Type: GWAC

Timeline