IBM awarded $29.75M contract for cybersecurity support to USAID, focusing on policy, technology, and workforce development

Contract Overview

Contract Amount: $29,750,000 ($29.8M)

Contractor: International Business Machines Corporation

Awarding Agency: Agency for International Development

Start Date: 2023-12-29

End Date: 2025-03-11

Contract Duration: 438 days

Daily Burn Rate: $67.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: THE NEW CYBER SECURITY ACTIVITY WILL SUPPORT HOST GOVERNMENT AND OPERATORS TO DEVELOP AND IMPLEMENT POLICIES, PROCEDURES, AND HARDWARE/SOFTWARE SOLUTIONS, AS WELL AS WORKFORCE DEVELOPMENT, AIMED AT IMPROVING PREVENTION, PROTECTION, PREPAREDNESS, RESP

Plain-Language Summary

Agency for International Development obligated $29.8 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: THE NEW CYBER SECURITY ACTIVITY WILL SUPPORT HOST GOVERNMENT AND OPERATORS TO DEVELOP AND IMPLEMENT POLICIES, PROCEDURES, AND HARDWARE/SOFTWARE SOLUTIONS, AS WELL AS WORKFORCE DEVELOPMENT, AIMED AT IMPROVING PREVENTION, PROTECTION, PREPAREDNESS, RESP Key points: 1. Contract aims to enhance cybersecurity posture through policy, technology, and training. 2. Full and open competition suggests a potentially competitive bidding process. 3. Delivery order under an existing contract indicates a need for agile support. 4. Focus on workforce development highlights a strategic approach to long-term security. 5. The contract duration of 438 days allows for phased implementation of solutions. 6. Custom Computer Programming Services (NAICS 541511) is the primary service category.

Value Assessment

Rating: good

The contract value of $29.75 million for cybersecurity support appears reasonable given the scope of work, which includes policy development, hardware/software solutions, and workforce training. Benchmarking against similar large-scale cybersecurity initiatives, this investment aligns with the government's increasing focus on digital defense. The Time and Materials pricing model, while requiring careful oversight, allows for flexibility in addressing evolving cyber threats. Further analysis would benefit from comparing the specific deliverables and expected outcomes against industry standards for similar government contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The number of bidders is not specified, but the open competition suggests a robust process aimed at securing the best value. This approach typically fosters price discovery and encourages contractors to offer competitive terms. The agency's decision to use full and open competition implies confidence in the market's ability to provide suitable solutions.

Taxpayer Impact: Full and open competition generally benefits taxpayers by promoting a competitive environment that can lead to more cost-effective solutions and better pricing for government services.

Public Impact

The primary beneficiaries are the host government and operators who will receive enhanced cybersecurity capabilities. Services delivered include policy development, implementation of hardware/software solutions, and workforce training. The geographic impact is likely global, supporting USAID's international mission. Workforce development components will benefit cybersecurity professionals through training and skill enhancement.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in Time and Materials contracts if not managed diligently.
Reliance on specific vendor expertise could create future dependencies.
Effectiveness of workforce development hinges on quality of training and adoption by personnel.

Positive Signals

Focus on policy and procedures suggests a sustainable, long-term approach to cybersecurity.
Inclusion of hardware/software solutions indicates a comprehensive strategy.
Workforce development component addresses a critical gap in cybersecurity readiness.

Sector Analysis

The cybersecurity sector is a rapidly growing and critical area for government operations, with significant investment driven by increasing digital threats. This contract falls within the IT services and custom computer programming sub-sector. The market for cybersecurity solutions is highly competitive, with a wide range of providers offering specialized services. Government spending in this area is substantial, reflecting the paramount importance of protecting sensitive data and critical infrastructure. This contract with IBM for USAID aligns with broader government efforts to bolster national and international cybersecurity resilience.

Small Business Impact

The contract data indicates that small business participation (ss: false, sb: false) was not a primary set-aside consideration for this specific award. While the contract itself is not set aside for small businesses, the prime contractor, IBM, may engage small businesses as subcontractors. The extent of subcontracting to small businesses will depend on IBM's procurement strategy and the specific requirements of the cybersecurity solutions and services needed. Further investigation into subcontracting plans would be necessary to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Agency for International Development (USAID) contracting officers and program managers. Accountability measures will be tied to the delivery of defined cybersecurity solutions, policy implementation, and workforce development outcomes as outlined in the contract. Transparency is typically maintained through contract reporting requirements and public contract databases. Inspector General jurisdiction may apply if any concerns regarding fraud, waste, or abuse arise during the contract performance period.

Related Government Programs

USAID Cybersecurity Strategy
Department of State Cybersecurity Initiatives
Global Cybersecurity Assistance Programs
Information Technology Professional Services (ITPS) Contracts

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Effectiveness of workforce development requires ongoing monitoring.
Dependency on prime contractor's expertise.
Scope creep management is critical.

Frequently Asked Questions

What is this federal contract paying for?

Agency for International Development awarded $29.8 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. THE NEW CYBER SECURITY ACTIVITY WILL SUPPORT HOST GOVERNMENT AND OPERATORS TO DEVELOP AND IMPLEMENT POLICIES, PROCEDURES, AND HARDWARE/SOFTWARE SOLUTIONS, AS WELL AS WORKFORCE DEVELOPMENT, AIMED AT IMPROVING PREVENTION, PROTECTION, PREPAREDNESS, RESP

Who is the contractor on this award?

The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.

Which agency awarded this contract?

Awarding agency: Agency for International Development (Agency for International Development).

What is the total obligated amount?

The obligated amount is $29.8 million.

What is the period of performance?

Start: 2023-12-29. End: 2025-03-11.

What is IBM's track record with similar USAID cybersecurity contracts?

IBM has a long history of providing IT and cybersecurity services to various U.S. government agencies, including USAID. While specific details on past USAID cybersecurity contracts with IBM are not provided in this data, IBM's broader experience includes developing and implementing complex security solutions, managing large-scale IT infrastructure, and providing cybersecurity consulting. Their track record generally indicates a capacity to handle significant government contracts. However, a deeper dive into past performance reviews, any past performance issues, and the specific nature of previous USAID engagements would be necessary for a comprehensive assessment of their suitability for this particular activity.

How does the $29.75 million value compare to similar cybersecurity support contracts for international development agencies?

The $29.75 million contract value for cybersecurity support to USAID appears to be within a reasonable range for a multi-faceted program involving policy development, technology implementation, and workforce training over approximately 1.5 years. Similar contracts awarded to large system integrators for international cybersecurity initiatives can range from tens to hundreds of millions of dollars, depending on the scope, duration, and geographic reach. Factors influencing this value include the complexity of the threats addressed, the level of customization required for hardware/software solutions, and the scale of the workforce development program. Without specific benchmarks for comparable USAID-specific cybersecurity activities, it's challenging to provide a precise comparison, but the allocated funds suggest a significant and comprehensive effort.

What are the primary risks associated with this Time and Materials contract type?

Time and Materials (T&M) contracts, like this one, carry inherent risks primarily related to cost control and scope management. The main risk is that costs can escalate beyond initial estimates if the effort required is greater than anticipated or if project scope expands without adequate controls. For taxpayers, this means potential for overspending if not closely monitored. The government must diligently track labor hours and material costs to ensure efficiency and prevent contractor inefficiency from driving up expenses. Effective oversight, clear task definitions, and regular performance reviews are crucial to mitigate these risks and ensure value for money.

How effective is the focus on workforce development likely to be in improving long-term cybersecurity?

The emphasis on workforce development is a critical component for achieving sustainable improvements in cybersecurity. By training personnel within the host government and operators, this contract aims to build internal capacity, reducing long-term reliance on external support and fostering a culture of security. Effective workforce development programs can lead to better threat detection, faster incident response, and more proactive security measures. The success of this component will depend on the quality and relevance of the training provided, the engagement of the participants, and the establishment of clear career paths and retention strategies for cybersecurity professionals within the supported organizations. A well-executed training program can significantly enhance an organization's resilience against evolving cyber threats.

What is the historical spending trend for cybersecurity services by USAID?

Analyzing USAID's historical spending trends for cybersecurity services is crucial for contextualizing this $29.75 million contract. While specific historical data is not provided here, USAID, like many development agencies, has increasingly prioritized cybersecurity due to the growing digital footprint of its operations and the sensitive data it handles. Spending in this area has likely seen an upward trend over the past decade, driven by the proliferation of cyber threats targeting government entities and critical infrastructure globally. Understanding past investments, the types of services procured, and the outcomes achieved would provide valuable insights into whether this current contract represents an increase, a continuation, or a shift in USAID's cybersecurity procurement strategy.

What are the potential implications of this contract on the broader cybersecurity market, particularly for small businesses?

This contract, awarded to a large prime contractor like IBM, has several implications for the broader cybersecurity market. For large enterprises, it represents a significant opportunity to leverage their extensive resources and expertise. For the cybersecurity ecosystem, it underscores the demand for comprehensive solutions that integrate policy, technology, and training. Regarding small businesses, the impact is indirect. While not a direct set-aside, large prime contractors often engage small businesses for specialized services or subcontracting opportunities. The extent to which IBM utilizes small businesses will determine the direct benefit to this segment. However, the overall growth in government cybersecurity spending, driven by contracts like this, can create a more robust market environment where small businesses can find opportunities, either as prime contractors on smaller deals or as subcontractors.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming 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: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 1 NEW ORCHARD RD, ARMONK, NY, 10504

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

Financial Breakdown

Contract Ceiling: $94,999,960

Exercised Options: $52,000,000

Current Obligation: $29,750,000

Actual Outlays: $11,832,627

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS35F110DA

IDV Type: FSS

Timeline