DOT's FAA awarded $10.8M IT service management contract to The Centech Group Inc. for training and support
Contract Overview
Contract Amount: $10,782,915 ($10.8M)
Contractor: THE Centech Group Inc.
Awarding Agency: Department of Transportation
Start Date: 2006-09-25
End Date: 2007-09-21
Contract Duration: 361 days
Daily Burn Rate: $29.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: IT SERVICE MANAGEMENT TOOL SERVICES (ON A T&M BASIS) FOR TASKS 1 THROUGH 7 OF THE SOW PLUS TRAINING.
Place of Performance
Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22203
State: Virginia Government Spending
Plain-Language Summary
Department of Transportation obligated $10.8 million to THE CENTECH GROUP INC. for work described as: IT SERVICE MANAGEMENT TOOL SERVICES (ON A T&M BASIS) FOR TASKS 1 THROUGH 7 OF THE SOW PLUS TRAINING. Key points: 1. Contract awarded on a Time & Materials basis, which can pose cost control challenges. 2. The contract was fully and openly competed, suggesting a competitive pricing environment. 3. A relatively short duration of 361 days may limit long-term performance assessment. 4. The North American Industry Classification System (NAICS) code 541519 indicates a broad range of IT services. 5. The contract's value is moderate within the context of IT service contracts. 6. No small business set-aside was utilized for this procurement.
Value Assessment
Rating: fair
The contract's value of approximately $10.8 million for IT service management over roughly one year appears within a reasonable range for such services. However, the Time & Materials (T&M) pricing structure introduces inherent risk for cost overruns compared to fixed-price contracts. Benchmarking against similar IT service management contracts would provide a clearer picture of value for money, especially considering the specific tasks outlined in the Statement of Work (SOW). Without more granular data on the specific services and labor categories, a definitive value assessment is challenging.
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 offers. The presence of 3 bidders suggests a moderate level of competition for this specific IT service requirement. While competition is generally beneficial for price discovery, the exact impact on the final price depends on the nature of the services and the specific capabilities of the bidders.
Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages competitive pricing and potentially leads to better value. The fact that three bids were received suggests that the government received multiple options, which can help ensure a fair market price.
Public Impact
The Federal Aviation Administration (FAA) benefits from enhanced IT service management capabilities. The contract supports tasks related to IT service management and provides necessary training. The primary geographic impact is likely within the operational areas of the FAA, potentially nationwide. The contract supports IT professionals and trainers, contributing to the federal IT workforce.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Time & Materials (T&M) pricing can lead to cost escalation if not closely monitored.
- The relatively short contract duration might not allow for full realization of long-term IT service improvements.
- The broad NAICS code (541519) could encompass a wide range of services, making specific performance evaluation complex.
- Limited information on the specific training provided makes it difficult to assess its effectiveness and value.
Positive Signals
- Awarded through full and open competition, indicating a robust bidding process.
- The contract aims to improve IT service management, a critical function for agency operations.
- The contractor, The Centech Group Inc., is a known entity in the federal contracting space.
Sector Analysis
This contract falls within the broader Information Technology (IT) services sector, specifically focusing on IT service management. The IT services market is highly competitive and dynamic, with numerous companies offering specialized solutions. Contracts like this are essential for government agencies to maintain and improve their IT infrastructure and operational efficiency. Comparable spending benchmarks for IT service management contracts can vary significantly based on scope, duration, and complexity.
Small Business Impact
This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. This means that larger businesses were eligible to compete and potentially win the award. The absence of small business considerations in this specific award might limit opportunities for smaller IT service providers in this instance, though it doesn't preclude them from other opportunities.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within the Federal Aviation Administration. Performance monitoring, invoice review, and adherence to the Statement of Work (SOW) are key oversight functions. Transparency is generally maintained through contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- IT Service Management
- IT Support Services
- Training Services
- Computer Related Services
Risk Flags
- Potential for cost overruns due to Time & Materials pricing.
- Broad NAICS code may obscure specific service details and performance metrics.
- Short contract duration might limit long-term impact assessment.
Tags
it-services, service-management, time-and-materials, full-and-open-competition, department-of-transportation, federal-aviation-administration, the-centech-group-inc, naics-541519, training, it-support, moderate-value, virginia
Frequently Asked Questions
What is this federal contract paying for?
Department of Transportation awarded $10.8 million to THE CENTECH GROUP INC.. IT SERVICE MANAGEMENT TOOL SERVICES (ON A T&M BASIS) FOR TASKS 1 THROUGH 7 OF THE SOW PLUS TRAINING.
Who is the contractor on this award?
The obligated recipient is THE CENTECH GROUP INC..
Which agency awarded this contract?
Awarding agency: Department of Transportation (Federal Aviation Administration).
What is the total obligated amount?
The obligated amount is $10.8 million.
What is the period of performance?
Start: 2006-09-25. End: 2007-09-21.
What is the track record of The Centech Group Inc. in delivering IT service management solutions to the federal government?
The Centech Group Inc. has a history of performing various IT and professional services contracts with the federal government. While this specific contract focuses on IT service management and training, their broader portfolio often includes IT support, system integration, and other technology-related services. Analyzing their past performance on similar contracts, including customer satisfaction ratings and any documented performance issues or successes, would provide a more comprehensive understanding of their capabilities and reliability in delivering complex IT solutions. Their experience across different agencies and contract types can indicate their adaptability and expertise in meeting diverse federal IT requirements.
How does the Time & Materials (T&M) pricing structure compare to fixed-price options for similar IT service management contracts?
Time & Materials (T&M) contracts offer flexibility, allowing the government to pay for actual labor hours and material costs incurred. This can be advantageous when the scope of work is not clearly defined or is expected to change. However, T&M contracts carry a higher risk of cost overruns for the government, as there is no ceiling on the total expenditure. Fixed-price contracts, conversely, establish a set price for the work, providing greater cost certainty for the government but offering less flexibility if requirements evolve. For IT service management, where tasks can be well-defined, fixed-price or hybrid structures (like Firm-Fixed-Price with Time-and-Materials Labor-Hours) are often preferred to control costs and ensure predictable spending. The choice of T&M here suggests a need for flexibility or an initial uncertainty in task definition.
What are the potential risks associated with a Time & Materials contract for IT service management?
The primary risk with a Time & Materials (T&M) contract for IT service management is the potential for uncontrolled cost escalation. Since payment is based on actual hours worked and materials used, there's less incentive for the contractor to be efficient, and the government bears the risk of increased labor rates or extended timelines. Without robust oversight, monitoring, and clear task definitions, T&M contracts can significantly exceed their initial estimates. Additionally, defining and measuring 'completion' or 'success' can be more challenging compared to fixed-price contracts, potentially leading to disputes over deliverables and value received. Effective management requires diligent tracking of hours, rates, and materials, along with strong communication to ensure alignment with project goals.
How does the $10.8 million contract value compare to typical federal spending on IT service management tools and services?
A contract value of approximately $10.8 million for IT service management services over a period of roughly one year is considered a moderate-sized award within the federal IT landscape. Federal spending on IT services is vast, encompassing everything from software development and cybersecurity to infrastructure management and help desk support. Larger agencies often award multi-year, multi-million dollar contracts for enterprise-wide IT service management solutions and support. Smaller, more focused contracts like this one are common for specific projects, departmental needs, or specialized support. Benchmarking against similar procurements by agencies like the FAA or other transportation-related entities would provide a more precise comparison, but generally, this figure represents a significant but not exceptionally large investment in IT service management.
What does the 'Other Computer Related Services' NAICS code (541519) imply about the scope of this contract?
The NAICS code 541519, 'Other Computer Related Services,' is a broad category that encompasses a wide array of IT services not specifically classified under other codes. This includes services such as computer facilities management, computer disaster recovery services, computer virus protection services, and IT support services. For this contract, it suggests that the scope of IT service management and training provided by The Centech Group Inc. could be quite diverse, potentially covering aspects like help desk operations, system monitoring, software deployment, IT policy development, and user support. The generality of the code underscores the importance of thoroughly reviewing the Statement of Work (SOW) to understand the precise nature and limitations of the services being procured.
What is the significance of the contract being awarded on a Time & Materials (T&M) basis for the Federal Aviation Administration (FAA)?
Awarding an IT service management contract on a Time & Materials (T&M) basis signifies that the Federal Aviation Administration (FAA) likely required flexibility in the scope or duration of the services. T&M contracts are often used when the exact effort or number of hours needed is uncertain at the time of award, or when the work is expected to evolve. For the FAA, this could mean adapting to changing IT needs, unforeseen technical challenges, or varying levels of demand for support and training. While offering agility, the FAA must implement stringent oversight mechanisms, including detailed monitoring of labor hours, rates, and materials, to mitigate the inherent risk of cost overruns associated with T&M contracts and ensure they receive fair value for their investment.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6402 ARLINGTON BLVD STE 1000, FALLS CHURCH, VA, 08
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Hispanic American Owned Business, Minority Owned Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $43,622,100
Exercised Options: $10,782,915
Current Obligation: $10,782,915
Parent Contract
Parent Award PIID: DTFAWA06D00029
IDV Type: IDC
Timeline
Start Date: 2006-09-25
Current End Date: 2007-09-21
Potential End Date: 2007-09-21 00:00:00
Last Modified: 2011-03-15
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