KPMG LLP awarded $68.9M DoD contract for administrative management consulting services

Contract Overview

Contract Amount: $68,947,457 ($68.9M)

Contractor: Kpmg LLP

Awarding Agency: Department of Defense

Start Date: 2022-02-25

End Date: 2026-05-28

Contract Duration: 1,553 days

Daily Burn Rate: $44.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PKS-HILL-BECK-AFSTS DCSA REFORM AWARD.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20330

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $68.9 million to KPMG LLP for work described as: PKS-HILL-BECK-AFSTS DCSA REFORM AWARD. Key points: 1. Contract provides administrative management and general management consulting services. 2. Awarded under full and open competition, indicating a broad search for qualified contractors. 3. The contract has a duration of 1553 days, spanning over four years. 4. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 5. The primary agency is the Department of Defense, with the Air Force as the servicing agency. 6. The contract is a delivery order, suggesting it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract.

Value Assessment

Rating: good

The contract value of $68.9 million over approximately four years for administrative management consulting services appears reasonable given the scope and duration. Benchmarking against similar large-scale consulting contracts within the federal government suggests this pricing is within expected ranges for complex management support. The firm fixed-price nature of the contract provides cost certainty for the government, although it requires careful scope management to ensure value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. The presence of 4 bids indicates a healthy level of interest and competition for this requirement. This competitive process is designed to ensure the government receives the best value by allowing multiple firms to propose their solutions and pricing.

Taxpayer Impact: Full and open competition generally leads to more competitive pricing for taxpayers, as contractors vie to win the award by offering the most attractive terms and cost-effective solutions.

Public Impact

The Department of Defense benefits from enhanced administrative and management consulting services. Services delivered are expected to improve operational efficiency and strategic planning within the Air Force. The primary geographic impact is within the District of Columbia, where the contractor is located. The contract supports professional services roles, potentially impacting a specialized workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if not managed tightly due to the long duration.
Reliance on a single contractor for critical management functions could pose a risk if performance falters.

Positive Signals

Firm Fixed Price contract structure provides cost predictability.
Full and open competition suggests a robust selection process.
Awarded to a well-established contractor with a track record in government contracting.

Sector Analysis

The administrative management and general management consulting services sector is a significant part of the federal procurement landscape, supporting a wide array of agency functions. This contract falls within the professional services category, which is characterized by a large number of small and large businesses competing for government work. Spending in this sector is often driven by needs for strategic planning, organizational efficiency improvements, and specialized expertise that agencies may not possess internally. Comparable spending benchmarks for large consulting engagements can range from tens to hundreds of millions of dollars, depending on the complexity and duration.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. The award to a large firm like KPMG LLP suggests that the primary focus was on obtaining specialized expertise, and opportunities for small businesses may be limited unless they are partners or subcontractors to the prime. Further analysis of the contract's subcontracting plan would be needed to fully assess the impact on the small business ecosystem.

Oversight & Accountability

The contract is a delivery order, likely under an existing IDIQ vehicle, which implies that oversight mechanisms are in place at the IDIQ level. The firm fixed-price nature of the contract provides a degree of financial oversight by fixing the total cost. Transparency is generally maintained through contract award databases and reporting requirements. Specific oversight would be managed by the contracting officer and program managers within the Department of the Air Force.

Related Government Programs

Management and Financial Consulting, Acquisition and Technology Services
Professional Services Schedule (PSS)
Defense-wide Administrative Support Contracts

Risk Flags

Long contract duration may increase risk of scope creep.
Firm Fixed Price requires careful management to ensure value.
Reliance on a single prime contractor for critical functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $68.9 million to KPMG LLP. PKS-HILL-BECK-AFSTS DCSA REFORM AWARD.

Who is the contractor on this award?

The obligated recipient is KPMG LLP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $68.9 million.

What is the period of performance?

Start: 2022-02-25. End: 2026-05-28.

What is KPMG LLP's track record with federal contracts, particularly within the Department of Defense?

KPMG LLP has a significant history of performing federal contracts across various agencies, including the Department of Defense. Their contract portfolio often includes services related to financial management, IT consulting, cybersecurity, and administrative support. For the Department of Defense specifically, KPMG has been involved in large-scale transformation initiatives, audit support, and strategic planning projects. Their performance history can be reviewed through federal procurement data systems like FPDS-NG, which tracks contract awards, task orders, and contractor performance information. While specific performance ratings are not publicly detailed for every contract, their continued success in winning competitive bids suggests a generally positive track record in delivering services to government clients.

How does the $68.9 million contract value compare to similar administrative consulting contracts awarded by the DoD?

The $68.9 million contract value for administrative management and general management consulting services awarded to KPMG LLP is substantial, reflecting a significant engagement. When compared to similar large-scale consulting contracts within the Department of Defense, this value is within a reasonable range for multi-year, comprehensive support. For instance, other major consulting firms have secured contracts in the tens to hundreds of millions of dollars for strategic planning, organizational reform, and complex program management support. The firm fixed-price nature of this award also suggests a defined scope, which helps in value assessment. However, a precise benchmark would require comparing contracts with identical service descriptions, durations, and specific agency needs, which can vary widely.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks associated with this contract include potential scope creep due to its long duration (over four years), contractor performance issues, and the possibility of cost overruns if the firm fixed-price model is not managed effectively. Mitigation strategies likely involve robust contract management by the Air Force, including detailed performance metrics, regular progress reviews, and clear change control processes. The firm fixed-price structure itself mitigates financial risk for the government by capping the total cost, provided the scope is well-defined and managed. The selection of KPMG LLP, a large firm with extensive experience, also serves as a risk mitigation factor, suggesting a higher likelihood of successful execution. However, ongoing vigilance and active contract oversight are crucial.

What is the expected impact of this contract on the Department of the Air Force's operational effectiveness?

This contract is expected to enhance the operational effectiveness of the Department of the Air Force by providing expert administrative management and general management consulting services. These services can lead to improvements in areas such as strategic planning, process optimization, resource allocation, and organizational efficiency. By leveraging external expertise, the Air Force can address complex management challenges, implement best practices, and potentially streamline operations, freeing up internal resources to focus on core mission requirements. The ultimate impact will depend on the specific objectives outlined in the contract and the successful implementation of the consultant's recommendations.

How has federal spending on administrative management consulting services evolved over the past five years, and where does this contract fit?

Federal spending on administrative management and general management consulting services has generally seen a steady increase over the past five years, driven by agency needs for modernization, efficiency improvements, and support for complex initiatives. Agencies like the Department of Defense consistently represent a significant portion of this spending due to their vast operational scope and ongoing transformation efforts. This $68.9 million contract for the Air Force fits within this trend as a substantial, long-term engagement aimed at improving management functions. It reflects the continued reliance of large federal agencies on external expertise to navigate complex administrative challenges and achieve strategic goals, aligning with broader patterns of professional services procurement.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting 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: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 8350 BROAD ST STE 900, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $154,811,222

Exercised Options: $106,793,437

Current Obligation: $68,947,457

Actual Outlays: $31,873,163

Subaward Activity

Number of Subawards: 11

Total Subaward Amount: $5,189,184

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA701420D0009

IDV Type: IDC

Timeline