DoD's $40.7M IGF Automated Virtual Information Production Support System contract awarded to Northrop Grumman
Contract Overview
Contract Amount: $40,688,983 ($40.7M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2015-06-23
End Date: 2017-08-30
Contract Duration: 799 days
Daily Burn Rate: $50.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: IGF::OT::IGF AUTOMATED VIRTUAL INFORMATION PRODUCTION SUPPORT SYSTEM V
Place of Performance
Location: FAIRBORN, GREENE County, OHIO, 45324
State: Ohio Government Spending
Plain-Language Summary
Department of Defense obligated $40.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: IGF::OT::IGF AUTOMATED VIRTUAL INFORMATION PRODUCTION SUPPORT SYSTEM V Key points: 1. Contract awarded to a large, established defense contractor. 2. The contract was awarded via full and open competition. 3. Potential for cost overruns exists given the Cost Plus Fixed Fee contract type. 4. The Engineering Services sector is competitive, but specific system needs may limit options.
Value Assessment
Rating: good
The contract value of $40.7M for a 2-year period appears reasonable for specialized virtual information production support. Benchmarking against similar complex engineering services contracts would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The use of full and open competition suggests a robust price discovery process. However, the Cost Plus Fixed Fee (CPFF) structure requires careful monitoring to ensure costs remain within reasonable bounds.
Taxpayer Impact: Taxpayer funds are being used for a specialized system, with competition aiming for value. CPFF contracts necessitate strong oversight to prevent unnecessary cost escalation.
Public Impact
Supports critical Air Force operations with automated information production. Enhances efficiency and potentially reduces manual labor costs. Technology investment may lead to long-term cost savings and improved data accessibility.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type can incentivize higher costs.
- Contract duration of nearly two years requires ongoing performance monitoring.
Positive Signals
- Awarded through full and open competition.
- Supports critical Department of Defense functions.
Sector Analysis
This contract falls within the Engineering Services sector, which is broad and encompasses a wide range of technical support. Spending in this sector is significant, driven by complex government and private sector needs.
Small Business Impact
The awardee, Northrop Grumman, is a large business. There is no indication of small business participation in this specific contract award, which is common for large, complex system development contracts.
Oversight & Accountability
The Department of the Air Force is responsible for oversight. Given the CPFF contract type, rigorous financial and performance oversight is crucial to ensure cost control and effective delivery of services.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Cost Plus Fixed Fee contract type.
- Potential for cost overruns.
- Lack of explicit small business participation.
- Contract duration requires sustained oversight.
Tags
engineering-services, department-of-defense, oh, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $40.7 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. IGF::OT::IGF AUTOMATED VIRTUAL INFORMATION PRODUCTION SUPPORT SYSTEM V
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
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 $40.7 million.
What is the period of performance?
Start: 2015-06-23. End: 2017-08-30.
What specific performance metrics are in place to ensure the 'virtual information production support system' meets its intended operational goals and provides value for money?
The contract likely includes specific performance work statements (PWS) with measurable metrics tied to system uptime, data processing speed, accuracy of information produced, and user satisfaction. Regular performance reviews and milestone assessments by the Air Force contracting officer's representative (COR) are essential to track progress and ensure the system delivers the expected value and meets operational requirements effectively.
How is the 'fixed fee' component of the Cost Plus Fixed Fee contract determined, and what mechanisms prevent it from being inflated due to cost-plus elements?
The fixed fee is typically negotiated at the outset based on the contractor's estimated effort, complexity, and risk. It represents the profit margin. While the 'cost-plus' part covers allowable costs, the fixed fee itself is not directly tied to those costs. However, robust auditing and cost accounting standards are crucial to ensure only allowable costs are reimbursed, indirectly influencing the overall value and preventing fee inflation.
What is the long-term strategy for maintaining and upgrading this 'virtual information production support system' beyond the contract's end date, and what is the estimated future cost?
The long-term strategy would likely involve follow-on contracts for sustainment, maintenance, and potential upgrades, or transitioning the system to an in-house government capability. The estimated future cost would depend on the system's complexity, technological obsolescence rates, and the chosen sustainment approach. Planning for these future costs is critical for budget forecasting and ensuring continued operational effectiveness.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering 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: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation (UEI: 967356127)
Address: 2340 DULLES CORNER BLVD, HERNDON, VA, 20171
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $174,069,434
Exercised Options: $41,374,549
Current Obligation: $40,688,983
Subaward Activity
Number of Subawards: 146
Total Subaward Amount: $28,591,195
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS00Q14OADU325
IDV Type: IDC
Timeline
Start Date: 2015-06-23
Current End Date: 2017-08-30
Potential End Date: 2017-08-30 00:00:00
Last Modified: 2017-06-12
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