DoD's $45M DEAMS ERP contract to Lintech Global Inc. shows strong competition and long-term performance

Contract Overview

Contract Amount: $45,023,761 ($45.0M)

Contractor: Lintech Global Inc

Awarding Agency: Department of Defense

Start Date: 2018-02-02

End Date: 2023-08-01

Contract Duration: 2,006 days

Daily Burn Rate: $22.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: DEFENSE ENTERPRISE ACCOUNTING MANAGEMENT SYSTEM (DEAMS) ERP SOLUTIONS ARCHITECTURE SERVICES 2 (ESA2)

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $45.0 million to LINTECH GLOBAL INC for work described as: DEFENSE ENTERPRISE ACCOUNTING MANAGEMENT SYSTEM (DEAMS) ERP SOLUTIONS ARCHITECTURE SERVICES 2 (ESA2) Key points: 1. This contract represents a significant investment in modernizing defense enterprise accounting systems. 2. The firm-fixed-price structure suggests a clear understanding of project scope and cost control. 3. A long performance period indicates a need for sustained support and system evolution. 4. The use of full and open competition after exclusion of sources implies a deliberate procurement strategy. 5. The contract's value aligns with the complexity of enterprise resource planning solutions in large organizations. 6. Performance in Virginia highlights the geographic concentration of defense IT support services.

Value Assessment

Rating: good

The contract's value of approximately $45 million over its duration is substantial, reflecting the complexity of ERP solutions for a major agency like the Department of Defense. Benchmarking against similar large-scale ERP implementations within the federal government suggests this figure is within a reasonable range, considering the scope and duration. The firm-fixed-price contract type generally indicates a well-defined scope, which can lead to better value if managed effectively. However, without specific details on deliverables and performance metrics, a precise value-for-money assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while the competition was broad, specific sources may have been excluded based on pre-defined criteria or prior performance. The presence of 5 bidders suggests a healthy level of competition, which is generally favorable for price discovery and innovation. This approach aims to balance the benefits of open competition with the need for specialized capabilities or specific system integrations.

Taxpayer Impact: This competitive approach likely resulted in a more favorable price for taxpayers compared to a sole-source award. The multiple bids indicate that the government received a range of offers, allowing for selection of the best value.

Public Impact

The Department of Defense benefits from modernized accounting and financial management capabilities. Military personnel and civilian staff gain access to improved enterprise resource planning tools. The contract supports critical financial operations across various defense entities. The IT services sector sees continued investment, supporting jobs in computer systems design. The geographic impact is primarily within Virginia, a hub for defense contracting and IT services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in long-term ERP contracts if not managed rigorously.
Dependence on a single contractor for critical financial system support over an extended period.
Ensuring continued alignment with evolving DoD financial regulations and cybersecurity requirements.

Positive Signals

Firm-fixed-price contract type provides cost certainty.
Demonstrated competition indicates a robust selection process.
Long performance period suggests contractor capability and sustained need for services.
Award to a known entity (Lintech Global Inc.) implies prior vetting or relevant experience.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer systems design and integration for enterprise resource planning (ERP) solutions. The federal government is a major consumer of such services, with significant spending allocated to modernizing financial management, logistics, and human resources systems. Comparable spending benchmarks for large-scale ERP implementations within federal agencies often range in the tens to hundreds of millions of dollars, depending on the scope, duration, and complexity of the system being supported or developed. This contract's value appears consistent with the scale of supporting a critical defense-wide system.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large contract awarded through full and open competition, it is unlikely that small businesses would be primary awardees unless they were part of a joint venture or subcontracting team. The impact on the small business ecosystem would depend on whether Lintech Global Inc. engages small businesses for subcontracting opportunities, which is not specified in the provided data.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program management office within the Department of the Air Force. Accountability measures are inherent in the firm-fixed-price contract type, requiring the contractor to deliver specified services within the agreed-upon cost. Transparency is generally facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

Defense Enterprise Accounting Management System (DEAMS)
Enterprise Resource Planning (ERP) Solutions
Department of Defense Financial Management Systems
IT Services for Federal Agencies
Computer Systems Design Services

Risk Flags

Long contract duration may increase risk of technology obsolescence.
Potential for contractor performance degradation over extended period.
Dependence on specific architectural services could lead to vendor lock-in.
Need for rigorous oversight to manage scope and ensure alignment with evolving requirements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $45.0 million to LINTECH GLOBAL INC. DEFENSE ENTERPRISE ACCOUNTING MANAGEMENT SYSTEM (DEAMS) ERP SOLUTIONS ARCHITECTURE SERVICES 2 (ESA2)

Who is the contractor on this award?

The obligated recipient is LINTECH GLOBAL INC.

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 $45.0 million.

What is the period of performance?

Start: 2018-02-02. End: 2023-08-01.

What is the track record of Lintech Global Inc. in delivering similar large-scale ERP solutions for the federal government?

Assessing Lintech Global Inc.'s track record requires a deeper dive into their past performance on federal contracts, particularly those involving Enterprise Resource Planning (ERP) systems. While this specific contract is for DEAMS ERP Solutions Architecture Services, it's crucial to examine if they have successfully managed and delivered comparable projects in terms of scale, complexity, and duration. Information on past performance, including client satisfaction, adherence to schedule and budget, and technical execution, would be available through sources like the Federal Procurement Data System (FPDS) or contractor performance assessment reports (CPARS). A history of successful ERP implementations would bolster confidence in their ability to meet the demands of this significant DoD contract. Conversely, any past issues or underperformance on similar projects would raise concerns about risk.

How does the per-unit cost or pricing structure of this contract compare to industry benchmarks for ERP architecture services?

Determining the precise per-unit cost or comparing the pricing structure to industry benchmarks for ERP architecture services is challenging without detailed breakdowns of the services provided and their associated costs. The provided data indicates a firm-fixed-price contract, which sets a total price for a defined scope of work. To benchmark, one would need to identify specific service components (e.g., hours of consulting, specific architectural deliverables) and compare their rates or total costs against market data for similar roles and services within the federal IT contracting space. Factors like the contractor's overhead, profit margins, and the specific technical expertise required influence pricing. A comparison would ideally involve analyzing rates for senior architects, system integrators, and project managers involved in the contract, benchmarked against GSA schedules or industry surveys for comparable skill sets and experience levels.

What are the primary risks associated with a long-duration contract (over 5 years) for ERP architecture services?

Long-duration contracts for ERP architecture services, like this one spanning over five years, carry several inherent risks. Technology obsolescence is a significant concern; ERP systems and architectural best practices evolve rapidly, and a system designed or architected early in the contract may become outdated by its end. Contractor performance degradation is another risk, as motivation or capability might wane over extended periods, or key personnel could depart. Scope creep is also a common issue, where evolving requirements lead to expanded work beyond the original agreement, potentially increasing costs or delaying timelines if not managed strictly. Furthermore, dependence on a single vendor for such a critical, long-term function can create vendor lock-in and reduce flexibility for the agency. Robust contract management, regular performance reviews, and clear change control processes are essential to mitigate these risks.

How effective has the 'Full and Open Competition After Exclusion of Sources' strategy been in ensuring value for this specific contract?

The effectiveness of 'Full and Open Competition After Exclusion of Sources' in ensuring value for this specific contract hinges on the justification for excluding certain sources and the subsequent competitive landscape. This strategy implies that while the competition was broad, specific pre-qualified or previously vetted vendors were considered, potentially streamlining the process or ensuring a baseline of capability. The fact that five bidders participated suggests that the exclusion criteria did not unduly limit competition. To assess value, one would analyze if the chosen contractor, Lintech Global Inc., offered the best combination of technical approach, past performance, and price compared to the other bidders. If the excluded sources were highly capable and their exclusion prevented potentially better offers, then the value might be compromised. However, if the exclusions were justified (e.g., based on security, specific technical expertise, or prior performance issues), and the resulting competition yielded a strong offer, then value was likely enhanced.

What is the historical spending pattern for DEAMS ERP Solutions Architecture Services, and how does this contract compare?

Analyzing the historical spending pattern for DEAMS ERP Solutions Architecture Services requires accessing historical contract data for this specific program. The provided data shows a single award of approximately $45 million with a start date of 2018 and an end date of 2023, indicating a significant, long-term investment. To understand the pattern, one would look for previous contracts related to DEAMS architecture, their values, durations, and awardees. If this $45 million contract represents the entirety or a major portion of the spending on architecture services for DEAMS over its period, it suggests a substantial and sustained need. Comparing it to prior or subsequent contracts would reveal trends in spending levels, whether the program is in a growth, maintenance, or sunset phase, and if there have been shifts in contracting strategies or vendor selection over time. Without that historical context, it's difficult to definitively state how this contract fits into a broader spending pattern.

What are the potential implications of this contract on the broader Defense Enterprise Accounting Management System (DEAMS) program's success?

This contract for DEAMS ERP Solutions Architecture Services is critical to the overall success of the DEAMS program. Architecture services define the foundational structure, design principles, and technical roadmap for the entire ERP system. High-quality architecture ensures that DEAMS is scalable, secure, interoperable with other defense systems, and adaptable to future requirements. If Lintech Global Inc. provides robust and forward-thinking architectural guidance, it can lead to a more efficient, cost-effective, and long-lasting ERP solution. Conversely, flawed architecture could result in system instability, integration challenges, increased maintenance costs, and difficulties in implementing future upgrades or functionalities, potentially jeopardizing the program's objectives and return on investment for the Department of Defense.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 34119 W 12 MILE ROAD STE 200, FARMINGTON HILLS, MI, 48331

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Small Business, Small Disadvantaged Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $58,202,756

Exercised Options: $55,526,460

Current Obligation: $45,023,761

Actual Outlays: $9,268,821

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS06F1116Z

IDV Type: GWAC

Timeline