Booz Allen Hamilton awarded $260M for Computer Systems Design Services by Department of Defense

Contract Overview

Contract Amount: $260,159,732 ($260.2M)

Contractor: Booz Allen Hamilton Inc

Awarding Agency: Department of Defense

Start Date: 2003-10-03

End Date: 2009-09-30

Contract Duration: 2,189 days

Daily Burn Rate: $118.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: TIME AND MATERIALS

Sector: IT

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102, UNITED STATES OF AMERICA

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $260.2 million to BOOZ ALLEN HAMILTON INC for work described as: Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Time and Materials, which can pose cost control challenges. 3. The duration of the contract is substantial, spanning over 6 years. 4. The award was made by the Defense Contract Management Agency, indicating a focus on defense-related IT needs. 5. The North American Industry Classification System (NAICS) code 541512 points to a focus on computer systems design. 6. The contract value is significant, reflecting a substantial investment in IT services.

Value Assessment

Rating: fair

The contract value of $260 million over approximately six years suggests a significant investment. Benchmarking this against similar large-scale IT services contracts within the Department of Defense is crucial for a precise value-for-money assessment. Without specific performance metrics or comparison data for the services rendered, it's difficult to definitively assess if the pricing is competitive or if the value delivered aligns with market rates. The Time and Materials pricing structure, while flexible, can sometimes lead to higher overall costs if not managed diligently.

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 presence of two bids suggests a moderate level of competition for this significant IT services contract. While two bidders is better than a sole-source award, a higher number of bidders typically leads to more robust price discovery and potentially lower costs for the government.

Taxpayer Impact: The full and open competition, despite having only two bidders, provides some assurance that taxpayer funds were sought through a structured process. However, the limited number of bids may mean that the government did not achieve the most competitive pricing possible.

Public Impact

The primary beneficiaries are likely Department of Defense agencies requiring advanced computer systems design and integration services. The services delivered are expected to enhance the operational capabilities and technological infrastructure of defense operations. The geographic impact is primarily within the United States, supporting defense installations and command centers. The contract supports a workforce skilled in IT, systems engineering, and cybersecurity within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to cost overruns if not closely monitored.
Limited competition (2 bidders) may have resulted in a higher price than a more competitive scenario.
The long duration of the contract could lead to scope creep or outdated technology if not managed proactively.

Positive Signals

Awarded through full and open competition, ensuring a structured procurement process.
The contractor, Booz Allen Hamilton, is a well-established entity with significant experience in government contracting.
The contract addresses critical IT needs for the Department of Defense.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer systems design and integration. The market for these services within the federal government, particularly for defense applications, is substantial. Comparable spending benchmarks would involve analyzing other large IT services contracts awarded by the DoD and other federal agencies for similar system design and development work. The size of this award indicates a significant project requiring specialized expertise.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no explicit information regarding subcontracting plans for small businesses. This means that the primary contract is likely to be performed by the large prime contractor, with limited direct opportunities for small businesses unless they are part of Booz Allen Hamilton's supply chain or chosen as subcontractors without a formal set-aside requirement.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA) and the contracting officer within the Department of Defense. Accountability measures would be embedded in the contract's terms and conditions, including performance standards and reporting requirements. Transparency is facilitated through contract award databases, though detailed performance data may be less accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense IT Modernization Programs
Defense Information Systems Agency (DISA) Contracts
Federal Civilian IT Services Contracts
Cybersecurity Services Contracts
Systems Engineering and Technical Assistance (SETA) Contracts

Risk Flags

Potential for cost overruns due to Time and Materials contract type.
Limited competition may have impacted price competitiveness.
Long contract duration requires sustained oversight to prevent scope creep and obsolescence.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $260.2 million to BOOZ ALLEN HAMILTON INC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is BOOZ ALLEN HAMILTON INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $260.2 million.

What is the period of performance?

Start: 2003-10-03. End: 2009-09-30.

What is Booz Allen Hamilton's track record with similar Department of Defense IT contracts?

Booz Allen Hamilton is a major government contractor with extensive experience serving the Department of Defense across a wide range of IT, consulting, and engineering services. They have a long history of managing large, complex contracts, including those involving systems design, integration, and modernization. Their track record includes numerous awards and successful contract completions, though like any large contractor, they have also faced scrutiny and reviews on specific projects. Analyzing their past performance on contracts with similar scope, duration, and technical requirements would provide further insight into their capabilities and reliability for this specific award.

How does the $260 million value compare to other computer systems design contracts within the DoD?

The $260 million award is a substantial figure, placing it among significant IT services contracts within the Department of Defense. To benchmark its value, one would compare it to other contracts awarded under NAICS code 541512 or similar codes for systems design, integration, and IT support services. The DoD frequently awards multi-million dollar contracts for complex IT solutions. Factors such as contract duration, specific deliverables, and the level of technical expertise required influence these values. A detailed comparison would involve looking at the average contract value, the range of values, and the number of bidders for comparable DoD IT projects over the past few years.

What are the primary risks associated with a Time and Materials (T&M) contract of this magnitude?

The primary risk with a Time and Materials (T&M) contract, especially one valued at $260 million, is the potential for cost overruns. Unlike fixed-price contracts, T&M contracts reimburse the contractor for direct labor hours at specified hourly rates and for the actual cost of materials. If project scope is not tightly managed, or if labor hours are not diligently tracked and justified, costs can escalate beyond initial estimates. This necessitates robust government oversight to ensure that all hours billed are reasonable, allocable, and necessary for the work performed. The long duration of this contract further amplifies this risk, requiring sustained vigilance.

What does the limited competition (2 bidders) imply for the effectiveness of the procurement process?

Limited competition, such as the two bidders in this case, can raise questions about the overall effectiveness of the procurement process in achieving the best possible value for taxpayers. While 'full and open competition' was utilized, a low number of bids suggests that fewer potential contractors participated than might have been expected for a contract of this size and scope. This could be due to various factors, including stringent pre-qualification requirements, the complexity of the solicitation, or the specific market conditions. A higher number of bidders typically fosters greater price competition and innovation, potentially leading to lower costs and better solutions. Therefore, two bidders suggest a moderate, rather than robust, level of market engagement.

How has federal spending on computer systems design services evolved over the past decade?

Federal spending on computer systems design services has generally trended upwards over the past decade, driven by the increasing digitization of government operations, modernization efforts, and the growing demand for advanced IT solutions, particularly in areas like cybersecurity, cloud computing, and data analytics. Agencies across the government, including the Department of Defense, consistently allocate significant portions of their budgets to IT services. While specific figures fluctuate annually based on budget appropriations and strategic priorities, the overall trajectory indicates a sustained and often increasing reliance on external expertise for designing, implementing, and maintaining complex computer systems.

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

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Booz Allen Hamilton Holding Corporation (UEI: 964725688)

Address: 8283 GREENSBORO DR, MCLEAN, VA, 22102

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $262,284,518

Exercised Options: $191,307,864

Current Obligation: $260,159,732

Parent Contract

Parent Award PIID: GS35F0306J

IDV Type: FSS

Timeline