GSA awards $29M for ADP Software to Northrop Grumman, highlighting cost-plus contract
Contract Overview
Contract Amount: $28,979,799 ($29.0M)
Contractor: Northrop Grumman Information Technology Inc
Awarding Agency: General Services Administration
Start Date: 2007-08-30
End Date: 2012-08-30
Contract Duration: 1,827 days
Daily Burn Rate: $15.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE
Sector: IT
Official Description: ADP SOFTWARE
Place of Performance
Location: ALGONAC, ST. CLAIR County, MICHIGAN, 48001, UNITED STATES OF AMERICA
State: Michigan Government Spending
Plain-Language Summary
General Services Administration obligated $29.0 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC for work described as: ADP SOFTWARE Key points: 1. Significant contract value of $29 million over 5 years. 2. Northrop Grumman is the sole awardee, raising questions about competition. 3. Cost-plus contract type introduces potential for cost overruns. 4. Spending falls under Computer and Software Stores sector.
Value Assessment
Rating: questionable
The contract uses a Cost Plus Incentive Fee structure, which can lead to higher costs than fixed-price contracts. Benchmarking against similar ADP software contracts is difficult without more detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Although listed as 'full and open competition,' the award went to a single contractor. This suggests potential issues in the bidding process or that only one vendor could meet the specific requirements.
Taxpayer Impact: The cost-plus nature of the contract means taxpayers bear the risk of cost increases, potentially leading to higher overall expenditure than initially anticipated.
Public Impact
Taxpayers may face higher costs due to the incentive fee structure. The long duration of the contract (5 years) locks in this vendor. Lack of transparency in the competition process could indicate missed opportunities for better pricing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus contract type
- Sole awardee despite full and open competition
- Long contract duration
Positive Signals
- Awarded by GSA, a major procurement agency
- Contract for essential ADP software
Sector Analysis
This contract falls within the IT sector, specifically computer and software stores. Spending in this area is substantial across the federal government, with varying contract types and competition levels.
Small Business Impact
No indication of small business participation is provided in the data. Larger contracts often involve prime contractors who may or may not subcontract to small businesses.
Oversight & Accountability
The contract's cost-plus nature warrants close oversight to ensure costs remain reasonable and aligned with performance incentives. Tracking expenditures against the incentive fee structure is crucial.
Related Government Programs
- Computer and Software Stores
- General Services Administration Contracting
- Federal Acquisition Service Programs
Risk Flags
- Potential for cost overruns due to CPIF structure.
- Lack of clarity on competition effectiveness despite 'full and open' status.
- Long contract duration limits flexibility.
- No small business participation noted.
Tags
computer-and-software-stores, general-services-administration, mi, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
General Services Administration awarded $29.0 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC. ADP SOFTWARE
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC.
Which agency awarded this contract?
Awarding agency: General Services Administration (Federal Acquisition Service).
What is the total obligated amount?
The obligated amount is $29.0 million.
What is the period of performance?
Start: 2007-08-30. End: 2012-08-30.
What specific ADP software functionalities were procured, and how did Northrop Grumman's offering uniquely meet these needs to justify a sole award under full and open competition?
The provided data does not detail the specific functionalities of the ADP software. Understanding the unique technical requirements or performance specifications is crucial to assessing why only one vendor, Northrop Grumman, was selected despite the 'full and open competition' designation. This information would help determine if the competition was truly robust or if the requirements were overly restrictive.
How are the 'incentive fee' components structured within this Cost Plus Incentive Fee contract, and what metrics are used to determine the fee?
The data does not specify the incentive fee structure or the metrics used. A Cost Plus Incentive Fee (CPIF) contract typically involves a target cost, a target fee, and a fee-sharing arrangement where both the government and contractor share in cost savings or overruns relative to the target cost. Understanding these details is vital for assessing potential cost efficiencies and contractor performance.
What is the benchmarked cost per unit or per user for this ADP software compared to similar government or commercial contracts?
The provided data lacks the necessary detail to establish a per-unit cost benchmark. Factors like the specific software modules, user licenses, support levels, and contract duration significantly influence pricing. Without this granular information, a direct comparison to similar contracts is not feasible, making it difficult to assess cost-effectiveness.
Industry Classification
NAICS: Retail Trade › Electronics and Appliance Stores › Computer and Software Stores
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SEALED BID
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: Titan II Inc. (UEI: 016435559)
Address: 7575 COLSHIRE DRIVE, MC LEAN, VA, 22102
Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $35,184,489
Exercised Options: $36,267,982
Current Obligation: $28,979,799
Timeline
Start Date: 2007-08-30
Current End Date: 2012-08-30
Potential End Date: 2012-08-30 00:00:00
Last Modified: 2015-07-10
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