DoD's $90M Audit Infrastructure Support Services contract awarded to Guidehouse Inc. shows potential for value concerns

Contract Overview

Contract Amount: $89,800,797 ($89.8M)

Contractor: Guidehouse Inc.

Awarding Agency: Department of Defense

Start Date: 2020-10-26

End Date: 2026-04-26

Contract Duration: 2,008 days

Daily Burn Rate: $44.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: AUDIT INFRASTRUCTURE SUPPORT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20301

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $89.8 million to GUIDEHOUSE INC. for work described as: AUDIT INFRASTRUCTURE SUPPORT SERVICES Key points: 1. The contract's value of approximately $90 million over its potential duration raises questions about cost-effectiveness. 2. Competition was full and open, suggesting a potentially competitive pricing environment, but specific benchmarks are needed. 3. The contract is for administrative management and general management consulting services, a broad category. 4. Performance context is limited without specific deliverables and performance metrics. 5. The contract falls within the professional services sector, specifically management consulting. 6. The duration of the contract (up to 2026) allows for sustained support but also prolonged potential overspending.

Value Assessment

Rating: fair

The contract's total value of nearly $90 million warrants careful scrutiny against similar engagements. Without detailed task orders and performance metrics, it's difficult to benchmark the value for money. The firm fixed-price structure provides some cost certainty, but the overall price needs to be assessed against the specific services rendered and their impact. Comparisons to other large-scale management consulting contracts within the Department of Defense or other federal agencies would be necessary for a more definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The number of bidders is not specified, but this method generally fosters price discovery and encourages competitive pricing. The agency sought proposals from all responsible sources, which is a positive sign for achieving a fair market price.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically leads to more competitive pricing and a wider range of innovative solutions, potentially reducing overall costs.

Public Impact

The Department of Defense benefits from enhanced audit infrastructure support. Services provided likely include consulting, analysis, and implementation related to audit processes and systems. The contract's primary geographic impact is within Washington D.C., where the Washington Headquarters Services is located. The contract supports federal administrative functions, indirectly impacting the federal workforce by improving operational efficiency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep given the broad nature of 'Administrative Management and General Management Consulting Services'.
Lack of specific performance metrics makes it difficult to assess true value for money.
Long contract duration could lead to complacency or reduced urgency if not actively managed.

Positive Signals

Awarded through full and open competition, suggesting a competitive process.
Firm fixed-price contract type provides cost predictability.
Contract supports critical audit infrastructure, implying a necessary government function.

Sector Analysis

This contract falls within the professional services sector, specifically management and administrative consulting. This sector is characterized by a wide range of firms offering expertise in areas such as organizational efficiency, financial management, and strategic planning. The federal government is a significant consumer of these services, particularly within large departments like Defense, to improve operations and compliance. Benchmarking this contract's value would involve comparing its total value and per-task costs to similar large-scale consulting engagements awarded by federal agencies.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside requirement (ss: false, sb: false). While awarded through full and open competition, there is no explicit information on subcontracting plans for small businesses. The impact on the small business ecosystem is therefore unclear and depends on the prime contractor's subcontracting practices.

Oversight & Accountability

Oversight for this contract would primarily reside with the Washington Headquarters Services (WHS) within the Department of Defense. The firm fixed-price nature provides some level of cost control. Transparency would be enhanced by public reporting of task orders and performance outcomes. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract.

Related Government Programs

Defense Contract Audit Agency Support
Federal Financial Management Consulting
Government Management Consulting Services
Department of Defense Administrative Support

Risk Flags

Potential for cost overruns if scope is not tightly managed.
Risk of service quality degradation over the contract's long duration.
Need for clear performance metrics to ensure value for money.
Potential for services to become outdated due to market/tech changes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $89.8 million to GUIDEHOUSE INC.. AUDIT INFRASTRUCTURE SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is GUIDEHOUSE INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Washington Headquarters Services).

What is the total obligated amount?

The obligated amount is $89.8 million.

What is the period of performance?

Start: 2020-10-26. End: 2026-04-26.

What specific audit infrastructure support services are being provided under this contract?

The contract, 'AUDIT INFRASTRUCTURE SUPPORT SERVICES,' awarded to Guidehouse Inc. by the Department of Defense's Washington Headquarters Services, falls under the North American Industry Classification System (NAICS) code 541611 for Administrative Management and General Management Consulting Services. While the specific deliverables are not detailed in the provided data, this category typically encompasses a broad range of services. These could include strategic planning, organizational analysis, process improvement, financial management consulting, IT strategy related to administrative functions, and support for compliance and audit readiness. The 'audit infrastructure' aspect suggests a focus on the systems, processes, and frameworks that support the government's internal and external audit functions, potentially including risk assessment, internal controls, and audit reporting mechanisms. Further details on task orders would clarify the precise nature of the support.

How does the $90 million contract value compare to similar audit support contracts within the DoD?

Benchmarking the $90 million contract value against similar audit support contracts within the Department of Defense (DoD) requires access to a broader dataset of federal procurement. However, for a contract of this magnitude in management and administrative consulting, it represents a significant investment. The DoD often engages in large-scale support contracts due to its complex operations. Without specific details on the scope, duration of individual task orders, and the specific services rendered, a direct comparison is challenging. Generally, contracts in the tens of millions of dollars for specialized consulting services are not uncommon for major federal agencies. A more precise comparison would involve analyzing the average cost per year or per deliverable for similar audit infrastructure or management consulting services awarded by the DoD or other large federal entities over the past few fiscal years.

What are the key performance indicators (KPIs) used to measure the success of this contract?

The provided data does not specify the Key Performance Indicators (KPIs) for this contract. For a contract focused on 'Audit Infrastructure Support Services' under the 'Administrative Management and General Management Consulting Services' category, typical KPIs might include metrics related to the efficiency and effectiveness of audit processes, the timeliness of audit report generation, the reduction in audit findings or discrepancies, improvements in compliance rates, the successful implementation of new audit technologies or methodologies, and client satisfaction surveys from the supported DoD entities. The firm fixed-price nature suggests that performance outcomes are critical, and failure to meet agreed-upon standards could have financial implications or lead to contract modifications. Detailed performance work statements (PWS) within the contract would outline these specific KPIs.

What is Guidehouse Inc.'s track record with similar large-scale government contracts?

Guidehouse Inc. has a substantial track record of securing and performing on large-scale government contracts, particularly within the federal sector. They are known for providing a wide array of consulting services, including financial management, technology, risk, and compliance, often serving defense and civilian agencies. Their experience spans areas relevant to audit infrastructure, such as cybersecurity, data analytics, and process modernization. Analyzing their past performance on contracts of similar size and scope, particularly within the Department of Defense, would provide insight into their ability to deliver effectively and manage complex projects. Publicly available contract databases and agency performance reviews can offer further details on their historical success rates and client feedback.

What are the potential risks associated with a long-duration contract like this (ending in 2026)?

Long-duration contracts, such as this one ending in April 2026, present several potential risks. One primary risk is the potential for cost escalation if not managed tightly, despite the firm fixed-price structure, through scope creep or unforeseen changes. Another risk is the contractor potentially becoming complacent over time, leading to a decrease in service quality or innovation. Market conditions and technological advancements can also shift significantly over the contract's lifespan, potentially making the contracted services or solutions outdated by the end date. Furthermore, the agency's needs might evolve, requiring significant modifications or potentially making the contract less aligned with current priorities. Effective contract management, regular performance reviews, and proactive communication are crucial to mitigate these risks.

How does the 'Administrative Management and General Management Consulting Services' category influence the oversight and accountability for this contract?

The broad nature of 'Administrative Management and General Management Consulting Services' (NAICS 541611) necessitates robust oversight and accountability mechanisms. Because the services are less tangible than, for example, construction or IT hardware, success is often measured by the quality of advice, the effectiveness of implemented strategies, and the achievement of organizational improvements. This requires detailed performance work statements (PWS) that clearly define deliverables, milestones, and quality standards. Accountability is typically managed through regular progress reports, performance reviews, and potentially user satisfaction surveys. The agency must ensure that the contractor's activities directly contribute to the DoD's mission objectives and provide demonstrable value, rather than simply providing generic advice. Strong contract officers and technical monitors are essential for effective oversight in this service category.

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) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HQ003420R0224

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Peraton Technology Services Inc.

Address: 1676 INTERNATIONAL DR STE 800, MC LEAN, VA, 22102

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $91,292,414

Exercised Options: $91,292,414

Current Obligation: $89,800,797

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HQ003419A0017

IDV Type: BPA

Timeline