DoD's $16.7M Highbond Subscription & Training contract awarded to FCN, Inc. shows strong competition

Contract Overview

Contract Amount: $16,737,815 ($16.7M)

Contractor: FCN, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-12-01

End Date: 2026-11-30

Contract Duration: 1,460 days

Daily Burn Rate: $11.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 9

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: HIGHBOND ENTERPRISE ANNUAL SUBSCRIPTION AND TRAINING

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10010

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $16.7 million to FCN, INC. for work described as: HIGHBOND ENTERPRISE ANNUAL SUBSCRIPTION AND TRAINING Key points: 1. The contract value of $16.7M over four years suggests a significant investment in enterprise software and training. 2. Awarded under full and open competition, this contract indicates a healthy market with multiple capable vendors. 3. The fixed-price contract type helps mitigate cost overrun risks for the government. 4. The duration of 1460 days (4 years) allows for sustained support and integration of the Highbond solution. 5. The North American Industry Classification System (NAICS) code 541519 points to a broad range of computer-related services. 6. The contract's focus on enterprise subscription and training highlights the importance of software adoption and user proficiency.

Value Assessment

Rating: good

The total contract value of $16.7M over four years averages approximately $4.18M annually. Benchmarking this against similar enterprise software subscriptions and training services is challenging without specific details on the software's scope and user base. However, the competitive award process suggests that the pricing achieved is likely reasonable within the market for such specialized services. The firm-fixed-price structure provides cost certainty.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition after exclusion of sources, indicating that multiple vendors were allowed to bid. With 9 bidders participating, the level of competition appears robust. This suggests that the government received a range of proposals and was able to select the best value offering, likely leading to more competitive pricing than a sole-source or limited competition scenario.

Taxpayer Impact: A high number of bidders ensures that taxpayer dollars are being used efficiently, as competition drives down prices and encourages vendors to offer their best terms.

Public Impact

The Department of Defense, specifically the Defense Finance and Accounting Service (DFAS), is the primary beneficiary, gaining access to enterprise software and training. The services delivered include annual subscriptions and training for the Highbond enterprise solution, crucial for financial management and operational efficiency. The contract's impact is likely concentrated within DFAS operations, potentially improving financial reporting, compliance, and audit readiness. Workforce implications include the need for personnel to be trained on the Highbond system, enhancing their capabilities in financial analysis and management.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if Highbond becomes deeply integrated and difficult to replace.
Reliance on a single vendor for critical enterprise software and training could pose a risk if the vendor experiences financial instability or changes strategic direction.
The effectiveness of the training provided will be crucial for realizing the full value of the software investment.

Positive Signals

The competitive award process suggests a good market assessment and selection of a capable vendor.
The firm-fixed-price contract type provides budget certainty and reduces the risk of cost overruns.
The long-term nature of the contract (4 years) allows for stable implementation and utilization of the Highbond solution.

Sector Analysis

The market for enterprise resource planning (ERP) and financial management software is substantial, with significant government spending in this area. Companies like Highbond offer solutions that integrate various financial processes, including planning, budgeting, forecasting, and compliance. The NAICS code 541519, 'Other Computer Related Services,' encompasses a wide array of IT services, including software implementation and support. This contract fits within the broader IT services sector, where the DoD is a major consumer, seeking to modernize its financial systems and improve operational efficiency.

Small Business Impact

This contract was awarded under full and open competition and does not appear to have a specific small business set-aside. While the prime contractor, FCN, Inc., may be a small business (information not provided), the nature of enterprise software subscriptions and training often involves large-scale solutions that may not be exclusively subcontracted to small businesses. Further analysis would be needed to determine if any subcontracting opportunities exist for small businesses within the scope of this award.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contracting and financial management oversight bodies, including the Defense Contract Management Agency (DCMA) and the Defense Contract Audit Agency (DCAA). The Defense Finance and Accounting Service (DFAS) would also be responsible for monitoring performance and ensuring compliance with contract terms. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

DoD Enterprise Software Licenses
Financial Management Systems Modernization
IT Services for Defense Agencies
Government Training and Development Programs
Cloud-Based Enterprise Solutions

Risk Flags

Potential for vendor lock-in
Effectiveness of training delivery
Software performance and reliability

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.7 million to FCN, INC.. HIGHBOND ENTERPRISE ANNUAL SUBSCRIPTION AND TRAINING

Who is the contractor on this award?

The obligated recipient is FCN, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Finance and Accounting Service).

What is the total obligated amount?

The obligated amount is $16.7 million.

What is the period of performance?

Start: 2022-12-01. End: 2026-11-30.

What is the track record of FCN, Inc. in delivering similar enterprise software and training services to the federal government?

FCN, Inc. has a history of federal contracting, primarily in IT services and solutions. While specific details on their experience with the Highbond platform are not immediately available from the provided data, their award on this significant contract suggests they possess the necessary capabilities and past performance to meet the DoD's requirements. A deeper dive into their contract history, including past performance evaluations and any awards related to financial management software or enterprise solutions, would provide a more comprehensive understanding of their track record. Examining their role in previous similar procurements could reveal their ability to manage complex software subscriptions and deliver effective training programs.

How does the annual cost of this Highbond subscription and training compare to similar enterprise software solutions used by other federal agencies?

The annual cost for this contract averages approximately $4.18M ($16.7M / 4 years). Comparing this directly to other federal agency spending on enterprise software requires access to detailed contract data for comparable solutions, including the specific modules licensed, the number of users, and the scope of training. However, enterprise-level financial management and planning software, especially those offering advanced analytics and compliance features like Highbond, can represent significant investments. Agencies often spend millions annually on such systems. The competitive nature of this award suggests the price is likely aligned with market rates for comparable, high-value enterprise solutions, but a precise benchmark would necessitate a detailed market analysis of similar contracts.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Key risks include potential vendor lock-in, where the DoD becomes heavily reliant on Highbond, making future transitions costly and complex. Another risk is the effectiveness of the training; if users are not adequately trained, the full benefits of the software may not be realized. Performance issues with the software or the vendor's support could also impact DFAS operations. Mitigation strategies likely include the firm-fixed-price contract type, which caps costs, and the competitive award process, which selects a vendor based on demonstrated capability. Contractual clauses regarding performance standards, service level agreements (SLAs), and potentially phased implementation with user feedback loops would also serve as mitigation measures.

How effective is the Highbond solution in meeting the DoD's financial management and compliance needs, based on past performance or industry benchmarks?

The effectiveness of the Highbond solution for the DoD's specific needs is not detailed in the provided award data. Highbond, by reputation and its product offerings, is designed to address complex financial processes, including risk management, compliance, and planning. Its suitability for the DoD would depend on how well its features align with the department's unique requirements, such as regulatory compliance (e.g., FISCAM), audit readiness, and integration with existing DoD financial systems. Industry benchmarks and case studies for Highbond in large, complex organizations, particularly in the public sector, would offer insights into its proven capabilities in areas like financial close automation, internal controls, and regulatory reporting.

What has been the historical spending pattern for similar enterprise software and training services by the Department of Defense?

The Department of Defense is a massive consumer of IT services and software, with historical spending in the billions of dollars annually across various categories, including enterprise resource planning (ERP), financial management systems, and related training. Spending on specific solutions like Highbond would be part of broader initiatives to modernize financial systems, enhance cybersecurity, and improve operational efficiency. Historical data would likely show consistent, significant investments in software licenses, subscriptions, implementation services, and ongoing training to support its vast and complex operations. Trends may indicate a shift towards cloud-based solutions and integrated platforms to streamline processes and improve data analytics.

Industry Classification

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

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HQ042322Q0042

Offers Received: 9

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 12501 ARDENNES AVE STE 101, ROCKVILLE, MD, 20852

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

Financial Breakdown

Contract Ceiling: $21,524,011

Exercised Options: $16,737,815

Current Obligation: $16,737,815

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: NNG15SC71B

IDV Type: GWAC

Timeline