DHS awards $11.95M for SAP Consulting Services to SAP Public Services Inc

Contract Overview

Contract Amount: $11,951,649 ($12.0M)

Contractor: SAP Public Services Inc

Awarding Agency: Department of Homeland Security

Start Date: 2006-01-01

End Date: 2013-05-24

Contract Duration: 2,700 days

Daily Burn Rate: $4.4K/day

Number of Offers Received: 1

Pricing Type: LABOR HOURS

Sector: IT

Official Description: SAP CONSULTING SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20229

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $12.0 million to SAP PUBLIC SERVICES INC for work described as: SAP CONSULTING SERVICES Key points: 1. Contract awarded to a single vendor, raising questions about competition. 2. Significant contract value over 7 years suggests substantial service requirements. 3. Focus on SAP consulting indicates a need for specialized IT expertise. 4. The contract's duration and cost warrant scrutiny for value and efficiency.

Value Assessment

Rating: fair

The total award amount is $11.95 million over approximately 7.4 years. Without specific task orders or labor rates, a direct comparison to similar contracts is difficult. However, the overall value suggests a substantial investment in SAP services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded sole-source, meaning competition was not sought. This method can lead to higher prices and reduced innovation compared to full and open competition. The rationale for sole-source is not provided.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers due to the lack of competitive bidding and price discovery.

Public Impact

Citizens rely on Customs and Border Protection for effective border management, which may depend on robust SAP systems. Taxpayer funds are allocated to specialized IT services, impacting the federal IT budget. The long-term nature of the contract suggests ongoing reliance on these SAP services for critical agency functions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Long contract duration

Positive Signals

Specialized SAP expertise
Potential for system optimization

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on enterprise resource planning (ERP) software consulting. Federal spending on IT services, including ERP, is substantial, with agencies often relying on specialized vendors for complex systems like SAP.

Small Business Impact

There is no indication that small businesses were involved in this sole-source award. Sole-source contracts typically bypass the competitive bidding process where small business set-asides are often applied.

Oversight & Accountability

The sole-source nature of this award warrants careful oversight to ensure the services provided are necessary, cost-effective, and meet the agency's requirements. Accountability for performance and spending should be clearly defined.

Related Government Programs

Department of Homeland Security Contracting
U.S. Customs and Border Protection Programs

Risk Flags

Lack of competition
Potential for cost overruns
Sole-source award justification unclear
Long-term commitment without clear performance metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $12.0 million to SAP PUBLIC SERVICES INC. SAP CONSULTING SERVICES

Who is the contractor on this award?

The obligated recipient is SAP PUBLIC SERVICES INC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $12.0 million.

What is the period of performance?

Start: 2006-01-01. End: 2013-05-24.

What was the justification for awarding this contract sole-source, and were any alternatives considered?

The justification for a sole-source award is critical for understanding the procurement strategy. Agencies typically sole-source when only one vendor can meet the requirement due to unique capabilities, urgency, or specific circumstances. Without this justification, it's difficult to assess if competitive options were overlooked or if the sole-source approach was truly necessary and in the government's best interest.

How does the per-unit cost or labor rate for these SAP consulting services compare to industry benchmarks or other government contracts?

Benchmarking the cost of SAP consulting services is essential for determining value for money. Comparing labor rates or the cost of specific deliverables against market data or similar government contracts can reveal potential overpricing or cost efficiencies. Without this data, it's challenging to assess if the $11.95 million award represents a fair price for the services rendered over its duration.

What specific SAP modules or functionalities are being supported or implemented under this contract, and how critical are they to CBP's mission?

Understanding the specific SAP services procured is key to evaluating their impact and necessity. If these services support critical mission functions like border security, trade processing, or internal operations, the investment is justifiable. Conversely, if they support less critical functions, the significant expenditure might be questioned, highlighting the need for clear alignment between IT spending and agency priorities.

Contractor Details

Parent Company: SAP AG (UEI: 316268655)

Address: 1300 PENN AVE NW STE 500, WASHINGTON, DC, 98

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $11,951,649

Exercised Options: $11,951,649

Current Obligation: $11,951,649

Parent Contract

Parent Award PIID: GS35F5891H

IDV Type: FSS

Timeline