DHS awards $21.5M for CRM customization, raising concerns over limited competition and value
Contract Overview
Contract Amount: $21,527,605 ($21.5M)
Contractor: Microsoft Corporation
Awarding Agency: Department of Homeland Security
Start Date: 2011-09-28
End Date: 2018-06-22
Contract Duration: 2,459 days
Daily Burn Rate: $8.8K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: CUSTOMIZATION OF CRM
Place of Performance
Location: RESTON, FAIRFAX County, VIRGINIA, 20190
State: Virginia Government Spending
Plain-Language Summary
Department of Homeland Security obligated $21.5 million to MICROSOFT CORPORATION for work described as: CUSTOMIZATION OF CRM Key points: 1. Significant contract value ($21.5M) for IT services. 2. Sole-source award to Microsoft Corporation limits competitive pricing. 3. Long contract duration (2011-2018) may indicate evolving needs or lack of agile procurement. 4. IT sector spending benchmark for similar services needs further analysis.
Value Assessment
Rating: questionable
The contract value of $21.5M for 'Other Computer Related Services' is substantial. Without a competitive bidding process, it's difficult to assess if this price represents fair market value compared to similar CRM customization contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis to Microsoft Corporation. This lack of competition significantly hinders price discovery and may lead to inflated costs for the government.
Taxpayer Impact: The sole-source nature of this award means taxpayers may not have received the best possible price for the services rendered.
Public Impact
Citizenship and Immigration Services relies on this customized CRM for critical operations. Potential for cost overruns due to lack of competition impacts taxpayer funds. Long-term reliance on a single vendor could create vendor lock-in.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
- No small business participation
Positive Signals
- Firm Fixed Price contract type
- Delivery Order awarded
Sector Analysis
This contract falls within the IT services sector, specifically 'Other Computer Related Services'. Benchmarking against similar CRM customization projects is crucial to determine if the $21.5M award is competitive.
Small Business Impact
The data indicates no small business participation in this contract. Given the significant value, opportunities for small businesses to contribute to CRM customization or related services were missed.
Oversight & Accountability
The sole-source award and long duration warrant further oversight to ensure the government received adequate value and that the CRM customization met USCIS's evolving needs effectively.
Related Government Programs
- Other Computer Related Services
- Department of Homeland Security Contracting
- U.S. Citizenship and Immigration Services Programs
Risk Flags
- Sole-source award limits competition.
- Potential for overpricing due to lack of competition.
- No small business participation.
- Long contract duration may indicate inefficiencies.
- Lack of transparency in pricing discovery.
Tags
other-computer-related-services, department-of-homeland-security, va, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Homeland Security awarded $21.5 million to MICROSOFT CORPORATION. CUSTOMIZATION OF CRM
Who is the contractor on this award?
The obligated recipient is MICROSOFT CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Homeland Security (U.S. Citizenship and Immigration Services).
What is the total obligated amount?
The obligated amount is $21.5 million.
What is the period of performance?
Start: 2011-09-28. End: 2018-06-22.
What specific factors justified the sole-source award to Microsoft Corporation for CRM customization, and were alternatives thoroughly explored?
The justification for a sole-source award typically involves unique capabilities or proprietary technology. For this CRM customization, it's essential to understand if Microsoft's platform offered unparalleled advantages or if the government's requirements were so specific that only Microsoft could meet them. A thorough review would confirm if other vendors were considered and why they were deemed unsuitable, ensuring the government didn't forgo competitive pricing unnecessarily.
How did the lack of competition impact the final price paid for the CRM customization compared to market rates for similar services?
Without competitive bids, it's challenging to establish a precise market rate comparison. However, sole-source contracts often carry a premium because the vendor faces no pressure to offer the lowest possible price. Analysis of the delivered services against industry benchmarks for CRM customization, considering the vendor's pricing structure and the contract's duration, could reveal potential cost inefficiencies borne by taxpayers.
What was the effectiveness of the customized CRM in meeting USCIS's operational needs throughout the contract period, and were there any performance issues?
Assessing the effectiveness requires reviewing performance metrics, user feedback, and any documented issues or successes related to the CRM's functionality. Given the long contract duration (2011-2018), it's important to understand if the customization remained relevant and efficient as USCIS's needs evolved. Any performance gaps or unmet requirements would further impact the overall value assessment of this sole-source award.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: HSSCCG-11-R-00033
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: ONE MICROSOFT WAY, REDMOND, WA, 98052
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $22,597,677
Exercised Options: $21,527,605
Current Obligation: $21,527,605
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HSBP1009D02335
IDV Type: IDC
Timeline
Start Date: 2011-09-28
Current End Date: 2018-06-22
Potential End Date: 2018-06-22 00:00:00
Last Modified: 2018-05-23
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