DoD's $100M Change Management Contract Awarded to Guidehouse Inc. for USTRANSCOM

Contract Overview

Contract Amount: $9,999,162 ($10.0M)

Contractor: Guidehouse Inc.

Awarding Agency: Department of Defense

Start Date: 2022-10-01

End Date: 2027-09-30

Contract Duration: 1,825 days

Daily Burn Rate: $5.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: CHANGE MANAGEMENT AND KNOWLEDGE MANAGEMENT SUPPORT SERVICES

Place of Performance

Location: SCOTT AFB, SAINT CLAIR County, ILLINOIS, 62225

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $10.0 million to GUIDEHOUSE INC. for work described as: CHANGE MANAGEMENT AND KNOWLEDGE MANAGEMENT SUPPORT SERVICES Key points: 1. Contract focuses on critical change and knowledge management support for USTRANSCOM. 2. Awarded via full and open competition, suggesting a competitive bidding process. 3. Firm Fixed Price contract type aims to control costs and provide predictable spending. 4. Long duration of 5 years indicates a significant, ongoing need for these services. 5. The contract value is substantial, reflecting the importance of the services provided. 6. NAICS code 541611 points to a focus on management consulting services.

Value Assessment

Rating: good

The contract value of $99,991,620 over five years for change and knowledge management support appears reasonable given the scope and duration. Benchmarking against similar large-scale consulting contracts for federal agencies suggests this price point is within expected ranges for comprehensive support. The firm fixed-price structure provides cost certainty for the government, which is a positive indicator of value.

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 were likely invited to submit proposals. The presence of 6 bids suggests a healthy level of competition for this significant contract. This competitive environment generally leads to better price discovery and potentially more innovative solutions for the government.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down costs and encouraging high-quality service delivery.

Public Impact

Benefits USTRANSCOM by enhancing its ability to manage organizational changes and knowledge effectively. Supports the modernization and efficiency of military transportation and logistics operations. Impacts the workforce through improved processes and potentially new knowledge-sharing tools. Services delivered are crucial for maintaining operational readiness and strategic adaptation within the DoD.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to vendor lock-in if not managed carefully.
Reliance on a single contractor for critical change management functions poses a risk.
Potential for scope creep if requirements are not clearly defined and managed.

Positive Signals

Firm Fixed Price contract type helps mitigate cost overrun risks.
Full and open competition suggests a robust selection process.
Award to an established firm like Guidehouse Inc. may indicate a track record of successful performance.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically management consulting. The federal government is a significant consumer of these services, particularly within large agencies like the Department of Defense, to manage complex operations, implement new technologies, and drive organizational efficiency. Comparable spending benchmarks for large-scale consulting engagements within the federal government often run into tens or hundreds of millions of dollars over multiple years.

Small Business Impact

The data indicates this contract was not set aside for small businesses, and there is no explicit mention of small business subcontracting requirements. This suggests that the primary award went to a large business, and opportunities for small businesses would likely be through subcontracting if mandated or pursued by the prime contractor. Further investigation into subcontracting plans would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

The firm fixed-price contract type provides a degree of financial oversight. The Department of Defense and USTRANSCOM have established procurement regulations and oversight mechanisms to monitor contract performance and ensure compliance. Transparency would be enhanced by public reporting on performance metrics and any modifications to the contract. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

DoD Management Consulting Services
USTRANSCOM Logistics Support Contracts
Federal Change Management Programs
Knowledge Management Support Services
Administrative and Management Consulting

Risk Flags

Potential for scope creep given the long duration and nature of consulting services.
Risk of contractor complacency or reduced innovation over a five-year period.
Need for clear performance metrics to ensure value for money is maintained.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.0 million to GUIDEHOUSE INC.. CHANGE MANAGEMENT AND KNOWLEDGE MANAGEMENT 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 (USTRANSCOM).

What is the total obligated amount?

The obligated amount is $10.0 million.

What is the period of performance?

Start: 2022-10-01. End: 2027-09-30.

What is Guidehouse Inc.'s track record with similar large-scale federal consulting contracts, particularly within the Department of Defense?

Guidehouse Inc. has a significant history of performing large-scale federal contracts, including substantial work within the Department of Defense and other civilian agencies. They specialize in areas such as management consulting, technology modernization, and financial management. Their portfolio often includes complex transformation initiatives, requiring expertise in change management and knowledge transfer. While specific details of past performance on contracts of identical scope and value to this USTRANSCOM award are not provided here, their general profile suggests they are well-positioned for such engagements. A deeper dive into their contract history, including past performance reviews and any reported issues, would be necessary for a comprehensive assessment.

How does the awarded value of approximately $100 million compare to other federal contracts for change and knowledge management support services?

The awarded value of approximately $100 million over five years for change and knowledge management support services is substantial, placing it among larger federal consulting contracts. However, within the broader landscape of federal IT modernization, defense logistics, and large-scale organizational transformation projects, this figure is not unprecedented. Many federal agencies, particularly DoD components like USTRANSCOM, engage contractors for multi-year support that can reach or exceed this value. Benchmarking against contracts with similar NAICS codes (e.g., 541611) and durations across agencies like GSA, HHS, or other military branches would provide a more precise comparison. The firm fixed-price nature of this contract also influences its comparability to cost-plus or time-and-materials contracts.

What are the primary risks associated with a five-year firm fixed-price contract for change and knowledge management services?

A significant risk with a five-year firm fixed-price contract for change and knowledge management services is the potential for the contractor to become complacent or for the government to face challenges if requirements evolve significantly beyond the initial scope. For the contractor, underestimating the effort required or facing unforeseen complexities could lead to reduced profit margins. For the government, the risk lies in the potential for the services to become outdated if the contract doesn't allow for sufficient adaptation to changing needs or technologies. Additionally, if the initial pricing was overly optimistic by the government, the fixed price might not reflect true market value over the full term. Ensuring robust performance metrics and change control processes are in place is crucial to mitigate these risks.

How effective are firm fixed-price contracts in ensuring value for money in consulting services compared to other contract types?

Firm fixed-price (FFP) contracts are generally considered effective in ensuring value for money when the scope of work is well-defined and unlikely to change significantly. They place the risk of cost overruns on the contractor, incentivizing efficiency and cost control. For consulting services like change and knowledge management, FFP can be advantageous if the objectives and deliverables are clearly articulated from the outset. However, if the nature of consulting requires flexibility and adaptation to evolving circumstances, an FFP contract might stifle innovation or lead to disputes over scope creep. In such cases, other contract types like Cost Plus Incentive Fee (CPIF) or Time and Materials (T&M) might offer better value by allowing for adjustments while maintaining oversight.

What historical spending patterns exist for administrative management and general management consulting services (NAICS 541611) within USTRANSCOM or the DoD?

Historical spending patterns for NAICS 541611 within USTRANSCOM and the broader DoD indicate a consistent and substantial reliance on management consulting services. These services are crucial for supporting complex logistical operations, implementing strategic initiatives, and managing organizational change. Annual spending in this category across the DoD often runs into the billions of dollars, reflecting the scale and complexity of military operations. USTRANSCOM, as a major component command responsible for global mobility, frequently procures services related to process improvement, system integration, and strategic planning. This specific $100 million award is a significant, but not anomalous, investment within that larger context of ongoing consulting expenditures.

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

Offers Received: 6

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: $12,409,855

Exercised Options: $9,999,162

Current Obligation: $9,999,162

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00F045DA

IDV Type: FSS

Timeline