Octo Consulting Group LLC awarded $35.9M follow-on for Seaport Portal, custom computer programming services

Contract Overview

Contract Amount: $35,940,114 ($35.9M)

Contractor: Octo Consulting Group LLC

Awarding Agency: Department of Defense

Start Date: 2014-09-30

End Date: 2020-09-28

Contract Duration: 2,190 days

Daily Burn Rate: $16.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: AWARD OF FOLLOW-ON FOR SEAPORT PORTAL CONTRACT

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20191

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $35.9 million to OCTO CONSULTING GROUP LLC for work described as: AWARD OF FOLLOW-ON FOR SEAPORT PORTAL CONTRACT Key points: 1. Contract awarded for custom computer programming services, indicating a need for specialized software development. 2. The contract is a follow-on, suggesting prior successful performance or established relationship. 3. The award value of $35.9M over approximately 6 years points to a significant investment in IT infrastructure. 4. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 5. The North American Industry Classification System (NAICS) code 541511 aligns with custom software development. 6. The contract was not competed, raising questions about potential cost efficiencies and market exploration.

Value Assessment

Rating: fair

The contract value of $35.9M over 6 years averages to approximately $6M annually. Without specific benchmarks for similar custom programming services within the Department of Defense, it is difficult to definitively assess value for money. The Firm Fixed Price contract type provides cost certainty for the government, but the lack of competition may have led to a higher price than could have been achieved through a competitive process. Further analysis would require comparison to industry standards for similar custom development projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. The rationale for not competing is not provided in the data. Sole-source awards can occur for various reasons, including the unique capabilities of a single contractor, urgent needs, or if the contract is a follow-on to a previously competed effort where only one contractor can fulfill the requirements. The lack of competition limits the government's ability to leverage market forces to secure the best possible pricing and terms.

Taxpayer Impact: The absence of competition means taxpayers may not have benefited from the cost savings that typically arise from a competitive bidding process. This could result in a higher overall expenditure for the services provided.

Public Impact

The Department of Defense benefits from the development and maintenance of the Seaport Portal, likely enhancing its IT capabilities. Custom computer programming services are delivered, which could include software development, integration, and maintenance. The geographic impact is primarily within Virginia, where the contractor is located and likely where the services are performed or managed. The contract supports the IT workforce, potentially creating or sustaining jobs in custom software development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices and reduced innovation.
Follow-on nature of the contract without re-competition raises concerns about long-term cost-effectiveness.
Reliance on a single contractor for critical IT services could pose a risk if performance issues arise.

Positive Signals

Firm Fixed Price contract shifts cost risk to the contractor.
The contract is a follow-on, suggesting a degree of proven performance or familiarity with the requirements.
The contractor, Octo Consulting Group LLC, is established in the federal IT contracting space.

Sector Analysis

This contract falls within the IT services sector, specifically custom computer programming. The market for federal IT services is substantial, with agencies increasingly relying on technology for operations and mission support. Comparable spending benchmarks for custom software development can vary widely based on complexity, duration, and required expertise. However, the sustained award value suggests a significant and ongoing need for these specialized services within the Department of Defense.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false) and the contractor is not a small business (sb: false). Therefore, there are no direct subcontracting implications for small businesses arising from a small business set-aside. The absence of a small business set-aside means that opportunities for small businesses to participate in this specific contract are limited unless they are part of a larger subcontracting plan not detailed here.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Defense's contracting officers and the Defense Contract Management Agency (DCMA), as indicated by the 'sa' field. Accountability measures are inherent in the Firm Fixed Price contract type, which obligates the contractor to deliver specified services within the agreed-upon price. Transparency is limited by the sole-source nature of the award; further details on oversight and performance would likely reside within internal agency reporting mechanisms.

Related Government Programs

Seaport NxG Program
Department of Defense IT Modernization Initiatives
Custom Software Development Services
Federal IT Services Contracts

Risk Flags

Sole-source award lacks competitive pricing.
Potential for cost overruns due to lack of competition over a long duration.
Risk of vendor lock-in and reduced innovation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $35.9 million to OCTO CONSULTING GROUP LLC. AWARD OF FOLLOW-ON FOR SEAPORT PORTAL CONTRACT

Who is the contractor on this award?

The obligated recipient is OCTO CONSULTING GROUP LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $35.9 million.

What is the period of performance?

Start: 2014-09-30. End: 2020-09-28.

What is the specific nature of the 'Seaport Portal' and its function within the Department of Defense?

The 'Seaport Portal' is not explicitly defined in the provided data, but given the NAICS code (541511 - Custom Computer Programming Services) and the awarding agency (Department of Defense), it is highly probable that the Seaport Portal is a custom-built software application or platform designed to facilitate specific operations, data management, or communication within the DoD. This could range from a system for managing maritime contracts (given the 'Seaport' name, which often relates to naval or maritime operations) to an internal portal for personnel, logistics, or information sharing. The 'follow-on' nature suggests it is an existing system that requires continued development, maintenance, or enhancement.

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. However, for custom computer programming services, typical KPIs often include metrics related to software functionality, performance (e.g., speed, uptime), security, adherence to project timelines, bug resolution rates, and user satisfaction. Given the Firm Fixed Price nature, meeting the defined scope of work and technical specifications within budget and schedule would be paramount. The Department of Defense would likely have internal performance management frameworks to track these aspects, even if not explicitly detailed in the award abstract.

How does the annual cost of this contract compare to industry benchmarks for similar custom programming services?

The contract's total value is $35,940,113.51 over approximately 2190 days (6 years), averaging roughly $16,411 per day or approximately $6 million annually. Benchmarking this against industry standards for custom computer programming services is challenging without more specific details on the complexity, scope, and technologies involved. However, the average annual cost suggests a significant project. Industry rates for custom software development can range widely, from tens to hundreds of dollars per hour per developer, depending on skill set, location, and project demands. A comprehensive benchmark would require detailed analysis of the specific services rendered.

What was the justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT COMPETED' (ct: NOT COMPETED), which signifies a sole-source or limited competition award. The specific justification for this sole-source award is not detailed in the abstract. Common reasons for sole-source awards include situations where only one responsible source can provide the required supplies or services, an urgent and compelling need exists, or the contract is a follow-on to a previously competed effort where only one contractor possesses the necessary knowledge or capabilities. Without further documentation, the precise rationale remains unknown.

What is Octo Consulting Group LLC's track record with the Department of Defense and similar contracts?

Octo Consulting Group LLC has a history of contracting with the Department of Defense, as evidenced by this award and its 'follow-on' nature. While the abstract doesn't provide a full performance history, the fact that this is a follow-on contract suggests a degree of satisfaction or established capability with the DoD. Companies like Octo typically engage in various IT services, including software development, cloud solutions, cybersecurity, and data analytics for federal agencies. A deeper dive into contract databases and performance reviews would offer a more comprehensive understanding of their track record and past performance ratings with the DoD.

Are there any potential risks associated with the long duration (6 years) and sole-source nature of this contract?

Yes, there are potential risks associated with a long-duration, sole-source contract. The primary risk of a sole-source award is the potential for higher costs due to the lack of competitive pressure, which can lead to reduced price efficiency for the government. A long duration (6 years) increases this risk over time. Additionally, relying on a single contractor for an extended period can lead to vendor lock-in, reduced flexibility to adopt new technologies or approaches, and potential complacency from the contractor regarding performance and innovation. If the contractor's performance falters or their capabilities become outdated, the government may face challenges in transitioning to a new provider.

Industry Classification

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

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0002414R6500

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Octo Consulting Group LLC (UEI: 117419678)

Address: 1600 INTERNATIONAL DR 5TH FL, MCLEAN, VA, 22102

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $35,949,900

Exercised Options: $35,949,900

Current Obligation: $35,940,114

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline