State Department's $46M IT support contract awarded to Accenture Federal Services shows fair value with limited competition

Contract Overview

Contract Amount: $45,943,726 ($45.9M)

Contractor: Accenture Federal Services LLC

Awarding Agency: Department of State

Start Date: 2011-04-12

End Date: 2016-09-25

Contract Duration: 1,993 days

Daily Burn Rate: $23.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: ILMS PROGRAM MANAGEMENT, O&M, CUSTOMER SERVICE DESK, NEW TECH INITIATIVES, AND RELEASE MANAGEMENT SUPPORT PERSONNEL.

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22209

State: Virginia Government Spending

Plain-Language Summary

Department of State obligated $45.9 million to ACCENTURE FEDERAL SERVICES LLC for work described as: ILMS PROGRAM MANAGEMENT, O&M, CUSTOMER SERVICE DESK, NEW TECH INITIATIVES, AND RELEASE MANAGEMENT SUPPORT PERSONNEL. Key points: 1. The contract provided essential IT support, including help desk services and new technology initiatives, contributing to the agency's operational efficiency. 2. While the contract was competed, the exclusion of sources suggests a potentially limited competitive landscape, which could impact price discovery. 3. The firm-fixed-price contract type generally shifts risk to the contractor, which can be beneficial for the government. 4. Accenture Federal Services, a large and experienced contractor, was well-positioned to deliver the required IT services. 5. The contract's duration and scope indicate a significant investment in maintaining and improving the State Department's IT infrastructure. 6. Performance was rated as 'Satisfactory' (ST), suggesting the contractor met the basic requirements but may not have exceeded expectations.

Value Assessment

Rating: fair

The contract's total value of approximately $46 million over its period of performance (2011-2016) appears reasonable for comprehensive IT support services. Benchmarking against similar large-scale IT support contracts for federal agencies suggests that the pricing was within an expected range, especially considering the scope of services including help desk, new technology, and release management. The firm-fixed-price structure further supports value by ensuring cost certainty for the government. However, the limited competition aspect warrants a closer look at whether the pricing truly reflects the most competitive market rates achievable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This indicates that while the initial solicitation was open, certain sources were excluded before the final award. The exact reasons for exclusion are not detailed, but this approach typically results in fewer bidders than a truly open competition. With only one awardee (Accenture Federal Services), it suggests a concentrated competitive environment, potentially limiting the government's ability to leverage a broader range of offers and drive down prices through intense bidding.

Taxpayer Impact: The limited competition may have resulted in the government paying a premium compared to what might have been achieved in a fully open and unrestricted bidding process. Taxpayers may not have benefited from the most aggressive pricing strategies that a larger pool of bidders could have offered.

Public Impact

The primary beneficiaries of this contract were the employees and operations of the Department of State, who relied on stable and efficient IT systems. Services delivered included crucial help desk support, ensuring users could resolve technical issues promptly. The contract also supported new technology initiatives, aiming to modernize the department's technological capabilities. Release management support ensured that software updates and system changes were implemented smoothly, minimizing disruption. The geographic impact was primarily within the Department of State's domestic and potentially international facilities where its IT infrastructure is deployed. Workforce implications include the support provided to IT personnel managing the systems and the end-users relying on them.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition could lead to higher costs for taxpayers.
The 'exclusion of sources' clause requires further investigation to ensure fairness and prevent potential favoritism.
Reliance on a single contractor for critical IT functions poses a potential risk if performance degrades or the contractor faces issues.

Positive Signals

Firm-fixed-price contract type shifts cost risk to the contractor.
Accenture Federal Services is a large, established contractor with significant experience in government IT services.
The contract provided essential IT support, contributing to the operational continuity of the Department of State.

Sector Analysis

This contract falls within the Information Technology (IT) services sector, specifically focusing on IT support, maintenance, and modernization. The market for federal IT services is vast and highly competitive, with numerous large and small businesses vying for government contracts. This particular contract, valued at approximately $46 million, represents a mid-to-large-sized engagement within the broader IT services landscape. Comparable spending benchmarks for similar IT support and management contracts across federal agencies often range from tens to hundreds of millions of dollars, depending on the scope and duration.

Small Business Impact

This contract was not set aside for small businesses, and the data indicates no subcontracting goals were specified or met. The awardee, Accenture Federal Services, is a large business. This means the contract did not directly contribute to the government's small business contracting goals. There is no indication of subcontracting opportunities for small businesses under this specific award, thus having a neutral impact on the small business IT ecosystem for this particular contract.

Oversight & Accountability

The contract was managed by the Department of State, which has its own internal oversight mechanisms for IT procurements and service delivery. Performance was rated as 'Satisfactory' (ST), indicating that the agency monitored contractor performance against contract requirements. The firm-fixed-price nature of the contract provides a degree of financial oversight by locking in costs. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available. Specific details on day-to-day oversight or IG involvement are not provided in the data.

Related Government Programs

Department of State IT Modernization Programs
Federal Civilian Agency IT Support Services
IT Help Desk and Customer Support Contracts
IT Infrastructure Management Contracts
New Technology Integration Services

Risk Flags

Limited Competition
Potential for higher costs due to limited bidding
Performance rated as 'Satisfactory', not 'Exceptional'

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $45.9 million to ACCENTURE FEDERAL SERVICES LLC. ILMS PROGRAM MANAGEMENT, O&M, CUSTOMER SERVICE DESK, NEW TECH INITIATIVES, AND RELEASE MANAGEMENT SUPPORT PERSONNEL.

Who is the contractor on this award?

The obligated recipient is ACCENTURE FEDERAL SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $45.9 million.

What is the period of performance?

Start: 2011-04-12. End: 2016-09-25.

What was the specific justification for excluding certain sources in this 'Full and Open Competition After Exclusion of Sources' award?

The provided data does not specify the exact justification for excluding certain sources under this contract. Typically, 'exclusion of sources' might be employed when specific capabilities, past performance, or security clearances are required that only a limited number of vendors possess, or in situations where prior contract performance by certain entities was unsatisfactory. Without further documentation from the Department of State, the precise reasons remain unclear. This lack of transparency can raise questions about whether the exclusion was truly necessary for mission success or if it inadvertently limited competition, potentially impacting the final price and value for taxpayers.

How does the performance rating of 'Satisfactory' (ST) compare to typical IT support contracts of this scale?

A 'Satisfactory' performance rating indicates that the contractor met the minimum requirements of the contract but did not necessarily exceed expectations. For a contract of this scale ($46M) providing critical IT support, 'Satisfactory' is often considered the baseline expectation. While not a negative rating, it suggests there may not have been exceptional performance that would warrant significant praise or bonuses. Agencies often aim for 'Exceptional' performance, especially on long-term, high-value contracts. A 'Satisfactory' rating suggests the services were adequate, but perhaps lacked proactive innovation or superior responsiveness that could have further enhanced the Department of State's IT operations and user satisfaction.

What is the track record of Accenture Federal Services in delivering similar IT support services to the federal government?

Accenture Federal Services (AFS) has a substantial track record of delivering a wide range of IT services to various federal agencies, including IT support, system integration, cloud migration, and cybersecurity. They are a major player in the federal IT contracting space, often handling large, complex programs. Their history includes numerous contracts similar in scope and nature to this Department of State award. While specific performance details vary by contract, AFS generally possesses the resources, expertise, and experience necessary for such engagements. However, like any large contractor, they have likely experienced both highly successful and less-than-optimal contract performances across their extensive portfolio.

Can the value of this contract be benchmarked against other similar IT support contracts awarded around the same period (2011-2016)?

Benchmarking this $46 million contract against similar IT support contracts awarded between 2011 and 2016 requires access to detailed contract data, including scope of work, service level agreements, and specific deliverables. However, general market analysis indicates that IT support contracts for large federal agencies during that period could range significantly. Contracts focusing solely on help desk support might be lower, while those encompassing broader system modernization, network management, and cybersecurity services could easily reach or exceed this value. The 'Other Computer Related Services' NAICS code (541519) is broad, but the description points to comprehensive support. Given the firm-fixed-price nature and the duration, the $46M figure appears within a plausible range for the described services, though the limited competition aspect warrants caution in definitive value assessment.

What are the potential risks associated with a firm-fixed-price contract for complex IT support services?

While firm-fixed-price (FFP) contracts are generally favored for cost certainty, they can introduce risks, especially for complex IT support services. If the scope of work is not precisely defined or if unforeseen technical challenges arise, the contractor may incur significant cost overruns, potentially leading to pressure to cut corners on quality or service. Conversely, if the contractor is highly efficient and the initial estimates were generous, they could realize substantial profit. For the government, the primary risk with FFP is that the contractor might be less incentivized to proactively identify efficiencies or suggest cost-saving innovations compared to other contract types like cost-plus, as their profit is fixed. Ensuring a well-defined SOW and robust oversight is crucial to mitigate these risks.

How did the 'BPA Call' contract vehicle impact the procurement process and potential competition?

A 'BPA Call' indicates that this contract was awarded under a Blanket Purchase Agreement (BPA). BPAs are simplified acquisition methods used to streamline purchasing from pre-approved vendors. A 'call' against a BPA means a specific order was placed under an existing BPA. This method generally leads to faster procurement but can limit competition if the underlying BPA itself was not widely competed or if the call is issued to only one vendor under the BPA. In this case, it was a 'BPA Call' under a 'Full and Open Competition After Exclusion of Sources' award, suggesting the BPA might have been established through broader competition, but this specific call had limited sourcing. This can reduce administrative burden but may not always yield the most competitive pricing compared to a standalone, fully competed contract.

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: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Accenture Public Limited Company

Address: 11951 FREEDOM DR STE 1000, RESTON, VA, 20190

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $45,943,726

Exercised Options: $45,943,726

Current Obligation: $45,943,726

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $9,792,348

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SAQMMA09A0173

IDV Type: BPA

Timeline