Treasury's $32.2M contract for CADE2 database support awarded to Accenture LLP shows potential for agile response to data strategy demands

Contract Overview

Contract Amount: $32,183,416 ($32.2M)

Contractor: Accenture LLP

Awarding Agency: Department of the Treasury

Start Date: 2017-08-29

End Date: 2020-12-20

Contract Duration: 1,209 days

Daily Burn Rate: $26.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::OT::IGF FOR OTHER FUNCTIONS - AS THE OVERALL DATA STRATEGY IS IMPLEMENTED, ITS IMPACT TO THE CADE2 DATABASE SOLUTION AND SUPPORTING APPLICATION DEVELOPMENT ACTIVITIES MUST BE ASSESSED. THE DEVELOPMENT ORGANIZATIONS RESPONSIBLE FOR IMPLEMENTATION MUST BE POSITIONED TO RESPOND SWIFTLY AND AGILELY TO THE DEMANDS OF THE DATA STRATEGY, NEW AND CHANGING BUSINESS REQUIREMENTS, AND THE CADE2 PROGRAM IMPLEMENTATION SCHEDULE. ADDITIONALLY, THE BUSINESS AND TECHNOLOGY CHANGES IMPLEMENTED WITH CADE2 TS1 REQUIRE THE DEVELOPMENT ORGANIZATION TO RESPOND QUICKLY WHEN APPLICATION ISSUES OR DEFECTS ARE IDENTIFIED DURING PRODUCTION RUNS, NECESSITATING NEW METHODS OF TESTING AND DEPLOYMENT.

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22203

State: Virginia Government Spending

Plain-Language Summary

Department of the Treasury obligated $32.2 million to ACCENTURE LLP for work described as: IGF::OT::IGF FOR OTHER FUNCTIONS - AS THE OVERALL DATA STRATEGY IS IMPLEMENTED, ITS IMPACT TO THE CADE2 DATABASE SOLUTION AND SUPPORTING APPLICATION DEVELOPMENT ACTIVITIES MUST BE ASSESSED. THE DEVELOPMENT ORGANIZATIONS RESPONSIBLE FOR IMPLEMENTATION MUST BE POSITIONED TO RESPOND… Key points: 1. Contract supports the implementation of an overall data strategy impacting the CADE2 database solution and application development. 2. Focus on agile response to new business requirements and the CADE2 program schedule is a key performance indicator. 3. Requires swift response to application issues and defects identified during production runs, necessitating new testing and deployment methods. 4. The contract's duration and fixed-price nature suggest a defined scope for these IT services. 5. Accenture LLP, a large IT services provider, is the sole awardee, indicating a potentially significant role in Treasury's IT infrastructure. 6. The contract falls under 'Other Computer Related Services', a broad category within IT consulting.

Value Assessment

Rating: good

The contract value of $32.2 million over approximately three years appears reasonable for comprehensive IT support services related to a major database solution like CADE2. Benchmarking against similar large-scale IT development and support contracts within federal agencies suggests this is within a typical range, considering the complexity and criticality of data strategy implementation. The fixed-price contract type provides cost certainty for the government, assuming the scope of work is well-defined and managed effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of two bids suggests a competitive process, though the specific details of the bidding landscape (e.g., qualifications of the non-selected bidder) are not provided. A full and open competition generally leads to better price discovery and selection of the most capable vendor.

Taxpayer Impact: A full and open competition is favorable for taxpayers as it increases the likelihood of obtaining the best value and competitive pricing for essential IT services.

Public Impact

The primary beneficiaries are the Department of the Treasury and the Internal Revenue Service (IRS), who rely on the CADE2 database for critical data management and application development. Services delivered include supporting the implementation of the overall data strategy, application development, and ensuring agile responses to changing business requirements. The contract has a geographic impact primarily within Virginia, where the contractor is located, and supports federal operations nationwide. Workforce implications include the potential for specialized IT roles within Accenture to support this contract, contributing to the federal IT workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in given the critical nature of CADE2 database support.
Dependence on a single contractor for essential IT infrastructure could pose risks if performance degrades.
The broad scope of 'Other Computer Related Services' might lead to scope creep if not tightly managed.

Positive Signals

Awarded through full and open competition, suggesting a competitive selection process.
Fixed-price contract type provides cost predictability for the government.
Contract duration of approximately three years allows for sustained support and development.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on computer-related services and database support. The federal IT services market is substantial, with agencies consistently investing in modernizing systems, implementing data strategies, and ensuring robust application development. Contracts like this are crucial for agencies to maintain and enhance their technological capabilities, often involving complex systems integration and ongoing support. Comparable spending benchmarks would typically involve other large-scale IT modernization or database management contracts awarded to major IT service providers.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Accenture LLP is a large, well-established IT services provider. There is no explicit information on subcontracting plans for small businesses within this data snippet. Therefore, the direct impact on the small business ecosystem is likely minimal unless specific subcontracting requirements were mandated and fulfilled outside the provided data.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Treasury's contracting officers and program managers. The Inspector General for Tax Administration (TIGTA) may also have jurisdiction for audits and investigations related to IRS IT spending. Transparency is facilitated through contract databases like FPDS, where basic award information is publicly available. Accountability measures are inherent in the contract terms, performance metrics, and payment schedules.

Related Government Programs

CADE2 Program
IRS IT Modernization Efforts
Federal Data Strategy Implementation
Large-Scale Database Management Contracts
IT Application Development Services

Risk Flags

Potential for vendor lock-in
Reliance on a single contractor for critical IT infrastructure
Scope creep risk
Performance degradation risk

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $32.2 million to ACCENTURE LLP. IGF::OT::IGF FOR OTHER FUNCTIONS - AS THE OVERALL DATA STRATEGY IS IMPLEMENTED, ITS IMPACT TO THE CADE2 DATABASE SOLUTION AND SUPPORTING APPLICATION DEVELOPMENT ACTIVITIES MUST BE ASSESSED. THE DEVELOPMENT ORGANIZATIONS RESPONSIBLE FOR IMPLEMENTATION MUST BE POSITIONED TO RESPOND SWIFTLY AND AGILELY TO THE DEMANDS OF THE DATA STRATEGY, NEW AND CHANGING BUSINESS REQUIREMENTS, AND THE CADE2 PROGRAM IMPLEMENTATION SCHEDULE. ADDITIONALLY, THE BUSINESS AND TECHNOLOGY CHANGES IMPLEMENTED WITH CADE2 T

Who is the contractor on this award?

The obligated recipient is ACCENTURE LLP.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $32.2 million.

What is the period of performance?

Start: 2017-08-29. End: 2020-12-20.

What is Accenture LLP's track record with similar large-scale federal IT contracts, particularly those involving database solutions and data strategy implementation?

Accenture LLP is a global IT services and consulting firm with extensive experience in managing large, complex federal IT contracts. They have a history of working with various government agencies, including the Department of the Treasury and the IRS, on initiatives related to system modernization, data management, and application development. Their track record often involves large, multi-year contracts with significant dollar values. Specific to database solutions and data strategy, Accenture has been involved in projects aimed at improving data governance, implementing enterprise data warehouses, and supporting digital transformation efforts across government. While this specific contract focuses on CADE2, Accenture's broader portfolio suggests they possess the capabilities and experience to handle such critical IT infrastructure support.

How does the $32.2 million contract value compare to similar IT support contracts for major federal database systems?

The $32.2 million contract value for approximately three years of support for the CADE2 database solution and related application development appears to be within a reasonable range for large-scale federal IT services. Similar contracts for managing and developing critical government database systems, especially those involving complex data strategies and requiring agile responses, often range from tens to hundreds of millions of dollars over their lifecycle. Factors influencing cost include the criticality of the system, the scope of development and maintenance, the number of users, and the required security protocols. Given that CADE2 is a significant system for the IRS, this investment level is consistent with the ongoing need for robust IT support in such environments.

What are the primary risks associated with this contract, and what mitigation strategies are likely in place?

Key risks include potential vendor lock-in due to the specialized nature of CADE2 support, performance degradation by the contractor, and scope creep if requirements are not tightly managed. A significant risk is the reliance on a single vendor for critical database operations. Mitigation strategies likely include robust performance monitoring, clearly defined Service Level Agreements (SLAs), regular contract reviews, and contingency planning for potential contractor failure or transition. The fixed-price nature of the contract also helps mitigate cost overrun risks for the government, provided the scope is well-defined and managed.

How effective is the 'full and open competition' approach in ensuring value for money for this type of IT service?

The 'full and open competition' approach is generally considered the most effective method for ensuring value for money in federal contracting, especially for complex IT services. It allows a wide range of qualified vendors to compete, driving down prices and encouraging innovation. For this contract, having two bidders suggests a competitive process was initiated. The effectiveness in achieving optimal value depends on the clarity of the solicitation, the evaluation criteria, and the capabilities of the bidders. While competition is a strong indicator of potential value, ongoing performance monitoring is crucial to ensure the awarded vendor continues to deliver at a competitive price point throughout the contract's life.

What are the historical spending patterns for similar IT database support services at the IRS or Treasury?

Historical spending patterns for IT database support services at the IRS and Treasury are typically substantial, reflecting the critical role of data in tax administration and financial management. Agencies like the IRS invest heavily in maintaining and modernizing their core systems, which include large, complex databases. Spending often involves multi-year contracts for system development, maintenance, and support, frequently awarded to large IT service providers. These patterns show a consistent need for IT modernization, data analytics capabilities, and agile development to adapt to evolving regulatory and business requirements. The scale of spending can fluctuate based on major system overhauls or new strategic initiatives, such as the data strategy mentioned in this contract.

What are the implications of the 'Other Computer Related Services' NAICS code for the scope and nature of the work performed?

The North American Industry Classification System (NAICS) code 541519, 'Other Computer Related Services,' is a broad category that encompasses a wide range of IT services not specified elsewhere. This includes services like computer facilities management, IT support, data processing, disaster recovery services, and IT consulting. For this contract, it suggests the work performed by Accenture LLP is comprehensive and may involve a mix of application development, database administration, system integration, and ongoing IT support for the CADE2 solution. The broadness of the code implies flexibility in the services provided but also necessitates clear definition of deliverables and performance standards within the contract to ensure the government receives the intended services.

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

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: RTCP 4328

Offers Received: 2

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, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $158,929,058

Exercised Options: $104,506,087

Current Obligation: $32,183,416

Actual Outlays: $16,137,893

Subaward Activity

Number of Subawards: 20

Total Subaward Amount: $6,349,072

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: TIRNO11D00007

IDV Type: IDC

Timeline