Leidos Inc. awarded $237M for Army IT services, highlighting strong competition and long-term support
Contract Overview
Contract Amount: $237,131,226 ($237.1M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2018-04-26
End Date: 2023-10-24
Contract Duration: 2,007 days
Daily Burn Rate: $118.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: IGF::OT::IGF AIES NG - BASE SERVICES
Place of Performance
Location: VICKSBURG, WARREN County, MISSISSIPPI, 39180
Plain-Language Summary
Department of Defense obligated $237.1 million to LEIDOS, INC. for work described as: IGF::OT::IGF AIES NG - BASE SERVICES Key points: 1. The contract demonstrates a significant investment in IT modernization for the Department of the Army. 2. Full and open competition suggests a healthy market for these services, potentially leading to better pricing. 3. The duration of the contract (2018-2023) indicates a need for sustained IT support. 4. The fixed-price nature of the contract shifts performance risk to the contractor. 5. Computer Systems Design Services are critical for maintaining and upgrading complex defense IT infrastructure. 6. The award value is substantial, reflecting the scale and importance of the services provided.
Value Assessment
Rating: good
The contract value of $237 million over approximately five years for computer systems design services appears reasonable given the scope of support for a major military branch. Benchmarking against similar large-scale IT service contracts for defense agencies suggests that pricing is likely competitive due to the full and open competition. The firm fixed-price contract type also indicates a commitment to cost control, with the contractor bearing the risk of cost overruns.
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 considered. The presence of four bidders (no=4) suggests a robust competitive environment for this type of IT service. This level of competition is generally favorable for price discovery and ensures that the government receives proposals from a range of qualified vendors, potentially leading to more cost-effective solutions.
Taxpayer Impact: The full and open competition process is beneficial for taxpayers as it drives down prices through market forces and encourages innovation among bidders, ultimately leading to better value for public funds.
Public Impact
The Department of the Army benefits from enhanced and sustained IT systems and services. Military personnel and civilian employees receive reliable IT support, crucial for operational effectiveness. The contract supports advanced computer systems design, contributing to the modernization of defense infrastructure. The geographic impact is likely widespread, supporting Army operations across various installations. The contract supports a significant number of IT professionals, contributing to the federal IT workforce.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in if follow-on contracts are not competitively bid.
- Risk of scope creep if requirements are not clearly defined and managed.
- Dependence on a single contractor for critical IT infrastructure could pose a risk if performance degrades.
Positive Signals
- Awarded through full and open competition, indicating a competitive market.
- Firm fixed-price contract shifts cost risk to the contractor.
- Long-term contract duration suggests stability and sustained support for essential IT services.
- Contractor has a significant presence in federal IT services, implying experience.
Sector Analysis
This contract falls within the Computer Systems Design Services sector, a critical component of the broader Information Technology (IT) industry. This sector is characterized by high demand from government and commercial entities for expertise in designing, developing, and integrating complex IT solutions. The market size for federal IT services is substantial, with agencies continually investing in modernization, cybersecurity, and cloud migration. This specific contract likely supports the Army's strategic IT initiatives, aligning with broader trends in defense IT spending focused on enhancing operational capabilities and efficiency.
Small Business Impact
The data indicates this contract was not set aside for small businesses (ss=false, sb=false). While this specific award may not directly benefit small businesses through set-asides, large prime contractors like Leidos often engage small businesses as subcontractors. The extent of small business subcontracting would depend on the contractor's internal policies and the specific requirements of the contract, which are not detailed here. Further analysis would be needed to determine the impact on the small business ecosystem.
Oversight & Accountability
Oversight for this contract would typically be managed by the Department of the Army's contracting officers and program managers. The firm fixed-price nature provides a degree of financial oversight by limiting the government's liability to the agreed-upon price. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.
Related Government Programs
- Army IT Modernization Programs
- Defense Information Systems Agency (DISA) Contracts
- General Services Administration (GSA) IT Schedule Contracts
- Department of Defense Enterprise IT Services
Risk Flags
- Contract duration exceeds typical project timelines, indicating core service provision.
- High award value suggests critical IT infrastructure support.
- Firm Fixed Price contract type requires careful performance monitoring.
Tags
it, defense, department-of-defense, army, computer-systems-design-services, full-and-open-competition, firm-fixed-price, large-contract, enterprise-it, mississippi, leidos-inc
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $237.1 million to LEIDOS, INC.. IGF::OT::IGF AIES NG - BASE SERVICES
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $237.1 million.
What is the period of performance?
Start: 2018-04-26. End: 2023-10-24.
What is Leidos Inc.'s track record with similar large-scale IT service contracts for the Department of Defense?
Leidos Inc. is a major government contractor with extensive experience in providing IT services to the Department of Defense and other federal agencies. They have a history of managing large, complex contracts involving systems integration, cybersecurity, cloud computing, and enterprise IT support. Their track record includes numerous awards for similar services, often under competitive bidding processes. While specific performance metrics for past contracts are not detailed here, their continued success in securing significant awards suggests a generally positive performance history and strong capabilities in meeting defense IT requirements. However, a deeper dive into past performance reviews and any documented issues would provide a more comprehensive assessment.
How does the $237 million award compare to other similar computer systems design service contracts awarded by the Army in recent years?
The $237 million award for computer systems design services over approximately five years is a substantial contract, reflecting the scale of IT support required by the Department of the Army. When compared to other large-scale IT service contracts awarded by the Army, this value is within a typical range for enterprise-level support, modernization, and sustainment efforts. Agencies often award multi-year, high-value contracts for critical IT functions due to the complexity and ongoing nature of these services. The firm fixed-price structure and full and open competition further suggest that the pricing is likely benchmarked against market rates for similar services, indicating a potentially good value proposition for the government.
What are the primary risks associated with a firm fixed-price contract of this magnitude for IT services?
The primary risk associated with a firm fixed-price contract of this magnitude for IT services lies in the potential for the contractor to cut corners on quality or scope to maintain profitability if their cost estimates were too low or if unforeseen technical challenges arise. While the government is protected from cost overruns, it relies heavily on the contractor's ability to deliver the specified services within the agreed price. Risks include potential performance deficiencies, delays, or a lack of flexibility to adapt to evolving technological needs if not managed contractually. Robust oversight, clear performance metrics, and strong contract management are crucial to mitigate these risks and ensure the government receives the intended value and quality of services.
How does the 'Computer Systems Design Services' category (NAICS 541512) typically contribute to the operational effectiveness of the Department of the Army?
Computer Systems Design Services (NAICS 541512) are fundamental to the operational effectiveness of the Department of the Army by ensuring that its complex IT infrastructure is robust, secure, and capable of supporting mission-critical functions. This includes designing, developing, integrating, and maintaining the hardware, software, and network systems that enable communication, data processing, intelligence gathering, logistics, and command and control. Effective systems design ensures interoperability between different military branches and systems, supports the deployment of new technologies, and enhances cybersecurity defenses. Ultimately, well-designed and maintained IT systems are essential for maintaining situational awareness, enabling rapid decision-making, and ensuring the successful execution of military operations in diverse environments.
What does the duration of the contract (2018-2023) suggest about the Army's IT needs and the stability of this service requirement?
The contract duration of approximately five years (from April 26, 2018, to October 24, 2023) suggests that the Army has a long-term, stable requirement for the computer systems design services provided by Leidos, Inc. Such extended periods indicate that these services are not for short-term projects but are integral to the ongoing operations and sustainment of the Army's IT infrastructure. This stability allows for better planning, resource allocation, and the development of specialized expertise by the contractor. It also implies that the underlying IT needs are enduring, potentially related to core enterprise systems, ongoing modernization efforts, or essential support functions that require consistent attention and maintenance over several years.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design 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
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 700 N FREDERICK AVE, GAITHERSBURG, MD, 20879
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $295,390,116
Exercised Options: $243,949,786
Current Obligation: $237,131,226
Subaward Activity
Number of Subawards: 184
Total Subaward Amount: $64,375,890
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: GS00Q09BGD0039
IDV Type: GWAC
Timeline
Start Date: 2018-04-26
Current End Date: 2023-10-24
Potential End Date: 2023-10-24 00:00:00
Last Modified: 2025-01-27
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