Massive DISA global network-services contract coming down to the wire

Story Update: DISA told Defense Systems May 3 that the GSM-O award is expected in early June.

The multibillion-dollar Defense Information Systems Agency contract award to provide day-to-day operations of Global Information Grid (GIG) networks and related services is set to begin this spring. At press time, Lockheed Martin and Science Applications International Corporation were the two companies in final source selection bidding for the GIG Services Management-Operations (GSM-O) indefinite-delivery, indefinite-quantity contract. A DISA spokesman said that the GSM-O acquisition was in a “sensitive stage” and could not comment further on the impending contract award.

Barring unforeseen delays, DISA has established a start date of May 1 for the period of performance for GSM-O, an IDIQ contract worth up to $4.6 billion over 7 years that includes a 3-year base period and two 2-year option periods. The awardee will receive a firm-fixed price with incentives, cost-plus-incentive fee or cost-plus-fixed fee task orders.

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Industry observers were surprised that a contract vehicle of GSM-O’s size only garnered the two bidders, Lockheed Martin and incumbent SAIC.

“I am somewhat surprised there aren’t more of the large companies in this industry going after [GSM-O],” said DeEtte Gray, vice president of enterprise IT solutions, at Lockheed Martin Information Systems & Global Solutions. “It’s not typical that there are only two bidders for this kind of large contract, but it does take a lot to put a bid together of this size and scope.”

GSM-O calls for the operations and maintenance of all systems across the worldwide Defense Information Systems Network (DISN), including performance-based services such as provisioning, net operations, net assurance and network maintenance on a global basis. The GSM-O contract replaces the 10-year DISN Global Solutions (DGS) contract awarded to SAIC and Apptis in 2001.

“GSM-O is a different scope of work than DGS,” said Joanna Cangianelli, Lockheed Martin’s capture lead on GSM-O. “What the Government’s done is separated out the operations work from the traditional network engineering and design work. From a contract perspective, perhaps the most important element in terms of affordability is that this contract is moving away from the time and materials type of environment in DGS to a firm-fixed price performance-based contract,” she added.

Cangianelli believes that this GSM-O acquisition structure will now ensure that the winning contractor is measured against key metrics in the delivery of their task order work. “It takes all the risk away from the government and puts it on the contractor to deliver those services within a certain time frame and threshold,” she said.

“There are very few enterprise, and even smaller, jobs that are not fixed price and with some kind of performance metrics that the contractor is held to with penalties if they are not met,” added Gray. “That really is how the government can get the best value and the contractor is motivated to be efficient and perform.”

DISA has designed GSM-O to have an appropriate balance between efficiency and innovation. The contract calls for sustaining the existing network and providing subsequent technology enhancements.

“GSM-O is critical for helping DISA achieve its future initiatives in the improvement of the network,” said Cangianelli. “This is going to be a vehicle where you’re going to have to be able to introduce innovative ideas and concepts to maintain and operate in this new converged environment. The network is changing, as are the demands of the warfighter, and all this has to be done in a more cost-efficient manner,” she added.