9 contracts that changed how government buys tech

The contracts that shaped today's government market, from Advanced Automation System to SEWP IV

Advanced Automation System
Agency: Federal Aviation Administration
When: Awarded in 1981 to IBM Federal Systems.
Why it is important: This contract, which ran through 1994 and cost billions of dollars before it was canceled, was the poster child for why large information technology systems development contracts are so dangerous. The project called for IBM to modernize FAA’s air traffic control system in one big bang. But complexity and cost overruns doomed the project. Some believe the failure of the FAA project helped push procurement reforms later in the 1990s, which made many of the contracts on this list possible.

Contract: FTS2000
Agency: General Services Administration
When: Awarded in 1988 to AT&T and Sprint.
Why it is important: FTS2000 is arguably the first multiple-award, indefinite-delivery, indefinite-quantity contract. AT&T owned the government telecommunications market at the time, and Sprint was largely unknown. The contract broke that mold as it drove down prices and opened the government to the concept of task-order competitions.

Contract: Desktop IV
Agency: Air Force
When: Awarded in 1993 to GTSI and Zenith Data Systems, after a series of protests.
Why it is important: This contract streamlined how the Air Force bought hardware and proved that a large volume of PCs could be procured from multiple sources as part of an IDIQ contract. The new task-order process allowed the Air Force to buy as many or as few PCs as it needed.

Contract: Defense Enterprise Information Systems
Agency: Defense Information Systems Agency
When: Awarded in November 1993 to six companies.
Why it is important: This was one of the first multiple-award contracts unleashed on the market by the Federal Acquisition Streamlining Act. It quickly exceeded its $1 billion ceiling, spawning DEIS II. The success continued as the contract grew and became Encore I and then Encore II, which DISA awarded in May 2008 with a $12 billion ceiling over 10 years.

Contract: GSA Schedule 70
Agency: GSA
Why it is important: The procurement reforms of the mid-1990s brought services to a schedule that was primarily hardware. The addition caused an explosion of business on Schedule 70. Even though sales have fallen slightly in recent years, Schedule 70 still does nearly $17 billion in annual sales. It became a must-have vehicle for companies that wanted to do business in the government.

Electronic Computer Store
Agency: National Institutes of Health
When: Awarded in September 1995 to 17 companies.
Why it is important: This governmentwide contract satisfied a demand for a vehicle that agencies could use to buy large quantities of hardware, software and related services. In two years, it ran through its $100 million ceiling. The follow-on contracts grew significantly. The current ECS III has 66 contractors and a $6 billion limit. It runs through 2012.

Contract: ITOP I
Agency: Transportation Department
When: Awarded in 1996 to 20 companies.
Why it is important: ITOP was the first multiple-award contract with a large number of contractors. But that didn’t deter users. In its first year and a half, it ran through its $1 billion ceiling. ITOP II, was the first large IDIQ with a small-business component, and its success led GSA to take over the contract from the Transportation Department.
Launched in 1996, ITOP gave DOT and other agencies a single source for IT services from 20 contractor teams led by a mix of industry heavyweights, such as Computer Sciences Corp., Unisys Corp. and Science Applications International Corp., and smaller businesses, such as Signal Corp.

Contract: Navy Marine Corps Intranet
Agency: Navy
When: Awarded in 2000 to EDS.
Why it is important: The Navy and EDS took a gamble when the service outsourced its infrastructure to EDS. The $8.8 billion contract nearly sunk EDS because of the financial burden it placed on the company. But today, EDS uses it as a reference to win other work. The Navy decided it doesn’t want a single company to own its infrastructure, so with the compete, it likely will make multiple awards.

Contract: SEWP IV
Agency: NASA
When: Awarded March 2007 to 38 companies.
Why it is important: The SEWP program has become a gold standard in the government for customer service, and the managers running the contract see both agencies and their contractors as customers. The focus on service has helped SEWP survive and thrive into its fourth generation.

Reader Comments

Fri, Jul 24, 2009 Bill DC

The streamlining under Desktop IV truly began under Desktop II, a contract awarded in 1986 to Zenith Data Systems. Desktop II was the first Air Force contract where three services-- Air Force, Army, and Navy--had their requirements for microcomputers met by a single contract vehicle. This set the stage for the IDIQ success under Desktop IV, and might even be called one of the first GSA schedules we recognize today. As technical lead for Desktop II, I had a ringside seat in watching a good idea work (not always a common event in government procurement efforts). At a time when operating systems were proprietary and hardware incompatible, we infused 375,000 interoperable microcomputers into DoD in a little over four years. It was fun to be part of that.

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