Signal snags Senate outsourcing contract worth $100 million

Signal Corp. has won a $100 million contract to provide a wide range of information technology services to Senate offices on Capitol Hill and in 450 field offices across the country.The Senate network includes 9,000 desktop computers and 1,000 servers. Signal of Fairfax, Va., will work with teammates Hewlett-Packard Co., Palo Alto, Calif., and Interstate Van Lines, Fairfax, Va., to provide computer help-desk support, IT installation and maintenance, and acquisition and inventory for hardware and software."This is the largest contract we've ever won in terms of real work, rather than [indefinite delivery, indefinite quantity] contracts where orders are placed against them," said Bob Smith, chief administrative officer for Signal. "This is about $80 million in labor, $20 million in other direct costs, primarily products which Hewlett-Packard will provide."Signal will man a state-of-the-art help-desk system, which will use a wide array of automated support tools and detailed procedure lists to resolve IT problems in just one telephone call. Both Signal and Hewlett-Packard will handle installation of new equipment, while HP will provide support at all Senate locations.In addition to IT services, the contract also provides for expansion into other areas, including local area network design, threat and vulnerability analysis, network performance monitoring, security and a variety of systems administration.Signal's projected revenue for fiscal 2002 is $304 million. "This was part of our business plan [this year], to win this contract," Smith said.The contract runs through the end of this fiscal year and then has five one-year options. "It's performance based; if we do well, we get renewed every year," he said.The importance of providing outstanding service to senators cannot be overemphasized, Smith said."Our clientele is obviously very important, and their network availability is their life's blood," he said. "There is ongoing technology refreshment of the Senate. Part of our challenge as well is to keep them at the cutting edge of technology."The prestige attached to a highly visible contract such as this has other benefits that may be hard to quantify, Smith said, but he believes it will help the company achieve its goals in the federal sector.The Senate contract includes service-level agreements that will reward Signal for its performance. "The better you do, the more money you make," Smith said.Bruce Klein, vice president of Hewlett-Packard's federal division, said his firm has conducted business with the Senate before. "It is a prestigious account [with] multiple locations that poses interesting questions," he said. "It's a high level of visibility and a high level of support."Signal lost the preceding contract to Affiliated Computer Services Inc. when the contract was awarded in 1998. The company's president and chief executive officer, Roger Mody, "resolved we were going to be prepared to win the next time," Smith said.A key factor in being selected by the Senate, Smith said, is that Signal put an ISO 9001 quality management system in place. "It's a huge discriminator to have a quality management system," he said.Smith also credited the company's comfort in working with service-level agreements for its success in earning the Senate contract."Signal's past performance is extremely good," Smith said. "We have many contracts that are performance-based fee contracts. We regularly score in the 90s, which is like getting an 'A.' "The transition from ACS to Signal is already under way, Smith said, with the program to be fully staffed and in his company's care June 3. There will be roughly 55 Signal personnel working on Capitol Hill.HP's Klein said he did not know how many people would be supporting Senate field offices. "The manpower requirements depend on the tasks. We will meet our service level agreements," Klein said.