Octo Consulting lands 'fixed-price-per-sprint' contract
Octo Consulting has won a $34 million fixed-price-per-sprint contract, which might be the first in the market and could be a sign of things to come as the market evolves how development services are delivered.
A good example of how the government market is meeting the demands of agencies is Octo Consulting’s recent $34 million, fixed-price-per-sprint contract award, which may be the first of its kind to ever hit the streets.
On the surface, the five-year contract is for software engineering, infrastructure and operations and sustainment support for the National Geospatial Intelligence Agency’s Agile Web Presence (AWP) program.
The AWP program develops and sustains the agency’s internal and external web presences, including NGA’s .mil website and multiple websites on the agency’s unclassified and classified networks.
Looking deeper, however, the contract is more than that, said Mehul Sanghani, Octo president and CEO.
“What makes this unique is, instead of buying bellybuttons or asking a contractor to deliver against a finite set of requirements—which is what a fixed price contract does—NGA is buying X amount of development capacity,” Sanghani said.
Bellybuttons, in this case, refers to contract environments like time and material or cost-plus, he added.
“Along the lines of what you would do when you acquire utilities, and you’re paying for X amount of utility capacity by the kilowatt hour; in this case, they are buying development capacity, and they are paying a fixed price for X number of story point that we’re going to delver in each sprint cycle,” Sanghani said, explaining that “story point” is agile vernacular for the amount of developmental units to be delivered.
Octo’s contract is structured in a way that the company will deliver 70 story points.
The company achieved this development environment using Amazon Cloud, the company said in a release.
Sanghani also noted that one of the men responsible for architecting this contract has since moved into a position at the U.S. Digital Service, boding well for other agencies to utilize a fixed-price-per-sprint contract in the future.
Octo may have been the first, but the company does not expect to be the last. “Certainly we think other agencies are going to be taking note and following suit going forward,” Sanghani said.