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By Nick Wakeman

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Nick Wakeman

IBM gets second shot at $158M Army payroll contract

IBM Corp.’s protest of a $157.6 million Army payroll contract won by CACI International is paying dividends for the company.

The Army has agreed to vacate the award to CACI International to re-evaluate proposals and make a new award decision.

The contract in dispute is the Army’s new personnel and payroll system known as Systems Integrator Increment II Integrated Personnel and Pay System – Army. CACI won the contract in December, and IBM filed its protest questioning that decision in January.

It filed a supplemental protest in late February.

But just because IBM has prevailed to this point doesn’t mean it will be the ultimate winner of the contract. CACI is just as likely to win again, but IBM would have a second shot at protesting.

And if you look at IBM’s battle with Lockheed Martin over a Homeland Security Department Border and Customs Enforcement contract, I’d be surprised if IBM didn’t protest again if CACI wins a second time.

Lockheed has twice won the contract, and IBM has twice protested. And twice DHS has canceled the award to Lockheed Martin. With the second cancellation, DHS also cancelled the solicitation and is re-writing the proposal.

IBM was the incumbent on the contract so they have a strong incentive to keep the work. In the case of this Army contract, there is no incumbent contractor, but it is still a good contract for whoever wins.

The Army is modernizing its human resources and payroll systems by integrating the capabilities of some 40 stovepiped HR systems into a single system. Currently, the different systems cannot share information with each other. The goal is to create the Soldier Record Brief, which could become the official personnel document for all Army and Army Reserve personnel, including information on overseas assignments, career data, family and personal data, military education and other information.

The modernization project is being rolled out in increments – hence the name – rather than the big bang approach that failed for its predecessor, the Defense Department-Military Human Resource Systems or DIMHRS, which cost nearly $1 billion and has little to show for it.

The military services have similar efforts underway, so holding this contract could be the gateway for more work on other increments and with the other services.

Posted by Nick Wakeman on Mar 13, 2015 at 9:32 AM

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