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GD Wins Army Computer Contract

by: Matthew Potter
August 31, 2011

Category: Business Line, Companies, Contract Awards, Department of Defense, Events, Federal Budget Process, General Dynamics, IT, logistics, Services, U.S. Army | RSS 2.0

On Monday the U.S. Army awarded General Dynamics (GD) C4 Systems division a contract to provide computer hardware, services and software to all parts of the service. The contract is a Firm Fixed Price (FFP) Indefinite Delivery / Indefinite Quantity (ID/IQ) contract that will last five years. If all of the potential work under the contract is executed it could be worth almost $6 billion.

This is the Command Hardware Systems-4 (CHS-4) contract and is a follow on to CHS-3 awarded to GD back in 2003. GD was the only bidder on CHS-4.

The way an ID / IQ contract is set up it allows different organizations to order equipment and services but there is no requirement or guarantee that anything will be ordered. GD could end up getting little or no work through the contract it just depends on what people need and when they need it. On the other hand if the Army uses it to provide whole sale replacement of equipment GD could be awarded tens of millions in work.

The advantage of the contract is that it requires GD to be able to provide the newest, advanced technology across the five years consistent with commercial products. This means that the Army has an easy, direct source to acquire that for their computer, communication and network needs. It also should be at reasonable prices as most of the items will be strait from the commercial market.

Many times in the past DoD has used ID / IQ contracts to qualify multiple companies and teams to provide the work to allow the Government customer to pick and choose who will provide the best service at the best price. Here GD is the only company and will provide overall management of the contract.

Ideally the way the contract is structured should lead to the acquisition of equipment at efficient prices and in a timely manner. It saves the different parts of the Army from setting up their own contracts or using other vehicles such as the GSA schedule to buy this type of item.

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