21RDCP1_DCPDS_JA_FINAL (Redacted).pdf

I. Agency/Contracting Activity.

Agency: Defense Manpower Data Center (DMDC), 400 Gigling Road, Seaside, CA 93955

Contracting Activity: Defense Human Resources Activity (DHRA), 4800 Mark Center Drive, Alexandria, VA 22350

II. Nature and/or description of the action being processed.

DHRA intends to award a firm-fixed-price, sole source contract to Leidos, Inc. (Leidos) for software and maintenance services in support of the Defense Civilian Personnel Data System (DCPDS). This contract is a follow-on to task order SP4701-20-F-0157, which was awarded against Defense Logistics Agency contract SP4701-12-D-0006 and is set to expire September 27, 2021. In order to comply with DHRA direction to bring more contracts in-house it was agreed that DCPDS sustainment was a good candidate. The period of performance for this requirement is a 12-month base period and one 12-month option period. The total estimated value of the contract is , including the option. Fiscal Year (FY) 2021 Operations and Maintenance (O&M) funds in the amount of are available for the base period.

III. Description of supplies/services required to meet agency needs.

DCPDS is the Department of Defense (DoD) human resources (HR) information system designed to support civilian personnel operations. DCPDS is a multifunction, web-based civilian HR information management and transaction processing system. The system supports over 900,000 civilian employee records and 1.5 million position records. It is a global system supporting users in Asia, the Pacific, Europe and North America on a 24-hour, 7-day-a-week basis. DCPDS uses a Commercial Off-The-Shelf (COTS) product (Oracle HR), customized for the Federal and Defense environments, to provide personnel transaction processing.

Software integration and maintenance services are required to ensure that all applications are fully compatible and integrated with current software and hardware within DMDC until the DCPDS is successfully migrated to the cloud-based Defense Civilian Human Resources Management System (DCHRMS).

IV. Statutory authority permitting Other than Full and Open Competition.

The statutory authority is 10 U.S.C.2304(c)(1), as implemented by FAR 6.302.1 “Only one responsible source and no other supplies or services will satisfy agency requirements.”

V. Demonstration that the contractor's unique qualifications or nature of the acquisition requires the use of the authority cited above (applicability of authority).

Pursuant to FAR 6.302-1 (a)(2)(iii), DoD may deem services to be available from only one source in the case of follow-on contracts for the continued provision of highly specialized services when it is likely that award to any other source would result in (A) Substantial duplication of cost to the Government that is not expected to be recovered through competition; or (B) Unacceptable delays in fulfilling the agency’s requirements. Competing this requirement would result in both a substantial duplication of cost to the Government that is not expected to recover through competition and an unacceptable delay in fulfilling the requirement.

DCPDS is a critical system for civilian employee accountability and proper payment to civilian employees.

Several key functions of the system include: managing employee payment and leave records, performance management, processing and tracking of human resources and personnel actions, employment verification, and professional development. Any delay in service would shutdown the system and jeopardize the integrity of the DoD HR records system as well as delay payment to over 900,000 DoD Civilian employees.

DCPDS is a very complex system with millions of lines of code encompassing multiple architectures, engineering and user interfaces, analysis algorithms, and uniquely modified Oracle Fusion Software-as-a- Service (SaaS) Product configurations. The core DCPDS COTS product is based on Oracle EBS FedHR, for which DoD is the only customer. Significant customizations and usability enhancements were made to the COTS product to support Defense Performance Management & Appriasal System (DPMAP), Defense Civilian Intelligence Personnel System (DCIPS), and National Guard (NG) performance appraisal applications. Other customizations support the DoD diverse work force, including appropriated fund, non-appropriated fund, local national, and National Guard employees. Included in the appropriated fund category are General Schedule, 11 demonstration projects and alternate personnel systems. DCPDS supports numerous legislative Titles including Title 5, 10, 20, 28, 29, 32, 33, and 38. There are 11 modules customized to support 18 foreign countries that are multi-lingual and have multiple currencies. With over 500,000 process rules and 1.75M pay and benefit algorithm combinations, DCPDS sustains a complex set of personnel data that interfaces with the DoD payroll system. DCPDS also maintains over 40 other custom interfaces to external systems and databases, each with its own format, layout, sequencing, interval, and validation.

In March 2018, Reform Management Group, led by the DepSecDef, approved a plan presented by the IT Reform Lead, to abandon projected work on the Oracle E-Business Suite (on which DCPDS was built) and instead, migrate efforts into implementing a Software-as-a-Service cloud solution. Following the Department’s selection of the Oracle Cloud Infrastructure (OCI) in 2019, DMDC began the process of migrating its data centers. Through an efficient and cost effective interagency agreement with the Defense Health Agency (DHA), DMDC obtained a new Cyber Security Service Provider (CSSP) that required newly refined processes before the migration from the Denver Data Center could be finalized. The CSSP required fully reviewed and processed work orders to open the appropriate firewall ports/protocols. Additionally, the move to OCI necessitated changing the load balancer from Citrix Netscaler to f5 Big-IP. The translation and rewrite of rules and their extended testing took eight (8) week. After DMDC and the CSSP completed those threshold requirements, they successfully migrated DCPDS from the Denver Data Center to OCI between August 2020 and September 2021 and completed the work before the data center officially closed.

Because of the cost benefit analysis, DMDC did not include the additional environments in the Leidos San Antonio, Texas (SATX) facility in the migration to OCI. The San Antonio facility includes significant investment in Government Furnished Equipment (GFE) for the development and test environments. The annual maintenance costs to support these environments are lower than what the annual subscription costs to replicate the footprint in OCI would be. Given this delta, the DMDC planned to run SATX until DCPDS is decommissioned. At that point, DMDC will reutilize, transfer, or relocate the equipment to support other DHRA missions.

Leidos possesses unique and highly specialized knowledge and capability with regard to the necessary software configurations as well as DCPDS requirements based on their extensive knowledge and experience with the program application and operating environment. Leidos has specific knowledge of the functions, data, and system interfaces as it relates to integrating the various applications (over 43 applications).

The DoD Reform Initiative for Data Center Optimization Initiative (DCOI) established in OMB Memorandum

M-19-19 requires agencies to optimize and consolidate data centers to deliver better services to the public while increasing return-on-investment to taxpayers. As such, DCPDS has been identified as a candidate for optimization. A contract has already been awarded for the migration effort. This migration will increase efficiency across the DoD by combining all services into one cloud while reducing costs on server maintenance. However, in order for the Government to migrate DCPDS to the DCHRMS Oracle Cloud Infrastructure on schedule, it must have a vendor that understands the existing software design, code base, testing, interfaces and applications provide the required operations, sustainment, and maintenance support.

Without sustainment of the DCPDS, the DoD mission for DCHRMS implementation is at risk. Successful implementation of the DCHRMS requires successful migration of the DCPDS to the Oracle cloud environment. Therefore, DCPDS must have sustainment support throughout the migration effort.

Leidos is the current contractor performing the sustainment functions for DCPDS. It is critical that DMDC continues to utilize the services provided by the existing vendor, as they have over 10 years of specialized experience in supporting the the DCPDS. The Government estimates a minimum of a 18 month transition period would be required in order for a new vendor to overcome its learning curve and obtain the basic institutional knowledge required to successfully perform. Failure to obtain sustainment support from Leidos would seriously affect mission operations of DoD Civilian Community as well as other Federal agencies.

Mission impacts would include the inability to meet DoD Audit Readiness requirements, inability to disburse payroll and civilian personnel policy changes, and overarching schedule delays to the newly awarded DCHRMS contract which is in place to rationalize DCPDS to the HR Cloud.

Additionally, the current infrastructure of the DCPDS system is located within a Leidos facility in San Antonio, Texas. A new vendor would need to relocate this infrastructure out of the Leidos facility and into a new location. The Government has already purchased the DCPDS infrastructure which contains numerous racks of equipment, servers/storage area network/Back up tape library/Uninterruptible power supply (UPS) systems, switches, routers and 75 workstations. Relocation would require the DCPDS to be systematically shut down, transitioned and moved in such a way that the equipment is protected, reassembled and configured correctly so that on-going missions are not impacted and critical information is not lost. All library archives must be packed, labeled, unpacked and inventoried to ensure that DCPDS test data is accessible and available after relocation. Defense Information Systems Agency (DISA) network connections would require reconnection, redirection and testing to ensure connectivity after the move. Information assurance paperwork will require updates to establish and maintain the Information Authority to Operate (IATO) of networks after the move. Moreover, much of the IT infrastructure is at the end of its useful life and cannot be relocated. The Government would have to reprocure this infrastructure and pay current market prices. Purchasing new infrastructure is not in the Government’s best interest given the on-going effort to migrate DCPDS to the DCHRMS cloud environment. Total relocation expenses to transition the Government Furnished Equipment (GFE) at Leidos to a new facility is estimated to exceed $5M in duplicative costs. The Government does not expect to recover these costs through competition.

In addition to substantial duplication of costs, award to another vendor would put the Government at risk for unacceptable delays. Relocation of the DCPDS infrastructure would require installation of a T1 internet line approved and installed by the Defense Information Systems Agency (DISA). Installation through DISA includes an approval process that can take 9-12 months. However, the line cannot be requested until after a contract has been awarded.

Delays associated with relocation would impose significant schedule risk to meeting the stated deadline of migrating DCPDS to DCHRMS and delivering software releases for policy changes scheduled to take place between August and November 2021. A lapse in service to relocate the system infrastructure would degrade system capabilities because the Government would be unable to address system failures or apply security patches. This would result in system unresponsiveness once DCPDS was brought back online. The Government would be unable to process personnel actions and payments for its civilian workforce until these issues were addressed. There would be major schedule impacts to the program’s ability to meet DoD Reform Initiative for Data Center Optimization Initiative (DCOI) goals. This would place the program at risk of mission failure which would adversely impact multiple DoD and Federal agencies supported by the program.

Leidos is the only source with the knowledge and experience to sustain the DCPDS without any delays in performance. As outlined in the preceding paragraphs, award to another contractor would result in severe, negative impact on the DoD mission and its civilian workforce. Sole source award of this sustainment requirement enables the Government to maintain critical support to its workforce as well as meet the DoD’s overarching requirement to migrate DCPDS to the DCHRMS cloud environment.

VI. Description of efforts made to ensure that offers are solicited from as many potential sources as practicable.

A Sources Sought Notification/Notice of Intent (SSN/NOI) to sole source (Notice ID: H98210-21-R-DCP1) for the requirement was posted on the Government Point of Entry (GPE), BETASAM, on June 10, 2021 with a closing date of June 21, 2021. In response, one vendor, submitted a capability statement. The capability statement was reviewed and was determined to not meet the requirement.

The SSN/NOI instructed interested parties to describe their experience and expertise in nine (9) areas related to maintaining a Federal EBS and complying with DoD cybersecurity requirements. provided a generic overview of its experience as a staffing and consulting firm. It did not have the specific SaaS expertise to maintain the DCPDS. stated that for each Government requirement, it would hire the qualified personnel to meet the Government’s requirements. No other sources expressed interest in this requirement.

VII. Determination by the Contracting Officer that the anticipated cost to the Government will be fair and reasonable.

The Contracting Officer will determine a fair and reasonable price utilizing proposal analysis techniques found at FAR 15.404-1, including comparison with historical prices paid and/or comparison to the Independent Government Cost Estimate.

VIII. Description of the market research conducted and the results, or a statement of the reasons market research was not conducted.

In accordance with FAR 10.002, DMDC conducted market research to determine whether or not alternative solutions and providers fully capable of meeting the entire requirement existed in the marketplace. Market research was performed via research of existing Government contracting vehicles (GSA schedule, GWACs), vendor websites, a sources sought, and internet searches. Market research was conducted and, while there are other vendors that can provide sustainment services, only the existing vendor has the infrastructure in place and the required expertise to successfully sustain and maintain the existing DCPDS without duplication of costs and unacceptable delays while the system migrates to OCI.

IX. Any other facts supporting the use of Other Than Full and Open Competition.

None. See paragraph V above.

X. List of sources, if any, that expressed interest in the acquisition.

Size: Small Business

XI. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before making subsequent acquisitions for the supplies or services required.

The subject requirement is for sustainment purposes of the DCPDS until such time that the system is migrated to DCHRMS. A contract was competitively awarded for that effort. The Government does not anticipate needing continued sustainment support for the DCPDS beyond this current requirement.

XII. Certification by the Contracting Officer.

As evidenced by my signature above, I have determined this document to be both accurate and complete to the best of my knowledge and belief.

XIII. Certification by the technical/requirements personnel.

As evidenced by my (our) signature(s) above, I (we) certify that any supporting data contained herein, which is my (our) responsibility, is both accurate and complete.