JA19-102__RM_DAI_Support_05202019_Final_Redacted.pdf

JUSTIFICATION & APPROVAL (J&A) FOR FEDERAL ACQUISITION

REGULATION (FAR) SUBPART 16.5 ACQUISITIONS

EXCEPTION TO FAIR OPPORTUNITY

Multiple Award Schedule/Multiple Award Contract (MAC)

Orders under MAC/ Fair Opportunity – FAR 16.505, Department of Defense FAR Supplement (DFARS) 216.505-70, Procedures, Guidance and Information (PGI) 216.505-70

Purchase Request Number: To be determined (TBD) Contract Number: HHSN316201200018 Task Order Number: HC1047-18-F-0060 Procurement Title: Resource Management (RM3) Support Estimated Value:

Authority: FAR 16.505(b)(2)(i)(B)

JUSTIFICATION FOR AN EXCEPTION TO FAIR OPPORTUNITY

Number: JA19-102

Upon the basis of the following justification, I, as the Head of the Contracting Activity, hereby approve this exception to fair opportunity pursuant to the authority of FAR 16.505(b)(2)(i)(B).

1. REQUIRING AGENCY AND CONTRACTING OFFICE:

Requesting Agency:

Defense Information Systems Agency (DISA)

RM3

3990 E. Broad Street Whitehall, OH 43213

Contracting Activity:

DISA/Defense Information Technology Contracting Organization (DITCO) National Capital Region (NCR) / PL61

6910 Cooper Ave.

Fort Meade, MD 20755

2. NATURE/DESCRIPTION OF ACTION(S): This procurement action is a modification for RM3 Support Services currently provided by Deloitte Consulting, LLP (Deloitte) under order number HC1047-18-F-0060. The period of performance remains unchanged from the original award with a one-year base period plus four one-year optional periods from September 1, 2018 through August 31, 2023. The modification will increase the existing Firm-Fixed-Price (FFP) labor contract line item numbers (CLINs) and add a Cost Reimbursable surge CLIN, which will account for of the total labor price on the existing order. The order will continue to be funded with Operations and Maintenance (O&M) and Defense Working Capital (DWCF) funds.

3. DESCRIPTION OF SUPPLIES/SERVICES: The order provides for RM3 Support Services in accounting, financial management, budget rate generation, execution reporting, variance analysis, problem resolution, data reconciliation, business process improvements, software

RM3 Support-JA19-102

Page 2 of 9 Pages development, analytical services, audit readiness support, and robotics automation processes support to the DISA RM3. The order includes the following task areas:

PWS 6.1 Program Management PWS 6.2 Application and Information Operational Support PWS 6.3 Accounting Operations & Financial Management Support for Working Capital

(WCF) and General Fund (GF) PWS 6.4 Financial Statement Audit Support PWS 6.5 Management Internal Control Program (MICP)

The purpose of this modification is to provide additional contractor support for the Defense Agencies Initiative (DAI) system support (PWS Task 6.2), Circuit Analysis/(Defense Information Systems Network (DISN) Support (PWS Task 6.3), Tier 1 Support (PWS Task 6.3), RM/Financial Management Liaison Office (FMLO) Systems Information Technology (IT) Support (PWS Task 6.2), and Robotics Automation Process Implementation for Telecommunication contract close-out process (PWS Task 6.2 and PWS Task 6.4). The modification will not change the period of performance but is required ahead of the fourth quarter for Fiscal Year (FY) 2019. The lifecycle value of the current order is .

The modification action would increase the order to by approximately beginning on June 1, 2019 through August 31, 2023.

4. SUPPORTING RATIONALE, INCLUDING A DEMONSTRATION THAT THE

PROPOSED CONTRACTOR’S UNIQUE QUALIFICATIONS OR THE NATURE OF THE

ACQUISITION REQUIRES USE OF AN EXCEPTION TO FAIR OPPORTUNITY:

(a) Exception to Fair Opportunity. FAR 16.505(b)(2)(i)(B) - Only one awardee is capable of providing the supplies or services required at the level of quality required because the supplies or services ordered are unique or highly specialized.

(b) Description of the Justification. DAI was deployed to approximately 20 Department of Defense (DoD) agencies prior to being implemented at DISA in October 2018. DISA expected the DAI solution to have evolved to a highly mature, functional state, where only a minimal number of complex issues were anticipated. However, following DISA’s implementation of the Financial Accounting Management Information System - Working Capital Fund (FAMIS-WCF) and DAI accounting systems, DISA has realized the need for significant post-implementation support due to system defects, unforeseen accounting issues, and substantial post-implementation requirements than originally anticipated for DISA’s operational accounting, financial reporting, operations and maintenance needs across the integrated financial management systems environment.

In the first six months of the accounting system implementation and transition in DISA, over 215 Product Service Requests (PSR) were required for action. On average, there are between 60-80 unresolved PSRs that severely impact DISA financial operations and this number of incidents is not expected to decrease in the upcoming months. This significant, complex post-implementation support that is intertwined with the Deloitte solution, has driven the need for this modification.

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In addition, the Office of Management and Budget (OMB) Memorandum M-18-23, dated August 27, 2018, was issued in response to the President’s Management Agenda (PMA) that directs Federal Agencies to develop and implement strategies that create greater efficiencies in the workplace, such as introducing new technologies to reduce repetitive, manual tasks. DISA has identified that there are many steps associated with closing out Communication Service Authorizations (CSAs), which involve pulling data from multiple databases including Electronic Document Management System (EDMS), Contract On-line Procurement System (COPS), Financial Accounting Management Information System (FAMIS), and Electronic Document Access (EDA), in order to build an electronic file to close-out contracts and orders. To significantly reduce the repetitive, manual tasks associated with contract and order closeout, DISA requires robotics process automation (RPA). RPA is a task area of the existing Performance Work Statement (PWS), on the original award. The RPA requirement for telecommunications contract close-out is in direct support of audit readiness and in compliance with the OMB Memorandum M-18-

23. Increased effort is required following identification of a potential RPA solution for implementation to cover the telecommunications contract close-out and in support of audit readiness.

As a result of these unavoidable and unforeseen interface issues and required audit readiness support, this J&A action is essential to providing RM3 with post-implementation support in order to maintain the integrity and accuracy of financial information and the RPA requirement, in compliance with the OMB Memorandum M-18- 23.

(c) Justification.

(1) Minimum Government Requirements. The minimum requirement is a modification executed for additional support to be provided by May 31, 2019 for the remaining base period and through all remaining four optional periods, with no changes to the overall period of performance of the original order. The total projected cost of this action is estimated at approximately including labor and of total labor for surge and includes the following support:

A. DAI Support under PWS Task 6.2

Support is required to resolve all issues and maintenance requests arising from the operation of the DAI to address critical issues, including system downtime or outages.

B. Circuit Analysis/DISN Support under PWS Task 6.3

Support is required to develop, support and maintain financial reports operations, reconcile financial data access circuit ordering, budgeting, contracting, inventory, and billing systems to provide cost/revenue assurance of DISN.

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C. Tier 1 Support under PWS Task 6.3

Support is required to log helpdesk tickets, assist users log issues, lead year-end planning and test coordination, assist with maintenance of accounting code tables, assist with Government acceptance testing for FAMIS-WCF changes, and support DISA RM3 in determining priority of enhancements.

D. RM/FMLO Systems IT Support under PWS Task 6.2

Support is required for critical IT and systems administration, desktop/server support, and continuity of operations (COOP) support to provide accurate and timely recording of revenue and costs for financial reporting.

E. RPA Support under PWS Task 6.2 and PWS Task 6.4

Support is required to develop automated routines for the telecommunications contract close-out process based on process robotic solutions to replace manual activities currently required to support accounting operations. Support shall include transaction input and validation, source document maintenance and problem identification and resolution.

(2) Proposed Sole Source Contractor. The proposed sole-source contractor is Deloitte of

1919 N Lynn St, Arlington, VA 22209-1742. Deloitte has unique capabilities, experience and expertise in performing the required complex support.

DISA requires contractor services to perform analytical services for accounting operations, financial management services and financial systems support. DISA has migrated to an Oracle based platform; therefore, critical performance must be able to meet scope, magnitude and complexity required.

Deloitte has successfully provided support under the existing order and their competence in this area is unique and indispensable to RM3 to maintain the integrity and accuracy of DISA’s financial information and audit readiness support at an acceptable level of risk.

(3) Discussion Regarding Cause of the Sole Source Situation. The sole source situation resulted from migrating accounting processes into two new systems, both Oracle based. Additional support is required for the new systems and the transition from the legacy systems to mitigate the unforeseen and unanticipated post-implementation support requirements. Another factor contributing to this situation is, the identification of RPA implementation capabilities in the telecommunications contract close-out process in support of audit readiness and in compliance with OMB Memorandum M- 18-23.

(4) Demonstration of Unique Source. This new requirement executed under order number HC1047-18-F-0060, supports the massive changes into two new accounting systems

Page 5 of 9 Pages for the DISA General Fund (GF) and the Working Capital Fund (WCF) while also undergoing a full financial statement audit. These new requirements require that the contractor has knowledge of both DISA legacy accounting systems and new accounting systems, as well as business processes and how they would be executed in the future.

The complexity of the new requirement was due to the following:

A. Operations Realignment – DISA RMC has consolidated all accounting operations and audit support under a single office and DISA is in the process of migrating to a single WCF. The RM3 requirement addresses the business processes supporting all of DISA financial activities as opposed to the previous requirement focusing on individual lines of business. The organizational realignment increased the need to have consolidated support across all DISA locations that RM supports including;

Pensacola, Scott AFB, Columbus, and Ft. Meade.

B. Oracle Accounting System Experience – DISA migrated its accounting to two new systems that are Oracle based. It is critical that the contractor have Oracle knowledge to ensure continuity in accounting operations. In addition, this order relies on ensuring that there is knowledge on both DISA legacy systems for GF and WCF as well as the new accounting systems mandated by the Offices of the Secretary of Defense (OSD).

C. Process Robotics – To significantly reduce the repetitive, manual tasks associated with contract and order closeout, DISA requires robotics process automation (RPA).

Support will include transaction input and validation, source document maintenance and problem identification and resolution.

E. Help Desk – DISA has transitioned to a new Oracle Accounting System, DAI, which will also support Time and Labor. DISA will be creating a Help Desk Team to develop operating guidance that will apply to all Help Desk personnel and all DISA users of DAI, including all employees, remote access users, contractors, vendors, and any other party who is authorized to access the DISA DAI system. DISA Help Desk personnel will perform the documented procedures necessary for effective and efficient operations, which includes:

• DISA Help Desk Operations based upon Oracle Enterprise Resource Planning (ERP) knowledge

• DISA Help Desk Problem Management Procedures

• DISA Supported Applications and Services

• DAI PMO Help Desk Problem Escalation Procedures

This Tier 1 Help Desk will be inclusive of all functional and technical issues as they relate to DAI. DISA’s Help Desk Team will triage, develop and capture all DAI issues via a new and DISA approved trouble ticket tracking methodology. The DISA DAI Help Desk will provide support for the following DAI applications and services:

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• Time and Attendance (OTL)

• Cost Accounting (CA)

• Procure to Pay (P2P)

• Order to Cash (O2C)

• Budget to Report (B2R)

• Acquire to Retire (A2R)

• Contract Lifecycle Management (CLM)

• Purchase Request Document Standard (PDRS)

• Oracle Business Intelligence Suite Enterprise (OBIEE) Reporting

• User Management Extension (UMX)

• IT / Infrastructure Support

• Communication of System Availability

• Budget Formulation

F. Tier 1 Support – Tier 1 support is required for the FAMIS-WCF accounting system and is related to the interface in the DAI transition. DISA RM3 requires daily FAMIS- WCF post-implementation and Tier 1 support requirements for the Telecommunication Service and Enterprise Acquisition Services (TSEAS) business area.

The complexity of these requirements include the ability to support a full end-to-end implementation of a new ERP for both DISA GF and WCF, but also the ability to understand DISA legacy processes and successfully transition them into the new environment.

The complexity of these requirements also includes the overall ability or capability to concurrently provide quality accounting, financial management, budget rate generation, execution reporting, variance analysis, problem resolution, data reconciliation, business process improvements, software development, analytical services, while implementing the new ERP, the required Help Desk team, and support a full Financial Statement Audit mandated by the Office of the Secretary of Defense (OSD) at the different DISA locations.

(5) Procurement Discussion. The original order was a new requirement competed as an unrestricted, fair opportunity procuremen

(6) Impact. As a result of significant post-implementation support due to the transition and implementation of the accounting systems, DISA has experienced detrimental effects to the DISA/DoD systems and interfaces which has influenced the overall integrity and accuracy of DISA’s financial information. There are between 60-80 unresolved PSRs that have severely impacted DISA financial operations and the number is not expected to decrease month over month. As a result, this has caused undue burden to the Tier 1 support team that was not originally anticipated. In addition, contract awards and modifications are not being processed through the contracting interface and as a result, RM3 is unable to sustain the volume of manual contract award / modification line item obligation entry. Furthermore, the manual processing of financial transactions, due to the issues with the systems interfaces will cause further delays in payment to vendors and increasing the risk of work stoppages due to funding processing issues. Finally, as it relates to the telecommunications contract close-out RPA, DISA would not be able to comply with the OMB Memorandum M-18-23, which directs Federal Agencies to develop and implement strategies that create greater efficiencies in the workplace.

5. COST/PRICE FAIR AND REASONABLE DETERMINATION: The Contracting Officer will make a fair and reasonable cost or price determination by utilizing one or more of the procedures found in FAR 15.404-1.

6. MARKET RESEARCH: Market research was conducted by RM3 and the Contracting Office from February through May 2019. Market research was completed for the original award and the results supported an unrestricted fair opportunity competition utilizing the National Institutes of Health (NIH) / Office of Management and Budget’s Government Wide-Acquisition Contract (GWAC), “Chief Information Officer-Solutions and Partners 3 (CIO-SP3)” for IT services. Two sources sought announcements were issued, one in FY17 and one in FY18, and small businesses were reviewed and determined to be incapable of meeting this complex requirement. Ultimately, it was determined that the responses submitted and obtained did not address all major requirements and did not demonstrate the full ability to execute concurrently, at multiple locations, and execute all major mission critical requirements.

The order, HC1047-18-F-0060, was awarded less than 12 months ago and upon review , it has been determined that only one source is capable of providing the services at the level of quality required because the services required are unique and highly specialized. The technical evaluation not only represents the most current analysis of the company capable of meeting the Government’s requirements, but the technical evaluation also considered the entirety of the requirements, which the sources sought data did not. Given the aforementioned, when determining the most appropriate acquisition strategy, the technical evaluation takes precedence over the analysis of the sources sought capabilities statements. After review of the technical evaluation it was been determined that only one source is capable of providing the services for this modification at the level of quality required because the services required are unique and highly specialized.

7. ANY OTHER SUPPORTING FACTS: None.

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8. ACTIONS THE AGENCY MAY TAKE TO REMOVE OR OVERCOME BARRIERS

THAT LED TO THE EXCEPTION TO FAIR OPPORTUNITY:

(a) Procurement History.

(1) Deloitte was awarded task order HC1047-18-F-0060 as a new requirement with a one-year base plus four one-year optional periods and a period of performance beginning from September 1, 2018 through August 31, 2023.

(2) This order was awarded based on Federal Acquisition Regulation (FAR) 16.5 procedures utilizing the National Institutes of Health (NIH) / CIO-SP3 for IT services.

(3) This order was competed as unrestricted, fair opportunity.

(b) The complexity of a full end-to-end implementation and transition of legacy systems to a new ERP for both the GF and WCF while simultaneously providing support in audit readiness, data cleansing, financial and operational support as well as robotics automation processes at the different DISA locations results in a highly unique and technical requirement necessitating an exception to Fair Opportunity for this procurement action.

9. REFERENCE TO THE APPROVED ACQUISITION PLAN (AP): A streamlined acquisition plan was approved at the time of original award on April 20, 2018. The AP will be modified to account for the increase in total dollar value associated with this modification.

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TECHNICAL CERTIFICATION: I certify that the supporting data under my cognizance which are included in the J&A are accurate and complete to the best of my knowledge and belief.

NAME: Janet Pearce SIGNATURE: See separate PDF

TITLE/ORGANIZATION: COR/DISA RM3

PHONE:

REQUIREMENTS CERTIFICATION: I certify that the supporting data under my cognizance which are included in the J&A are accurate and complete to the best of my knowledge and belief.

NAME: Greg Swonger SIGNATURE: See separate PDF

TITLE/ORGANIZATION: Acting Chief, Integration Branch/DISA RM3

CONTRACTING OFFICER CERTIFICATION: I certify that this justification is accurate and complete to the best of my knowledge and belief.

NAME: Samantha Kelly SIGNATURE: See separate PDF

TITLE/ORGANIZATION: Contracting Officer, DISA/DITCO-NCR / PL61

HEAD OF THE CONTRACTING ACTIVITY APPROVAL: I have reviewed this justification and find it to be accurate and complete to the best of my knowledge and belief. Since this justification does not exceed $93M, this review serves as approval.

NAME: Douglas W. Packard SIGNATURE: See separate PDF

TITLE/ORGANIZATION: Head of the Contracting Activity, DISA/DITCO

ALL QUESTIONS REGARDING THIS JUSTIFICATION ARE TO BE REFERRED TO

Samantha Kelly, Contracting Officer, DISA/DITCO-PL61, , samantha.a.kelly8.civ@mail.mil.