Limited Source Justification _Redacted.pdf

OPOAM 3008.405-6(a)(2)

Limited-Sources Justification (LSJ) For orders or BPAs exceeding the Simplified Acquisition Threshold

LSJ No.: FY25-00315

This acquisition is conducted under the authority of the Multiple-Award Schedule Program, 41 U.S.C. 152(3), Competitive Procedures, and 40 U.S.C. 501, Services for Executive Agencies.

1. Agency and Contracting Activity. Identification of the agency and the contracting activity, and specific identification of the document as a “Limited-Sources Justification.”

The Department of Homeland Security (DHS), Office of Procurement Operations (OPO), Information Technology Acquisition Center (ITAC) proposes to award an order pursuant to FAR 8.405-6(a), Limiting-Sources.

2. Nature and/or description of the action being approved. Describe the action being approved and include the name and address of the proposed contractor(s).

The DHS OPO intends to limit the number of sources solicited pursuant to FAR Part 8.405-6(a) for the procurement of ServiceNow Licenses via Carahsoft Technology Corp., 11493 Sunset Hills Road, Suite 100, Reston, Virginia 20190.

The requested support will provide DHS with the following:

IT Service Management Professional and Application Engine Unrestricted User product model for all (all DHS components except USCG, not on Government Community Cloud (GCC).

DHS Cross-Component Reciprocity.

Impact support services for instance consolidation.

Now Assist (AI) starter packs + transactions for all currently active Cross-

Component GCC instances.

Includes HR Service Delivery (HRSD).

Includes expert services for application development.

DHS OPO intends to solicit ServiceNow products and services described above on a limited-source basis from Carahsoft, the sole authorized General Service Administration (GSA) Multiple Award Schedule (MAS) distributor of ServiceNow products and services.

3. Description of Supplies/Services. Describe the supplies or services to be acquired.

Provide the estimated total value (including options, if any).

The requirement is to provide a custom Enterprise SKU – A single, integrated offering aligned with DHS business objectives that enhances cost efficiency, enables collaboration and shared services across Components, and facilitates innovation in a consolidated SKU for ServiceNow Licenses - ITSM Pro and App Engine for DHS-wide use, at a total cost of . This

DHS enterprise SKU aims to strategically unify and optimize core ServiceNow products across all DHS Components.

DHS reached out to GSA to confirm that Carahsoft is the sole distributor and only source that provides ServiceNow products and services required to support this requirement via the GSA MAS Contracts. Therefore, there is only (1) source available to fulfill DHS’s need.

Period Unit Price Total Base Period, 9/30/25 – 8/10/26

The Enterprise SKU is broken down into the following products/support:

PROD24560, PROD24513, PROD25532, PROD21223, PROD25894, PROD24406,

PROD17257, PROD19352, PROD26867, PROD23329

4. Authority and supporting rationale. Select one of the circumstances justifying limiting sources pursuant to FAR 8.405-6(a)(1)(i) below and demonstrate the proposed contractor’s unique qualifications to provide the required supply or service.

In accordance with 8.405-6(a)(1)(i)(B), only one source, Carahsoft, is capable of providing the supplies or services required at the level of quality required because the supplies or services are unique or highly specialized.

DHS has confirmed that Carahsoft is sole provider of ServiceNow products and services via the GSA MAS contracts. Therefore, there is only one source available to meet the Government’s needs. Carahsoft’s GSA MAS contract contains a list of Participating/Authorized Dealers that may utilize their MAS contract to supply ServiceNow products and services, but ultimately, they are the sole provider. Any purchase for ServiceNow under a GSA MAS contract will be supplied by Carahsoft. The ServiceNow SKU will include IT Service Management Professional (ITSM Pro) and App Engine for DHS-wide use. This requirement will provide a single workflow architecture enterprise service management platform to provide IT service delivery tools to all services, organizations, and user communities within DHS to support Network Modernization, Digital Transformation Strategy, Enterprise Service Management, Category Management, and Technology Business Management policies. ServiceNow would further connect DHS and allow it to make better IT business management decisions, modernize, consolidate and enterprise all IT actions under one tool set.

DHS network architecture, maintenance platforms, and configuration systems require the use of this product to ensure interoperability with other DHS systems at all data centers. The use of other products will result in interoperability, compatibility, and/or interface issues that would prevent the system’s support team from providing efficient and effective customer support. DHS has worked to support a connection between ServiceNow and Maestro (a DHS system that uses Atlassian Jira for agile development) over the last two years. That connection frequently fails and the systems have to be manually recalibrated, resulting in delays in work, lost tickets, decreased customer satisfaction, and additional labor hours to reestablish the connection.

The results of the market research clearly indicate that the proprietary software offered by ServiceNow has several unique features and functions not presently available in the marketplace.

This justification supports the limited source procurement of ServiceNow as the only platform capable of meeting the Department’s requirements for a unified, scalable, and secure enterprise-wide solution for IT Service Management (ITSM), App Engine, and digital transformation.

Market Research was conducted via internet searches of ServiceNow’s unique qualifications, coupled with a direct comparison to its competitors—including Jira Service Management (Atlassian), BMC Helix, Zendesk, Freshservice, and Cherwell—demonstrates that no other vendor can fully meet the Department’s operational, technical, and security needs.

ServiceNow is the only platform that provides a fully unified solution for IT, HR, customer service, security operations, and other business functions on a single data model. This eliminates data silos, ensures seamless workflows, and enables enterprise-wide visibility, which is critical for the Department’s mission. Competitors such as Jira Service Management and Zendesk focus primarily on ITSM or customer service, while BMC Helix relies on separate tools and integrations for broader enterprise functions, leading to fragmented workflows. Freshservice and Cherwell, while capable ITSM tools, lack the scalability and enterprise-wide integration that ServiceNow delivers. ServiceNow provides an enterprise scope capability. While other solutions may excel in a specific niche, ServiceNow is the only comprehensive solution that provides the breadth and scope of features required by DHS.

Carahsoft provided DHS with a Source Letter confirming that they are the sole Federal Distributor and GSA MAS Schedule holder for ServiceNow products. As a result, DHS is limiting sources to a single provider to acquire the subject support.

The ten-month period of performance is necessary to maintain continuity of operations while the organization develops and negotiates the future ServiceNow Enterprise License Agreement (ELA). Disrupting the current services or solution could result in operational delays, inefficiencies, or risks to mission-critical functions. Engaging Carahsoft, the sole provider of ServiceNow products and services under the GSA MAS, avoids the costs and time associated with transitioning to another solution for a short-term period. Transitioning away from ServiceNow for ten months would likely result in additional expenses, such as integration and potential disruptions, which would not be cost-effective. DHS needs time to implement the future ServiceNow ELA; and awarding the subject requirement to the sole federal provider of ServiceNow on the GSA MAS provides the Government with adequate time to properly establish the Enterprise License Agreement (ELA).

5. Determination by the ordering activity Contracting Officer that the anticipated order represents the best value consistent with FAR 8.404(d).

The Contracting Officer has determined that issuing the proposed Task Order for ServiceNow products/services for DHS-wide use represents the best value and will result in the lowest overall cost, considering price and administrative costs, to meet the Government’s needs. The GSA MAS products/services have already been negotiated and determined to be fair and reasonable.

If the required support contains any open market items, they will also be determined as fair and reasonable prior to award in accordance with FAR 8.402(f)(2).

6. A description of the market research conducted among schedule holders and the results, or a statement of the reason market research was not conducted.

DHS OPO and OCIO conducted market research to identify commercially available software that provides an integrated suite of applications, workflows and processes to achieve cost savings and modernization for the following functional capabilities: ITSM Pro, App Engine, HRSD, Now Assist. Since October of 2024, DHS OCIO has performed in depth analysis through internet research and verbal discussions and in-person interview. The Gartner online platform was leveraged for research and data points, as well as verbal discussions with Gartner analysts.

Analysis was derived from other web-based locations such as Bloomberg Financial, and Yahoo Finance, Contract and spend analysis were performed based on DHS’s PRISM system, and the Federal Data Procurement System, as well as ServiceNow sales reports. Discussions took place with the DHS Components currently using ServiceNow. DHS OCIO conducted a stakeholder working group with Component stakeholders such as U.S. Immigration and Customs Enforcement (ICE); U.S. Customs and Border Protection (CPB); U.S. Citizenship and Immigration Services (USCIS); Cybersecurity and Infrastructure Security Agency (CISA); U.S.

Secret Service (USSS); Transportation Security Administration (TSA); Federal Emergency

Management Agency (FEMA); U.S. Coast Guard (USCG). In February 2025, DHS OCIO representatives participated in a two-day ServiceNow Federal Forum at the Gaylord National Resort and Convention Center, the Maryland Harbor resort near DC, to discuss ServiceNow’s capabilities with existing customers, IT leaders, and participated in workshops to capture lessons learned and wins from other Federal Agencies. DHS OCIO learned that other entities utilizing the full suite of ServiceNow products were able to show a great return on investment and had a great deal of confidence in the products.

DHS analyzed the availability of cloud-based software solutions that are capable of meeting DHS’s requirements. Other potential software solutions include Atlassian, BMC, Ivanti, ManageEngine, and MicroFocus. These vendors were identified using research mentioned above, as well as reviewing or discussing existing data provided by the Components. None of those companies had products that met all DHS requirements across all the functional requirements.

Additionally, ServiceNow performed a comprehensive evaluation of distributors in support of the federal, state and local market. Their conclusion was that Carahsoft’s size and specialization in the U.S. Public Sector provided a go to market value what was unparallel to other distributors, which resulted in a sole Letter of Supply. ServiceNow has confirmed that status of Carahsoft’s sole Letter of Supply. Carahsoft’s GSA MAS contract contains a list of Participating/Authorized Dealers that may utilize their MAS contract to supply ServiceNow products and services, but ultimately, they are the sole provider. Any purchase for ServiceNow under a GSA MAS contract will be supplied by Carahsoft. Therefore, market research confirmed that Carahsoft is the only available GSA MAS contract holder who can meet the Government’s ServiceNow needs.

7. Any other facts supporting the justification. Additional facts may be stated in this section. If there are no additional facts, you must state that here.

All supporting information is contained in other sections of this justification.

8. A statement of actions, if any, the agency may take to remove or overcome any barriers that led to restricted consideration (i.e., limited sources) before any subsequent acquisition for the supplies or services is made. Include a statement of actions taken or that will be taken to increase competition for future acquisitions of the same item/service (e.g., the government intends to revise overly restrictive technical specifications, acquire data rights, or pursue some other means to increase future competition).

The Government will continue to monitor commercial solution providers for manufacturers of capable products as well as any future authorized distributors for ServiceNow. If another potential source emerges, DHS OCIO will assess if their solutions meet DHS’s capability requirements and have OCIO approval for cloud-based FedRAMP authorized security and sensitivity for controlled unclassified information, in accordance with the OCIO directives and policies. DHS’s plan to conduct ongoing market analysis will determine if there are other fully integrated commercial solutions which will enable a future enterprise agreement to be competitively awarded.

Over the next several months, comprehensive market research will be conducted to identify and evaluate potential vendors and software solutions comparable to ServiceNow. This ensures the selection of a platform that best aligns with the organization’s long-term operational and strategic goals. This research will include engaging with industry partners, reviewing GSA Schedule offerings, analyzing vendor capabilities, and assessing technical, functional, and cost considerations. The time allocated by the subject procurement via Carahsoft is critical to the successful development of the Enterprise License Agreement (ELA), as it allows for a thorough understanding of market trends, vendor performance, and solution scalability. By conducting detailed market research, the organization may mitigate risks, foster competition, and ensure the ELA delivers maximum value, operational efficiency, and alignment with mission requirements.