eOPF_LSJ_Final_Redacted.pdf

Limited Source Justification FAR Part 8.405-6

1. Agency/Contracting activity:

This Limited Source Justification (LSJ) supports a procurement action to be conducted under the authority of the Multiple Award Schedule Program (FAR 8.401). The procurement action is generated by the Office of Personnel Management (OPM), Office of Procurement Operations (OPO).

2. Nature and/or description of the action being approved:

The U.S. Office of Personnel Management (OPM) Chief Information Office (CIO), Federal Data Solutions (FDS), Data Warehouse Program (DWP) (formerly Enterprise Human Resources Integration ) requires a variety of products and services, to include an integrated suite of commercial-off-the-shelf (COTS) human resources (HR) document management and work flow application (DM/WF) software products and associated development, program management, and data management support services intended to streamline and automate the exchange of Federal employee HR information Government-wide and protect information, rights, benefits, and entitlements of Federal employees.

These services are currently being provided under a two month task order, OPM3216F0001, which expires January 11, 2016 in the total amount of $3,243,000.27. Prior to the current task order, these products and services were provided by Northrop Grumman via a Blanket Purchase Agreement (BPA), OPM32-15-A-0006, issued against their General Services Administration (GSA) Multiple Award Schedule (MAS) Contract GS-35F-4506G in the amount of $4,358,335.

The aforementioned BPA was issued as a logical follow on in accordance with FAR 8.405- 6(a)(1)(i)(C). The period of performance of the BPA was from June 24, 2015 – August 23, 2015. Prior to the BPA, another BPA (OPM1710-A-0001) was issued to Northrop Grumman on a competitive basis as a result of Request for Quote Number RFQ 397455 which covered the period of performance December 23, 2009 – June 23, 2015.

This LSJ provides the rationale for a sole source task order to be issued to Northrop Grumman against their GSA MAS Contract, GS-35F-4506G since they are the only source capable of providing the supplies or services required because the supplies or services are unique or highly specialized. Northrop Grumman’s e.POWER software licenses and supporting services are proprietary in nature and there are no known authorized resellers or authorized service providers available on GSA Schedule.

3. Description of the supplies or services required to meet the agency’s needs (including the estimated value):

The task order resulting from this LSJ will provide the following services: (1) customized, proprietary Northrop Grumman’s e.POWER software licenses; (2) intermittent ongoing lifecycle development and support services, to include software installation, modification, integration, and maintenance; and (3) development, program management, and data management support services. The estimated value of this procurement is approximately

$32,849,102.00 (see table below), and the period of performance is for a twelve month base period with one, twelve month option period.

Services Estimate Development Services (Base Period – 12 months) $3,670,000.00 eOPF Management & Operations (Base Period – 12 months) $3,678,165.00 Data Services (Base Period – 12 months) $1,899,000.00

License Maintenance (Base Period – 12 months) $7,224,100.00 DOE ePerformance (Base Period – 9 months) $127,690.00

DOJ/BOP ePerformance (Base Period – 9 months) $114,455.00 Subtotal (Base Period – 12 months) $16,733,390.00

Development Services (Option Period 1 – 12 months) $3,749,665.00 eOPF Management & Operations (Option Period 1 – 12 months) $3,758,175.00

Data Services (Option Period 1 – 12 months) $1,939,965.00 License Maintenance (Option Period 1 – 12 months) $6,667,907.00

Subtotal (Option Period 1 – 12 months) $16,115,712.00

TOTAL $32,849,102.00

4. Authority permitting acquisition using limited sources:

The authority for establishing the sole source task order resulting from this LSJ is FAR 8.405- 6(a)(1)(i)(B): Only one source 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.

The eOPF is engineered on a customized version of Northrop Grumman’s proprietary e.POWER software platform under a licensing agreement. An attempt to utilize other software at this time would require reengineering of the existing processes migrating from the old platform to a new platform. Most recently, Northrop Grumman and OPM have been engaged in the program development and deployment of a number of eOPF patches, functional enhancements, and security improvements. These include, Oracle Tablespace Encryption, Oracle Network Communication Encryption, Encrypt web.config entries, End to End SSL, Removing SSN from Print Job cover sheets, Encrypting Web Services Output, changing the eOPF New Document Notification email to include less information about the transaction, Input/Edit/Output Masking on SSN, DOB, and Employee ID, a self-service password feature as recommended by the OPM’s Inspector General (IG), and required enhancements to ensure eOPF can continue to be accessed via Chrome, Firefox, and potentially other browsers, to reflect and keep pace with changes to browsing technology.

OPM is also charged by law in Title 5 USC to collect, maintain, and report Federal workforce information. Transitioning to a new vendor would result in a sustained inability to perform these legally required activities. There would also be increased risk to the integrity of the eOPF because a new contractor would experience a significant learning curve, understanding not only the eOPF application but becoming familiar with established best practices to sustain the applications which support the program. Transitioning to a new application could result in data loss, increased costs, increased security risk, increased risk to OPM record management obligations, unavailability of data and images, inability to process retirement claims and background investigations, risk of non-compliance to existing eOPF litigation hold, etc., to a mission critical system utilized by Federal agencies around the world.

If OPM had to precipitously transition to another solution, the result would represent significant application down time as the new application is developed and implemented, which would severely impact daily operations of over 100 Federal agencies that utilize eOPF as well as OPM’s investigations, retirement processing, audits performed by Merit Systems Audit and Compliance, Merit Systems Protection Board decisions, and state court actions for divorce, child support, and bankruptcy. Additionally, operational costs would likely increase due to maintaining current operations while at the same time developing a new application to replace the existing system, since no other system exists which the current eOPF application could migrate to without a significant and prolonged development and testing effort. Additionally, there would be increased costs associated with training HR personnel in 100 Federal agencies as well as retraining technical and business staff in the Data Warehouse Program Operations Team and program management team in order to learn the new solution. Without this critical task order, the DWP is unable to ensure continuity of operations and performance without interruptions.

The most recent BPA was justified as a logical follow on in accordance with FAR 8.405- 6(a)(1)(i)(C) while the present justification indicates Northrop Grumman is the only source capable of providing the supplies or services at the level of quality required because the supplies or services are unique or highly specialized. The reason for the differing justifications is that the Government was not previously aware that Northrop Grumman did not have any authorized service providers for the associated development, program management, and data management support services. The Government was previously under the impression that other vendors would be able to provide the services associated with the proprietary software licenses.

Through the sources sought process for the instant requirement, it was discovered that there are no other authorized service providers and that Northrop Grumman is the only company authorized to provide the support services to its proprietary software product.

5. Determination by the contracting officer that the anticipated order will represent the best value:

Based on the nature of the requirement, the solicitation will be issued to a single source.

Competition will not be sought. In order to determine that the anticipated order will represent the best value, the contracting officer and requesting activity will review previous orders that were competitively awarded and compare the requirement to similar schedules. In addition, technical support personnel will review the level of effort and labor mix proposed.

Pricing will be evaluated to determine if it is a) realistic for the work to be performed, b) reflects a clear understanding of the requirement, c) inclusive of all required services, and d) fair and reasonable. The anticipated task order shall represent the best value to the Government because Northrop Grumman will be required to price the products as well as the labor categories and associated hourly rates within their existing GSA MAS Contract, which have already been determined to be both fair and reasonable in accordance with FAR 8.404(d). Additionally, the vendor will be requested to provide any discounts available beyond the published GSA price.

6. Description of the market research conducted and the results or statement of the reason market research was not conducted:

The most recent BPA that was awarded to Northrop Grumman also included scanning services that were capable of storing, processing, displaying, and archiving electronically digital images. Market research for this new effort has indicated that there are other sources that can provide the scanning services, and as a result it was decided to acquire the scanning services via a separate procurement action. Therefore, the scanning services were not included as part of the current task order and are not included as a part of this instant requirement.

The e.POWER software licenses and associated ongoing iterative lifecycle development and support services, to include software installation, modification, integration, and maintenance are proprietary to Northrop Grumman and therefore, the market research has indicated that no other sources can provide these products and associated services.

Initially, it was unclear if the development, program management, and data management support services could be provided by another vendor. As a result and as part of the market research performed for this present requirement, a sources sought notice was issued via the GPE on August 4, 2015 and closed on August 10, 2015. Aside from Northrop Grumman, all other interested sources indicated that they are not authorized service providers of e.POWER.

In addition, the program office confirmed via e-mail on August 10, 2015 that since eOPF is built on the e.POWER platform, any vendor providing development, program management, and data management for the eOPF program must be authorized by Northrop Grumman to work on e.POWER. Also, Northrop Grumman confirmed via e-mail on August 11, 2015 that there are no authorized service providers. As a result, market research indicates that both the proprietary e.POWER products and associated support services are only available from Northrop Grumman.

7. Other facts supporting the justification.

None.

8. Statement of actions, if any, the agency may take to remove or overcome any barriers that led to the restricted consideration before any subsequent acquisition for the supplies or services is made:

OPM will continue to evaluate the requirement in an attempt to separately compete efforts from the scope of work similar to its recent actions associated with the scanning service requirements, as detailed in Paragraph 6 above.

The eOPF program is currently at a crossroads at which it must decide if the current solution is the appropriate solution or if other alternatives should be considered. As it currently stands, the eOPF program is a form-based paradigm in which documents are imaged and store for retrieval. In the future, the eOPF program plans to evolve to a data-centric approach which leverages the data warehouse and enables collection and aggregation of data which can be rendered and utilized in other applications to better support analytics and reporting.

Accomplishing this will require maintenance of the existing environment and a sustained development effort to transform eOPF from a form-based paradigm to a wholly data environment. This can be accomplished in the following phases:

1. Requirements development

2. Alternatives analysis research

3. IRB Approval

4. Procurement

5. Development, data migration, and testing

6. System Accreditation

7. Deployment and training

The business case will focus on the first two activities. Requirements will address business requirements to develop a technical solution. This will determine new data elements to collect, standardization of the data for reporting, business process rules, metrics, and the user interface. Following the requirements phase, OPM will conduct a thorough alternatives analysis which will include input from the vendor community to determine the best course of action and an acquisition strategy. The alternatives analysis will also evaluate total program costs to include transition and long term maintenance requirements. Finally, the alternative analysis will examine both commercial and government shared service providers. The results will be utilized to address the current restrictions to competition detailed in this LSJ and help identify the program path forward. The alternatives analysis will be presented to the IRB and CIC for action.

The OCIO developed a high level plan and schedule for the creation of a new business case to evaluate future requirements of the next generation of the eOPF. The goal is to move away from document management and toward a data-centric Federal workforce information management system that is integrated with the Enterprise Human Resource Information Data Warehouse to collect and manage Federal workforce information. This plan was initially submitted to the Investment Review Board (IRB) for review on December 2, 2015.

The IRB review unveiled additional complexities and issues that must be addressed concerning collecting and enabling human resources data. To address these issues fully, the timeline for the completion of the Business Case Analysis (BCA) has shifted to 15-18 months, at which time it will be presented again to the IRB for consideration.

9. Certifications/Reviews/Approvals:

Contracting Officer

I hereby certify that the information provided herein to support this Limited Source Justification is complete and accurate to the best of my knowledge and belief.

James C. Thieme Date Contracting Officer

Program Office

I hereby certify that the information provided herein to support this Limited Source Justification is accurate and complete to the best of my knowledge and belief.

Victor A. Karcher, Jr. Date Program Director Data Warehouse Program

I have determined that the information contained herein is accurate and complete to the best of my knowledge and belief.

David Vargas Date Associate Chief Information Officer, CIO/ITSP

APPROVAL:

Juan Arratia Date (Acting) Senior Procurement Executive