A02 JA-25-Rock Island EIS-0615_Pega Products_Approved_15SEP2025 REDACTED.pdf

CUI//SP-PROCURE//FEDCON

Control Number: JA-25-Rock Island/EIS-0615

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FAR Part 6 Justification and Approval for Other than Full and Open Competition

1. Requiring Activity: Global Combat Support System – Army (GCSS-A), Fort Lee, VA

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2. Contracting Activity: U.S. Army Contracting Command – Rock Island (ACC-RI) Rock Island Arsenal, Rock Island, IL 61299-8000, Strategic Information Technology (IT) & Cyber Division operating under Army Contracting Command – Aberdeen Proving Ground (ACC-APG) Senior Contracting Official’s authority.

3. Description of Action: ACC-RI intends to award a sole-source Single Award Indefinite Delivery Indefinite Quantity (IDIQ) for Pega Products and Ancillary Services. ACC-RI requests a five-year contract with five ordering periods. This proposed IDIQ will be awarded to Pegasystems Inc. (225 Wyman St Ste 300, Waltham, MA 02451; Cage 42TM8). This IDIQ will cover Pegasystems proprietary software that allows the government to build and deploy applications with minimal coding, streamlining workflows, automating processes, and improving customer engagement. Pegasystems integral to systems like Disconnected Operations (DISCOPS). The contract type is Firm-Fixed-Price (FFP) contract line-item numbers (CLINs). The total ceiling is

ACC-RI will issue the Minimum Guaranteed Quantity (MGQ) Task Order for one-year and six-month (base and a six-month option) FFP for Pega Development Support for DISCOPS at an estimated value is . The task order will be fully funded using FY25 Research, Development, Test & Evaluation (RDT&E) funds.

4. Description of Supplies/Services: This IDIQ will provide Pega Products and Ancillary Services including core software, development support, sustainment & enhancement, Agile execution and Continuous Integration/Continuous Deployment (CI/CD). The proposed IDIQ represents the most cost-effective and efficient solution to address the current and future needs, avoiding the complexities and overhead of multiple individual contracts. The planned IDIQ is for 5 years, which includes five ordering periods.

The Period of Performance (PoP) for the IDIQ will be five years and include 5 ordering periods with a ceiling of

GCSS-Army has a current requirement for Pega support to correct deficiencies, complete the DISCOPS solution, and provide deployment support to the GCSS- Army Product Office. The Project is being executed using the Agile development methodology integrated with DevSecOps practices to address the current backlog of DISCOPS requirements as well as provide defect remediation for issues discovered during the final technical demonstration of the current DISCOPS prototype. Skilled

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6. Reason for Authority Cited: As the OEM, Pegasystems possesses the proprietary knowledge, expertise, and intellectual property necessary to correct deficiencies and deploy the solutions effectively. No other vendor has the capability to meet the Government’s requirements without significant duplication of cost. The Government has determined that soliciting a new developer would not result in better pricing or terms. Pegasystems is unlikely to incur undue risks, as the price and availability of necessary materials and labor are reasonably foreseeable.

a. Background: Pegasystems is a strategic platform for the Army, particularly in areas requiring complex workflow automation, case management, and rules-based decision-making. It's currently integrated into several key systems including DISCOPS, the Defense Civilian Personnel Data System, Army Enterprise Content Management, Integrated Personnel and Pay System – Army, and G-1 Workflow Automation and Security Enterprise Capability. Pegasystems offers a uniquely integrated solution essential for ongoing operations. It's a proprietary platform allowing the government to rapidly build and deploy applications with minimal coding, streamlining workflows, automating processes, and improving customer engagement.

This is particularly important for initiatives like DISCOPS where a rapid solution was needed, and leveraging the existing Pegasystems platform and expertise proved more cost-effective than seeking alternatives. In fact, due to its proprietary nature and unified platform architecture – encompassing Business Process Management, Robotic Process Automation, Customer Relationship Management, and Artificial Intelligence – truly comparable alternatives are limited and would require significant and costly integration efforts with existing DoD systems.

GCSS-Army requires Pega support to correct deficiencies, complete the DISCOPS solution, and provide deployment support to the GCSS-Army Product Office. While the initial maintenance capability has been deployed to a few pilot units, the capability has ~70 defects that need to be corrected. The government does not have the Pega expertise to correct these deficiencies and requires assistance from Pegasystems.

The government also lacks in-house Pega expertise to complete the development for the remaining critical functions in the business areas of unit supply, property accountability, and warehouse management.

The DISCOPS Post Prototype Move to Deployment for GCSS-Army contract (W519TC-24-C-0038) was awarded to Ernst & Young LLP (EY) in September 2024.

Despite multiple extensions granted to EY to deliver the required outputs, the company was unable to meet contractual obligations. In the best interest of the government, it was determined not to extend the contract further or exercise any remaining options. The decision allows for the pursuit of a Sole Source IDIQ follow-on contract to Pegasystems to achieve the program’s objectives. Key justifications include:

Proprietary Technology:

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low-code development, ACM, and AI capabilities. Pegasystems has a long history of working with the Department of Defense (DoD) and federal government, resulting in a deep understanding of their unique requirements and compliance standards. This experience is not readily available from other vendors. Pegasystems has established integrations with key DoD systems (e.g., SAP IPPS-A: Standard Army Personnel Property System) that would be difficult and costly to replicate with alternative solutions. While competitors offer individual components (e.g. Robotic Process Automation tools, Customer Relationship Management systems), no other vendor provides a fully integrated platform with the same capabilities and DoD experience as Pegasystems. Switching to a different platform would require significant and costly integration efforts with existing DoD systems, potentially disrupting critical operations.

The need for a rapid solution to DISCOPS necessitates leveraging the existing Pegasystems platform and expertise. Leveraging the existing investment in the Pegasystems platform and skilled personnel is more cost-effective than developing or acquiring a comparable solution. Switching to another source would create a duplication of costs (as noted in Table 2) without leaving the Army in a better position after competition.

c. Impact if not approved: If the J&A is not approved and the necessary Pegasystems support is not obtained, the Army faces a cascade of potential negative consequences. If the Army were to transition to another solution, the following issues would arise:

• GCSS-Army Disconnected Operations Impairment: GCSS-Army will be unable to fully implement a functional and effective disconnected operations environment.

Without a robust disconnected capability, Soldiers and units may be unable to access critical logistical data (like supply status, maintenance records, or property accountability) when they need it most – specifically when they lack a reliable network connection. This hinders their ability to effectively plan, execute, and sustain operations. The GCSS-Army system supports vital functions like unit supply, property book management, and maintenance. A failure in disconnected operations means these functions are compromised when connectivity is lost, directly impacting unit readiness. Delays or inability to access logistical information can lead to shortages of essential supplies, delayed maintenance, and inaccurate reporting – all of which can increase risk to personnel in the field.

• DISCOPS Program Delay/Stoppage: The DISCOPS program, which relies on the Pegasystems solution, will likely experience significant delays or be stopped altogether. Should an alternative developer be chosen, the DISCOPS solution would necessitate a complete rebuild – effectively restarting the development lifecycle. 38 months of development effort have been invested in building the DISCOPS solution (see Table 3). Based on the existing investment, a conservative estimate to replicate the current DISCOPS functionality with a

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different platform is at least . This is due to the unique configuration, integrations, and specialized logic built specifically within the Pegasystems environment. Re-architecting and re-implementing this functionality represents a significant undertaking, consuming valuable time and resources. A program delay or stoppage directly impacts the Army’s ability to field this vital capability.

DISCOPS is designed to provide essential logistical functionality during periods of degraded or absent network connectivity – a common scenario in contested or austere operational environments. Without DISCOPS, logistical systems remain vulnerable, increasing risk to the warfighter. Specifically, delays or cancellation will hinder access to essential supplies, maintenance support, and accurate, timely information, potentially impacting mission success and increasing force protection concerns.

• Increased Costs: A mandated full and open competition would result in increased costs including extensive proposal evaluations, potential bid protests, and extended project timelines. (See Table 2).

• Duplication of Cost: Seeking another vendor would lead to significant duplication of cost due to Pegasystems’ proprietary knowledge and expertise. To date, $23,220,949.00 has been invested in the DISCOPS solution (see Table 3).

Pivoting to an alternative solution would necessitate a near-complete rebuild, incurring costs estimated at a minimum of

This significant cost is driven by several factors.

Pegasystems utilizes a proprietary rules-based engine and low-code development platform, requiring specialized expertise not readily available in the broader development market. Replicating the existing DISCOPS functionality with a different platform demands not only complete re-architecture and re-implementation of the solution, but also extensive development or customization to achieve comparable capabilities. Beyond the immediate financial burden, a new system implementation introduces complexities including challenging data migration from the existing DISCOPS environment; comprehensive user retraining on a fundamentally different platform; and potential integration issues with critical DoD systems such as NBIS and IPPS-A. Furthermore, the Army risks losing the valuable, specialized expertise cultivated within the team around the Pegasystems platform. Addressing this would require either costly and time-consuming retraining of existing personnel, or the recruitment and onboarding of individuals possessing entirely different, and potentially scarce, skillsets. This represents a significant disruption to program continuity and a potential impediment to successful deployment.

• Loss of Continuity: Without the sole source award, continuity of operations would be jeopardized, potentially increasing risk to the warfighter.

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• Inability to Leverage Existing Investment: The Army would be unable to leverage the existing investment and follow-on procurement from W519TC-24-C-0038.

Seeking an alternative solution would create significant, unnecessary costs to the government without providing any improved outcome. This inability to build upon the existing investment jeopardizes the continuity of operations and potentially increases risk to the warfighter. Abandoning the existing framework of Contract W519TC-24-C-0038 means losing the work already completed and restarting the process.

7. Efforts to Obtain Competition: A Sources Sought was posted 03 SEPT 2025 for Pegasystems Products and Ancillary Services, specifically a DISCOPS solution. In response to the Sources Sought, two vendors - Appian Corporation and IT Partners, Inc. - submitted detailed responses, demonstrating the Army's efforts to assess competition and explore alternatives to a sole-source award. Appian Corporation emphasized its ability to deliver an integrated platform combining Business Process Management (BPM), Robotic Process Automation (RPA), Customer Relationship Management (CRM), Artificial Intelligence (AI), and DISCOPS capabilities. Appian highlighted its operational experience in denied, disrupted, intermittent, and low-bandwidth (DDIL) environments and its proven track record in Army programs such as ACWS and GFIM. Appian argued against the sole-source justification, asserting that its platform meets or exceeds the requirements and offers a faster, more cost-effective, and sustainable solution. Similarly, IT Partners, Inc. requested reconsideration of the sole-source award to Pegasystems, presenting itself as a viable alternative with extensive experience in SAP, Pegasystems, Appian, ServiceNow, and Salesforce. IT Partners emphasized its role as the original integrator for DISCOPS under the Army’s OTA and its ability to replicate the integrated platform on multiple low-code environments. IT Partners also highlighted its cost-saving measures, multi-platform expertise, and ability to avoid vendor lock-in while ensuring continuity and alignment with future modernization efforts. While the responses from Appian Corporation and IT Partners, Inc. demonstrate a competitive market and the Army’s diligent effort to explore alternatives, a transition to either platform at this stage would introduce significant duplication of cost and time.

Considering the existing investment in, and implementation of, the Pegasystems solution, maintaining the current trajectory represents the most cost-effective path forward for the GCSS-A DISCOPS requirement. A sole-source award to Pegasystems minimizes disruption, leverages existing training and infrastructure, and ensures the timely delivery of critical capabilities. Pegasystems is only available through the OEM or authorized resellers on Contract Holding Environment for Solutions and Services (CHESS), General Services Administration (GSA) and NASA Solutions for Enterprise Wide Procurement (NASA SEWP).

a. Effective competition: In an effort to find the most cost-effective, advantageous route for the USG to continue and expand the Pegasystems effort, this requirement is being sole sourced direct to the OEM. It is clear that procuring directly from

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Pegasystems is the most advantageous approach for the government. Direct procurement ensures access to proprietary technology, streamlined support, cost efficiency, reduced risk, and enhanced accountability, all of which are critical for the successful implementation and operation of Pegasystems’s Solutions. Due to the highly specialized nature Pegasystems’s tools, effective competition is limited.

Pegasystems’s solutions are critical to meeting the Government’s requirements and are not readily available from other sources. While other companies offer similar products/services, they lack the capabilities necessary to meet the performance requirements.

b. Subcontracting competition: The Government will require Pegasystems to demonstrate a commitment to maximizing subcontracting opportunities, particularly with small and disadvantaged businesses. The contract will include a clause requiring Pegasystems to provide a Subcontracting Plan, outlining efforts to solicit offers from multiple subcontractors for all available work. The Government will review the proposed Subcontracting Plan to ensure it demonstrates a good-faith effort to obtain competition in its subcontracting activities and will monitor Pegasystems' compliance with the approved plan throughout the contract period.

8. Actions to Increase Competition: The Government will perform ongoing market research of the industry to determine if other Commercial-off-the-shelf solutions exist that may permit future competition of the requirement beyond Pegasystems. Market research is conducted annually to assess changes in the marketplace and identify potential competitors. However, no other vendors have been identified that can meet the Government’s requirements for Pegasystems and the DISCOPS solution without a significant duplication of costs. The Government remains committed to fostering competition and will continue to evaluate the marketplace for future opportunities.

9. Market Research: Market research conducted by GCSS-A and ACC-RI July-through

September 2025 and confirms Pegasystems as the sole vendor currently capable of meeting the Government’s requirements for Pega Products and Ancillary Services including development, sustainment & enhancement that which is required for the DISCOPS solution without a significant duplication of costs.

Initial procurement planning considered the CHESS ITES-SW2 program and identified Pegasystems opportunities available through authorized resellers.

However, ACC-RI received notification on 19 August 2025 of forthcoming guidance from ACC-APG discouraging the use of resellers. Consequently, ACC-RI will not pursue procurement through CHESS ITES-SW2.

10. Interested Sources: Appian and IT Partners Inc are the only interested sources known. To date, no other sources have written to express interest. Pursuing other sources would result in significant cost and time impacts as discussed in Table 2.

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14. Fair and Reasonable Cost Determination: I hereby determine that the anticipated price/cost to the Government for this contract action will be fair and reasonable. This determination will be made using the independent Government estimate as authorized by FAR 15.404-1(b)(2)(iv). As part of the basis, certified cost or pricing data will or will not be required as authorized in FAR 15.403(c)((3)(i)

Conrad Baker Contracting Officer

15. Contracting Officer Certification: I certify that this justification is accurate and complete to the best of my knowledge and belief.

Conrad Baker Contracting Officer

BAKER.A.CONRA

D.1230434359

Digitally signed by

BAKER.A.CONRAD.123043435

Date: 2025.09.10 13:50:10 -05'00'

BAKER.A.CONR

AD.1230434359

Digitally signed by

BAKER.A.CONRAD.1230434

Date: 2025.09.10 13:50:36 -05'00'

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Approval

Based on the foregoing justification, I hereby approve the procurement of Pega Products and Ancillary Services on an other than full and open competition basis pursuant to the authority of 10 United States Code 3204(a)(1) as implemented in Federal Acquisition Regulation 6.302-1(a)(2)(ii)(A), Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements: Supplies may be deemed to be available only from the original source in the case of a follow-on contract for the continued development or production of a major system or highly specialized equipment, including major components thereof, 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. The proposed ceiling is for a five-year IDIQ. This approval is subject to availability of funds, and provided that the supplies and/or services herein described have otherwise been authorized for this acquisition.

Jason E. VanLuven Command Advocate for Competition

ACC-APG

VANLUVEN.JAS

ON.E.12885473

Digitally signed by

VANLUVEN.JASON.E.12885

47374 Date: 2025.09.15 10:31:28 -04'00'