S03_JA Turbonomic_Redacted.pdf

Control Number VA-24-00051674

JUSTIFICATION

FOR AN EXCEPTION TO FAIR OPPORTUNITY

1. Contracting Activity: Department of Veterans Affairs (VA)

Office of Procurement Acquisition and Logistics Technology Acquisition Center 23 Christopher Way Eatontown, NJ 07724

2. Description of Action: The proposed action is for the issuance of a firm-fixed price (FFP) delivery order under the National Aeronautics and Space Administration (NASA) Solutions for Enterprise-Wide Procurement (SEWP) V Government-Wide Acquisition Contract (GWAC) for the renewal of brand name IBM Turbonomic Application Resource Management (ARM) Subscription Licenses.

3. Description of the Supplies or Services: Department of Veterans Affairs, Financial

Services Center (FSC) has a requirement for IBM Turbonomic Application Resource Management (ARM) On Prem Managed Virtual Server Subscription License(s). The quantity is for a total 1800 Virtual Server Subscription licenses that will simultaneously optimize performance, compliance, and cost in real time.

Each workload license is required per server per year being monitored. IBM Turbonomic ARM Subscription Licenses provide actionable insights to improve performance, stay compliant with VA business policies and eliminate waste. The software manages the complete application stack, automatically. Applications get exactly the resources they need, continuously, all while satisfying business constraints.

The period of performance shall be August 1, 2024 through July 31, 2025 with two 12-month option periods. The total estimated value of the proposed action is inclusive of the option periods.

4. Statutory Authority: Pursuant to Federal Acquisition Regulation (FAR) Subpart 16.505(a)(4), the following brand name requirement is being justified and approved as an exception to fair opportunity under the statutory authority of Section 41 U.S.C. 4106(c)(2) as implemented by FAR Subpart 16.505(b)(2)(i)(B), entitled “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”.

5. Rationale Supporting Use of Authority Cited Above: Based on extensive market research, as described in Section 8 of this justification, it was determined that limited competition is viable among authorized resellers of brand name IBM Turbonomic ARM Subscription Licenses. FSC currently has IBM Turbonomic in use.

IBM Turbonomic Control Number VA-24-00051674

The software communicates through a source code that is based on IBM Turbonomic proprietary data. No other software can provide this communication capability without this source code. Without interoperability, VA FSC will effectively need to develop entirely new solutions or workflows that allow for communication between different tools in the software stack. Replacing IBM Turbonomic would carry a significant risk of disruption to business operations, require substantial training and adjustment periods, and require a large upfront capital investment to purchase new software as well as other supplemental costs.

The estimated cost for a new solution, including software, initial labor costs, training, administration, configurations and customization would be approximately and at least a year of implementation/configuration. Turbonomic is unique in its capability to right-size or auto-scale environments in both on-premise and cloud environments based on resource consumption generating cost savings for the FSC. Replacing IBM Turbonomic poses a significant risk of disruption and would require substantial upfront costs for new software, training, configuration, and customization to meet FSC requirements. A different solution would require multiple products to provide the same capabilities Turbonomic currently provides.

Additionally, the required software must be compatible in all aspects (form, fit and function) with existing systems presently installed/performing. IBM Turbonomic’s primary purpose is to maximize application performance in real-time and at scale, which subsequently minimizes costs. IBM Turbonomic supports a hybrid architecture across on-premises and cloud from a single control plane rather than disjointed toolsets. It also visualizes full stack relationships and dependencies for any environment, anywhere. IBM Turbonomic integrates with any application environment through agentless, API-driven discovery, at every layer of the application stack. This includes 40+ out-of-the-box integrations with open source and third-party solutions. Without IBM Turbonomic, the VA has no ability to pull and gather performance data that is currently used by the FSC. Any substantial breakdown in VA processing systems would directly affect VA’s ability to serve Veterans. Specifically, VA could experience a technical issue which would cause a work stoppage that would delay disability claims for tens of thousands of Veterans.

IBM Turbonomic is proprietary and not opensource, therefore, it is required for use within the FSC servers to allow access to the current data used by the VA.

6. Efforts to Obtain Competition: Market research was conducted, details of which are in Section 8 of this justification. This effort did not yield any additional sources that can meet the Government’s requirements. However, the undersigned VA technical representative determined that limited competition is available among authorized resellers for brand name IBM Turbonomic resellers. In accordance with FAR 16.505(a)(4)(iii)(A)(1), this justification will be provided with the solicitation to all appropriate NASA SEWP V GWAC holders. In accordance with FAR 5.301, 16.505(b)(2)(ii)(D), and 16.505(a)(4)(iii), notice of award of the resulting order will be synopsized on the SAM.gov Contract Opportunities website and this justification will be made publicly available within 14 days of award.

7. Actions to Increase Competition: The Government will continue to conduct market research to learn if there are changes in the marketplace that would enable future actions to be competed.

8. Market Research: VA technical personnel conducted market research in February 2024 researching websites for products comparable to the IBM Turbonomic subscription licenses. Specifically, the Government's technical experts conducted web-based research on similar products such as Dynatrace, Datadog, AppDynamics, and VMWare Aria Operations. The results of the market research confirmed that only IBM Turbonomic subscription licenses has the capability of providing software solutions that are compatible and interoperable with the existing FSC infrastructure and IBM Cloud Paks Managed Virtual Server.

Additionally, none of these other software products could meet VA’s interoperability and compatibility requirements as outlined in paragraph 5 of this document. Based on the above, only IBM Turbonomic subscription licenses can meet all of the Government’s requirements.

As a result of the above, the Contract Specialist conducted additional market research in April 2024 by utilizing the NASA SEWP V GWAC Market Research Tool by searching for the provider listed within the Product Description. The search revealed that there are 18 contract holders that are resellers for the brand name IBM Turbonomic including 4 SDVOSBs, 4 VOSBs, 1 Historically Under-Utilized Business Zones, 4 Women-Owned Small Businesses, 11 Small Businesses, and 2 Large Businesses.

On April 19, 2024, the Contract Specialist emailed an IBM representative asking if the subject solicitation was issued as a SDVOSB Set-Aside, would a SDVOSB reseller be able to comply with the limitations on subcontracting and certify against VAAR 852.219-75 VA Notice Of Limitations of Subcontracting – Certificate of Compliance for Services and Construction (JAN 2023) (DEVIATION). On April 22, 2024, the IBM representative stated that “IBM cannot provide pricing to our resellers for an SDVOSB Set-Aside solicitation due to the Non-Manufacture Rule.

However, if the solicitation is released as Full & Open, IBM and our SDVOSB partner resellers can respond”. NASA SEWP resellers under Groups B1 (SDVOSBs), B2, C and D are exempt from the NMR due to the contract level assigned NAICS Code 541519, Information Technology (IT) VAR, which is a service code and therefore exempt. However, IBM’s concern relates to the requirement under NAICS 541519 (IT VAR) footnote 18 which states 15% to 50% of the value of any effort using 541519 must be for value added services; therefore IBM will not provide pricing if the solicitation is issued as a SDVOSB/VOSB set-aside.

Based on the above, there is not a reasonable expectation that competition exists amongst SDVOSB, VOSB or any other socio-economic group resellers if the RFQ was issued as a set-aside. Accordingly, the subject solicitation shall be issued unrestricted for consideration of quotes from NASA SEWP V Prime Contract holders listed under Groups B1- Historically Underutilized Business Zones Small Businesses, B2-SDVOSBs, C-Small Businesses and D-VARs on the NASA SEWP V GWAC under the NAICS code 541519.

9. Other Facts: None

10. Technical/Requirements Certification I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

11. Fair and Reasonable Cost Determination

I hereby determine that the anticipated price to the Government for this contract action will be fair and reasonable based on anticipated limited competition. Additionally, NASA SEWP V has already determined the prices on contract to be fair and reasonable and more competitive pricing may result from competition. Finally, the successful quote may be compared with the Independent Government Cost Estimate.

12. Contracting Officer Certification/Approval

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

Approval

In my role as procuring activity Advocate for Competition, based on the foregoing justification, I hereby approve the acquisition of the renewal of brand name IBM Turbonomic ARM Subscription Licenses on an other than fair opportunity basis pursuant to the authority cited in paragraph 4 above, subject to availability of funds, and provided that the property and services herein described have otherwise been authorized for acquisition.