oversight

Army ADP Procurement: Contracting and Market Share Information

Published by the Government Accountability Office on 1990-03-01.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

             United   States   General   Accounting   Office
             Fact Sheet for Congressional
GAO          Requesters



March 1990
             ARMY ADP
             PROCUREMENT
             Contracting and
             Market Share
             Information
                   United States
GAO                General Accounting  Office
                   Washington, D.C. 20548

                   Information     Management        and
                   Technology     Division

                   H-23833 1

                   March 1.1990

                   The Honorable John Conyers, Jr.
                   Chairman, Committee on Government Operations
                   House of Representatives

                   The Honorable Frank Horton
                   Ranking Minority Member, Committee on
                     Government Operations
                   House of Representatives

                   This report responds to your February 1989 requests for a comprehen-
                   sive review of federal agencies’ compatible computer procurements1 In
                   your initial requests and in subsequent discussions with your offices, we
                   were asked to answer several specific questions about 35 agencies’
                   procurements of mainframe computers and mainframe peripheral equip-
                   ment. Your questions focused on identifying the extent to which agen-
                   cies’ procurements of mainframe computers and mainframe peripherals
                   required compatibility with International Business Machines (IBM) or
                   any other computer manufacturer. You were also interested in knowing
                   details such as the identification of manufacturers whose equipment
                   was acquired by each agency and the procurement methods used to
                   obtain equipment.

                   In addition to this report on the Army, we previously reported similar
                   information on the Kavy and the Marine Corps.2 Information on the
                   remaining 32 agencies will be reported after we have fully analyzed pro-
                   curement data we collected from them.


                   The information we obtained from the Army shows that during the
Results in Brief   3 l/2 fiscal years ending in March 1989, about 98 percent of the Army’s
                   procurements for mainframes and mainframe peripherals required com-
                   patibility. The Army required IBM compatibility in 427 of its 478 compat-
                   ible procurements (about 89 percent). Of the 51 remaining compatible


                   ‘A wmpatlble procurrnwnt requres hardware or software that functions like specified or existing
                   hardware or software. with little or no modification. Competition in such procurements may occur
                   berween manufacturers and marketers-such as system developers and system integrators-to sup-
                   ply equipment that meets thr compatible requirements. Since there is the potential for competition
                   bet ween manufacturers and marketers, a compatible procurement does not necessarily result in the
                   a%ard of a sole wurce confrirt

                   ‘.2;AVY AUP PROCI!RE:MEXT: (‘ontracting and Market Share Information (GAO/IMTEC-89-66FS.
                   Sept 15, ISRS).



                   Page 1                         GAO,‘IMTEG90-28FS      Contracting   and Market   Share Infomation
E-239331




solicit or obtain comments from the Army on this report. Appendix III
contains additional details on the objective, scope, and methodology of
our work.


As arranged with your offices, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days after
the date of this letter. We will then send copies to the Secretary of
Defense and the Secretary of the Army, and will also make copies avail-
able to others upon request.

This information was compiled under the direction of Jack L. Brock, Jr.,
Director, Government Information and Financial Management, who can
be contacted at (202) 275-3195, should you require additional informa-
tion Other major contributors to this report are listed in appendix IV.




Ralph’V. Carlone
Assistant Comptroller    General




Page 3                  GAODMTEG902SFS   Contracting   and Market   Share Infomti,,n
Figures   Figure I. 1: Number of Army Mainframe and Mainframe
               Peripheral Procurements
          Figure 1.2: Dollars for Army Mainframe and Mainframe
               Peripheral Procurements
          Figure 1.3: Number of Army Compatible Procurements
               According to Type of Compatibility
          Figure 1.4: Dollars for Army Compatible Procurements
               According to Type of Compatibility
          Figure 1.5: Number of Army IBM-Compatible
               Procurements According to Manufacturer of
               Equipment
          Figure 1.6: Dollars for Army IBM-Compatible                                           11
               Procurements According to Manufacturer of
               Equipment
          Figure 1.7: Number of Army Compatible Procurements                                    13
               According to Procurement Method
          Figure 1.8: Dollars for Army Compatible Procurements                                  13
               According to Procurement Method
          Figure 1.9: Number of Army IBM-Compatible                                             15
               Procurements According to Procurement Method
          Figure I. 10: Dollws for Army IBM-Compatible                                          15
               Procurements According to Procurement Method
          Figure I. 11: Number of Army Mainframe and Mainframe                                  17
               Peripheral Procurements According to Manufacturer
               of Equipment
          Figure I. 12: Dollars for Army Mainframe and Mainframe                                    17
               Peripheral Procurements According to Manufacturer
               of Equipment




          Abbreviations

          ADP         automated data processing
          GAO         General Accounting Office
          GSA         General Services Administration
          IBM         International Business Machines, Inc.
          Ih4TFC
              3       Information Management and Technology Division


          Page 5                  GAO/lMTEG90-28FS   Contracting   and Market   Share Information
                                                                     -
                                         Appendix I
                                         Questions and Answers   About
                                         Amy Procurements




Figure 1.1: Number of Army Mainframe
and Mainframe Peripheral Procurements
                                         lmlmotPrcc”nnluM
                                         160     1,.,  -,
                                         140
                                         ,aD=




Figure 1.2: Dollars for Army Mainframe
and Mainframe Peripheral Procurements




                                          Page 7                         GAO/lMTEGSO-28PS   Contracting   and Market   Share Information
                                                                                Appwwlix   I
                                                                                Queetlom and Answers About
                                                                                Army Procurement.8




Figure 1.3: Number of Army Compatible
prnmmwnenis
  _ -   -.   -.
               Arenrrlina
                  . . -.
                          to Tvae of
                           .-   . . -   -   -.   -.   . ._   - -
  ompatibility                                                     .,I--   --
                                                                                160 Nwnbrot~
CC                                                                              140
                                                                                100
                                                                                120
                                                                                ,I0
                                                                                100
                                                                                 P
                                                                                 an
                                                                                 5%
                                                                                 P
                                                                                 60
                                                                                 4a
                                                                                 80
                                                                                 a0




Figure 1.4:Dollars for Army Compatible
Procurements According to Type of
Compatibility                                                                    P aal”YM
                                                                                 70
                                                                                 (0
                                                                                 P
                                                                                 10
                                                                                 30
                                                                                 P
                                                                                 Y
                                                                                  Q




                                                                                 Page 9                      GAO/IMTEWO-29FS   Contracting and Market Share Information
                                         Appendix I
                                         Questions and Answera   About
                                         Army Procluements




Figure 1.5: Number of Army IBM-Compatible Procurements According to Manufacturer of Equipment




Figure 1.6:Dollars for Army IBM-Compatible Procurements According to Manufacturer of Equipment




                                          Page 11                        GAO/IMTEG9028FS   Contracting   and Market   Share Information
                                         Appendix I
                                         Questions and Answers   About
                                         Army Procurements




Figure 1.7: Number of Army Compatible Procurements According to Procurement Method




Figure 1.6:Dollars for Army Compatible Procurements According to Procurement Method
60 LDdllnI” Wlh,




                                         Page 13                         GAO/IMTEG9@28FS   contracting   and Market   Share Information
                                         Appendix I
                                         Questions and Answers   About
                                         Army Procurements




Figure 1.9: Number of Army IBM-Compatible Procurements According to Procurement Method




Figure 1.10: Dollars for Army IBM-Compatible Procurements According to Procurement Method
(0 pd!mxl”Yimam,




                                          Page 15                        GAO/IMI’EGW-2gFS   Contracting   and Market   Share Information
                                         Appendix   I
                                         Questiom and Answers About
                                         Amy   Procurements




Figure 1.11: Number of Army Mainframe and Mainframe Peripheral Procurements According to Manufacturer of Equipment
I,0 N-d--
100
 so
 10
 ID
 (0
 m
 4a
 30
 a0




Figure 1.12: Dollars for Army Mainframe and Mainframe Peripheral Procurements According to Manufacturer of Equipment




                                          Page 17                     GAO/IMTIKXN2SFS   contracting and Market Share Information
Appendix II

Detailed Statistics on Army Procurements


Table 11.1:Armv Mainframe and Mainframe Perioheral Procurements
Dollars in millions
                                    Fiscal Year 1966     Fiscal Year 1967        Fiscal Year 1966          Fiscal Year 196g8                Total
                                    Number Amount        Number Amount           Number Amount             Number Amount                Number Amount
Compatible                              122    $59.4          155      $92 9          153        $76 7               48      $26 1         478    $255 1
Other                                     4      11.0           4        15            -0          00                 3         15          11       14-o
Total                                   126    $70.4          159      $94.4          153        $76.7               51      $27.6         469    $269.1

Compatible    Percent of Total           97%       84%         97%         98%        100%         100%              94%         95%        98%       95%
                                               “Fiscal year 1989 through the second quarter



Table 11.2:Army Compatible Procurements According to Type of Compatibility
Dollars In millions
                                    Fiscal Year 1966     Fiscal Year 1967        Fiscal Year 1966          Fiscal Year 196ga                Total  ~-
                                    Number Amount        Number Amount           Number Amount             Number Amount                Number Amount
Honeywell Bull-Compatible                 3     $9 2            3       si 3            2        $11.8                2       $4 7          10     $34.0
IBM-Compatible                          108     43 0          137       73 4          144         57.8               38       21 6         427      195.2
Unlsys-Compatible                        10      6.9            9         2a            5          6.8                6        0.3          30       16.8
Other Compatible                          1      03             6         84            2          0.3                2        01           11        9.1
Total                                   122    $59.4          155      $92.9          153        576.7               46      $26.1         478    $255.1
                                               aF~scalyear 1989 through the second quarter



Table 11.3:Army IBM-Compatible Procurements According to Manufacturer of Equipment
Dollars in mllllons
                                    Fiscal Year 1966     Fiscal Year 1967        Fiscal Year 1966          Fiscal Year 1969’                Total
                                    Number Amount        Number Amount           Number Amount             Number Amount                Number Amount
Amdahl                                    5    $13 8            6      $21 8              -9      $75          --0             $0 0         20     $43.1
IBM                                      79     189           104       469               92      30 6               30        183         305     114.7
Memorex                                   1       07            2         01              10       17                 0         00          13       2%
Nattonal Advanced Systems                 2       20            0         00               0       0.0                0         0.0          2       2.0
NCR Comten                                6       05            5         16              -~~-
                                                                                           6        7.0               1         0.1         18       9.2
Storage Technolo&     Corporation         8       68           13         16               9       50                 6         2.4         36      158
Other                                     7       03                      14                       6.0                1        0.2          33       7.9
Total                                   106    $43.0      -   13:      $73.4       -1::          557.8               30      $21.0         427    $195.2
                                               aF~scalyear 1989 through the second quarter




                                               Page 19                         GAO/EWIEC9O-28FS           Contracting      and Market   She thfOnt18tiOn
                                            Appendix II
                                            D&a&d    Statistics       on Army Procurements




Table 11.6:Army Mainframe and Mainframe Peripheral Procurements According to Manufacturer of Equipment
Dollars cn millions
                                 Fiscal Year 1986     Fiscal Year 1987            Fiscal Year 1960      Fiscalvearl9G~                   Total   ~~
                                 Number Amount        Number Amount               Number Amount         Number Amount                Number Amount
Amdahl                                 5    $13.8              6          $21.8          9      $7.5             0       $0 0          20~          $43.1
Control Data Corporation               1      a7               5            7.6          0       0.0             0        00             6           16.3
Honevwell Bull                         3      9.2              4            91           2      11.8             2        4.7           11           34.8
IBM                                   79     18.9           104            46 9         92      30.6            31       19.5         306           115.9
Memorex                                1      07               2            01          10        1.7            0         0.0 _--_____-13            25
National Advanced Systems              2       20              0            00           0        0.0             0        0.0           2            2.0
NCR Comten                             7       07              5            16           6        70              1        0.1             19         94
Storage Technology Corporation         a      68              13            16           9       5.0              6       2.4             36         15.8
Unlsys                                 9      69               9.          2.8           5       6.8              5       0.3             28         16.8
Other                                 11       2.7            11            2.9         20        6.3             6       06              48         125
Total                                126    $70.4         ~_____
                                                            159          $94.4         153     $76.7        ~~~r---     $27.6            489      $269.1
                                            '%x4     year 1989through     the second quarter



Table 11.7:Army Mainframe and Mainframe Peripheral Procurements Under the Warner Amendment
Dollars I” millions
_____-..
                                 Fiscal Year 1986      Fiscal Year 1987           Fiscal Year 1968       Fiscal Year 1969’                Total
                                 Number Amount         Number Amount              Number Amount          Number Amount               Number Amount
Compatible                             2      $0.9                7       $11 0           4     $1 4              1              b         14      $133
Other                                  1       8.7                0         0.0           0      0.0              0       $00                1        8.7
Total                                  3      $9.6                7      $11.0            4     $1.4              1              b         15      $22.0
                                            aF~scalyear1989through         the secmd quarter

                                            "Represents    less than $100,000




                                            Page 21                               GAO/lMTEC%O-28FS      Contracting   and Market      Share Information
Appendix     III
Objective,    Scope, and Methodology




In preparing instructions for our questionnaire, we recognized the need
to clearly and consistently identify mainframe computers, as opposed to
superminicomputers and supercomputers. Because technology and mar-
keting strategies change, criteria such as storage capacity, processing
speed, physical size, cooling requirements, and cost do not provide an
adequate basis for clear and consistent identification of mainframes.
Therefore, after consulting with computer vendors, GSA, other federal
 agency officials, and Datapro,’ we considered computer performance,
architecture, and vendor marketing strategy as the basis for classifying
particular computers as superminicomputers, mainframes, or supercom-
puters. Like Datapro, we classified as mainframes some smaller and less
expensive models if they belong to a product line, or family, of main-
 frames sharing a common architecture or operating system. However,
 models with similar performance characteristics which do not belong to
 a mainframe family and are manufactured by companies that are not
traditionally recognized as mainframe manufacturers were not classified
 as mainframes. We provided a list of mainframe manufacturers and
 models in the instructions for our questionnaire as examples of com-
 puters that agencies should include in completing the questionnaire.

We obtained comments on preliminary copies of our questionnaire from
information resources management officials at the Departments of Agri-
culture and Transportation, to aid in ensuring the questionnaire’s clar-
ity. Senior information resources management officials at the Army and
34 other federal agencies were requested to complete the questionnaire
after we incorporated modifications based on comments received from
officials at the Departments of Agriculture and Transportation.

Our questionnaire was furnished to the Army in mid-April 1989. Upon
receiving Army’s initial response in June 1989, the information was
reviewed to determine if the instructions were followed correctly and if
the information was clear and consistent. Although we did not indepen-
dently validate the information supplied in the Army response, our
questionnaire contained several internal checks to determine if inconsis-
tencies were present. In instances where inconsistencies were found, we
contacted Army officials to clarify the data. Following discussions with
Army information resources management officials to resolve questions
about the initial response, the Army supplied a revised response in Sep-
tember 1989. Our work did not include solicitation or evaluation of doc-
uments related to the Army’s individual procurements.

 ‘Datapro is a trade publicatmn that provides detailed information on computers, peripheral equip
 ment, and software



 Page 23                           GAO/IMTEG90-28FS    Contracting   and Market   Share Information
Appendix IV

Major Contributors to This Report


Information            Mark T. Bird, Evaluator-in-Charge
Management and         Peter C. Wade, Evaluator
                       Darlene D. Rush, Evaluator
Technology Division,
Washington, D.C.




(510507)               Page 25                 GAO/IMTEG90-28FS   Contracting   and Market   Share Information
    . ..--   .

       ..
                                                                       .._      ,,,.-    .,.


f
i

;
i                “;i.T;.

A’
                           Requests for copies   Of GAO reports   should be sent to:

                           U.S. General Accounting     Office
                           Post Office Box 6015
                           Gaithersburg,  Maryland     208’77

                           Telephone   202-275-6241

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                           single address.
Appendix     III
Objective,    Scope, and Methodology




In order to obtain information consistent with the questionnaire instruc-
tions, we reviewed the Army’s final response to our questionnaire, and
excluded inappropriate data. For example, we directed the agencies to
include only procurement data for mainframe-related equipment. How-
ever, in some instances, the Army included procurements for computers
other than mainframes. In order to maintain consistency in the statistics
across the 35 federal agencies, any procurements reported by the Army
for equipment other than mainframes and related peripherals were
deleted from our analyses. The figures and tables in appendixes I and II
were developed from our analyses.

We did not solicit or obtain comments from the Army about this report,
however, we discussed our scope and methodology with Army officials
in January 1990. Our review was conducted from February 1989
through January 1990. Discussions were held with Army officials at the
Pentagon. Additionally, meetings were conducted with the Department
of Defense at the Pentagon, and the Department of Agriculture, the
Department of Transportation, and the General Services Administration
in Washington, D.C. Our work was performed in accordance with gener-
ally accepted government auditing standards.




 Page 24                           GAO/IMTEGW-28FS   Contracting   and Market   Share Information
Appendix III

Objective, Scope,and Methodology


               In February 1989 we were requested by the Chairman and the Ranking
               Minority Member, House Committee on Government Operations, to per-
               form a comprehensive review of the government’s use of IBM-compatible
               ADP procurements. In response to the requests and in discussions with
               the Chairman’s and Ranking Minority Member’s offices, we agreed that
               procurements of mainframes and mainframe peripherals would be
               included in our review, with emphasis on compatible procurements. We
               also agreed that our review would cover procurements during the 3 l/2
               fiscal years ending in March 1989, at 35 federal agencies.

               Our primary objective was to obtain and analyze information on specific
               aspects of each agency’s ADP-related procurements. This report focuses
               on the Army and includes the number and aggregate dollar value of the
               Army’s mainframe-related contracts, distribution of procurements
               among equipment manufacturers, and information on use of the Warner
               Amendment in mainframe-related procurements. Additionally, we are
               reporting on the breakdown of various procurement methods the Army
               used to obtain mainframe-related equipment.

               We used the following mutually exclusive procurement methods to
               group the Army’s procurements. The first three methods represent spe-
               cific types of new contracts with mainframe and peripheral equipment
               manufacturers. These consist of sole source new contracts; new con-
               tracts with one offeror that resulted from competitive procedures where
               only one company remained in the procurement at the time the awardee
               was selected; and new contracts with more than one offeror that
               resulted from competitive procedures where the awardee was selected
               from among multiple competitors. We also included a category for new
               contracts with developers and integrators that identified new contracts
               with companies that create systems using equipment manufactured by
               others-except     those contracts separately categorized as awarded to
               8(a) firms. We also obtained and analyzed data on the Army’s modifica-
               tions to existing contracts, use of GSA’S multiple award schedule con-
               tracts, and other miscellaneous procurement methods.

               To accomplish our objective and facilitate the Army’s information gath-
               ering, we designed a questionnaire which, when properly completed by
               the Army, provided us with the necessary information. Our question-
               naire included several charts and provided detailed instructions, with
               definitions and examples, to help the Army identify and report the rele-
               vant information. Our questionnaire instructions cited the Federal
               Acquisition Regulation to ensure consistency in understanding of the
               terms used and to identify key definitions.


               Page 22                GAO/IMTEGW2SFS   Contracting   and Market   Share Information
                                                         Appcmlix U
                                                         Detailed statistics           on Army F%-ocurements




Table 11.4:Army Compatible Procurements According to Procurement Method
Dollars m mullions
                                               Fiscal Year 1986             Fiscat Year 1967               Fiscal Year 1966          Fiscal Year 1969’                Total --
                                               Number Amount                Number Antaunt                 Number Amount             Number Amount                Number Amount
hlmrrr-nntr3rt-cll~
,“.c””       ““IILlYYL   Y”ll
                                S”, CrP0
                                YV”lYI
                                                     7      Gl ?
                                                            _,    .-               a        %O 5
                                                                                            ___                      4        $0.4            1              b         11       $2.2
New Cc&k-One                    Offeror              9           4.9              14        114                     15         6.7            1       $1.4             39       24 4

         _...-.-I                                   20      128                   26        14 3                    21        108            10        16              77       39.5
New Contract-Developer                   or
  Integrator                                         6           0.5              12        176                     41        24.2            6       13.5             65        55.8
New Contract--B(a) Firm                              3           3.5               0              00                 0         0.0            0        00               3         35
Modificatrons tc Existrng
  Contracts                                         21      31 6                  15        40 4                    24        30.2           7        5.6             67        107.8
GSA Schedule Purchases                              51       2.8                 70          55                     35         2.2          16        3.7            172         14.2
Other      --                                       10       2.0                 14          32                     13         22            7        03              44          77
Total                                              122    $59.4                 155        $93-i--~          -i&i        -   $76.7          40      $26.1            470      $255.1
                                                          %scal year 1989 through the second quarter
                                                          %presents            less than $100,000



 Table 11.5:Army IBM-Compatible Procurements According to Procurement Method
  Dollars in mullions
                                               Fiscal Year 1986             Fiscal Year 1987               -Fiscal Year 1988         Fiscal Year 198ga                 Total
                                               Number Amount                Number Amount                   Number Amount            Number Amount                Number Amount
  New Contract-Sole              Source              1                  b          1                   h             4        $0 4             1              b         7        $0.4
  New Contract-One               Offeror             7       $1 4                 13       $11 4                    12         2.7             1      $1 4             33        169
   New Contract-More                Than One
     Offeror                                        17           11.2             23          126                   21        10.8            8         15             69        36 1
   New Contract-Developer   or
     Integrator                                      6            0.5             10          102                   41        24 2            6        13.5            63        484
   New Contract-E(a)   Frrm                          2            33               0           00                    0         0.0            0-        0.0             2         3.3
   Modrfrcatrons to Exrstrng
     Contracts                                      18      22.8                  12        32 4                 21           16.8            5      0.9               56        72.9
   GSA Schedule Purchases                           50       2.8                  69         55                  34            2.2           14 ~-   3.7              167        14.2
   Other                                             7       IO                    9          13                 11            07             3          b             30         3.0
   Total                                           108    Q43.0                  137       $73.4                144          $57.8           30    $21.0              427     $195.2
                                                           aF~scal year 1989 through the second quarter

                                                           bRepresents less than $100,000




                                                           Page 20                                         GAO/IMTEGSO-28FS          Contracting   and Market      Sham Information
Appendix 1
Questions and Answers   About
Amy proearements




To what extent has the Army procured mainframe computers and main-
frame peripheral equipment under the Warner Amendment?

The Army statistics showed that it conducted 15 procurements for
mainframe computers and mainframe peripherals, representing $22 mil-
lion in obligations, under the Warner Amendment. Of those 15 procure-
ments under the Warner Amendment, 14 were compatible procurements.
Those 14 procurements represented $13.3 million in obligations.




Page 18                         GAO/lMTEG90-28FS   Contracting   and Market   Share Information
Appendix I
Questions and Answers   About
Army Procurements




What equipment manufacturers are involved in the Army’s mainframe
and mainframe peripheral procurements, including both procurements
where compatibility is required and procurements with no compatibility
requirement?

IBM was the most active supplier of mainframe and mainframe periph-
eral equipment to the Army in each of fiscal years 1986 through 1988
and for the first half of fiscal year 1989, with 306 out of 489 total
procurements. Additionally, using obligated dollars as the measure, the
Army’s obligations for IBMequipment during the same 3 l/2 year period
were $115.9 of a total of $269.1 million. Amdahl, NCR Comten, and Stor-
age Technology Corporation are IBM-compatible equipment manufactur-
ers that were also involved in supplying equipment to the Army. Aside
from these IBM-compatible manufacturers, Control Data Corporation,
Honeywell Bull, and TJnisys equipment was supplied to the Army during
the 3 l/2 years.




Page 16                         GAO/IMTEGW28F-S   Contracting   and Market   Share Infommtion
Appendix I
Questions and Answers   About
Army Procurement.9




What procurement methods were used to obtain IBM-compatible main-
frame computers and mainframe peripheral equipment? And, did the
Army frequently use new contracts with 8(a) contractors to obtain IBM-
compatible mainframes and mainframe peripherals?

The Army most frequently used GSAschedule purchases as the procure-
ment method for obtaining IBM-compatible equipment. However, modifi-
cations to existing contracts accounted for more dollar obligations than
any other procurement method. New contracts with companies desig-
nated as 8(a) firms by the Small Business Administration were used by
the Army on two occasions to obligate $3.3 million of the $195.2 million
total obligated for IBM-compatible procurements.




Page 14                         GAOJMTEGSO-ZSFS   Contracting   and Market   Share Information
Appcmlix I
Questions and Answers   About
Amy Pmcluements




What procurement methods were used to obtain all types of compatible
mainframe computers and mainframe peripheral equipment? And, did
the Army frequently use new contracts with 8(a) contractors to obtain
compatible mainframes and mainframe peripherals?

Using the number of procurements as a measure, GSA schedule
purchases were the most frequently used method of obtaining equip-
ment when the Army identified compatible requirements. However,
when measured using obligated dollars, the Army performed most
procurements that required compatibility by modifying existing con-
tracts. New contracts with companies designated as 8(a) firms by the
Small Business Administration were used by the Army in 3 of 478 com-
patible procurements. All three of the 8(a) contracts were in fiscal year
1986.




Page 12                         GAO/IMTEG90-28FS   Contracting   and Market   Share Information
Appendix I
Questions and Answers   About
Amy PIwcmments




What equipment manufacturers are involved in the Army’s IBM-compati-
ble mainframe and mainframe peripheral procurements?

The Army obtained IBM equipment in most of its IBM-compatible procure-
ments in each of fiscal years 1986 through 1989 (through the second
quarter). Of the 427 IBM-compatible procurements, 305 resulted in the
Army obtaining IBMequipment. Similarly, of the $195.2 million obligated
to IBM-compatible procurements, $114.7 million was for procurements
involving IBMequipment. Amdahl, Memorex, National Advanced Sys-
tems, NCR Comten, and Storage Technology Corporation were among
those manufacturers involved in the remainder of the Army’s IBM-corn-
patible procurements.




Page 10                         GAO/lMTEC%O-28ES   Contmwtine   and Market   Share Infonoation
Appendix I
Questions and Answers   About
Army Procurements




What is the distribution of the Army’s compatible mainframe and main-
frame peripheral procurements according to type of compatibility?

Those procurements that the Army identified as having a compatible
requirement were for either Honeywell Bull, IBM,Unisys, or some other
type of compatibility. Specifically, 427 of the 478 procurements were to
satisfy IBM-compatible requirements representing $195.2 million of
$255.1 million obligated for all compatible procurements. Also, Unisys-
compatible requirements represented 30 of 478 procurements and
$16.8 million of the obligations. While only 10 of the Army’s compatible
procurements were to meet Honeywell Bull-compatible requirements,
they accounted for $34.0 million of the $255.1 million in obligations. The
remaining 11 compatible procurements required compatibility with a
variety of other hardware or software and represented obligations of
$9.1 million.




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Appendix I

Questions and Answers About
Army Procurements

              What are the numbers and dollar amounts of the Army’s mainframe and
              mainframe peripheral procurements requiring compatibility and is there
              any trend toward the increased use of compatible procurements?

              The Army initiated a total of 489 procurements and obligated a total of
              $269.1 million for mainframe computers and mainframe peripherals
              during the 3 l/2 fiscal years ending in March 1989. The Army statistics
              showed that compatible procurements comprised 478 of the Army’s 489
              total procurements, representing $255.1 million of the $269.1 obligated.
              In each year of the 3 l/2 fiscal years ending in March 1989-using the
              Army’s number of procurements as a measure-the percentage of com-
              patible procurements versus other procurements was about 94 percent
              or higher. For the same time period, the percentage of dollars obligated
              to compatible procurements versus other procurements was about 84
              percent or higher in each year. Since the Army’s statistics indicate a
              consistently high percentage of compatible procurements, there was no
              trend toward increased compatible procurements.




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Contents


Letter
Appendix I                                                                                                        6
Questions and
Answers About Army
Procurements
Appendix II                                                                                                   19
Detailed Statistics on
Army Procurements
Appendix III                                                                                                  22
Objective, Scope, and
Methodology
                                         .-
Appendix IV                                                                                                   25
Major Contributors to
This Report
Tables                   Table 11.1:Army Mainframe and Mainframe Peripheral                                       19
                             Procurements
                         Table 11.2:Army Compatible Procurements According to                                     19
                             Type of Compatibility
                         Table 11.3:Army IBM-Compatible Procurements                                              19
                             According to Manufacturer of Equipment
                         Table 11.4:Army Compatible Procurements According to                                     20
                             Procurement Method
                         Table 11.5:Army IBM-Compatible Procurements                                              20
                             According to Procurement Method
                         Table 11.6:Army Mainframe and Mainframe Peripheral                                       21
                              Procurements According to Manufacturer of
                              Equipment
                         Table 11.7:Army Mainframe and Mainframe Peripheral                                       21
                              Procurements 1:nder the Warner Amendment




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B-2.38331




procurements, the Army required that 40 have Honeywell Bull or
Unisys compatibility’ (about 8 percent) while 11 required some other
type of compatibility (about 2 percent). When the Army’s procurements
required IBM compatibility, IBMequipment was supplied in 305 of those
427 IBM-compatible procurements (about 71 percent). Furthermore, IBM
was the manufacturer that most frequently supplied equipment for the
Army’s mainframe and mainframe peripheral procurements overall,
including both compatible and other procurements where no compatibil-
ity was required. When we used dollars for comparison-as opposed to
the number of procurements-we      found that in each fiscal year cov-
ered, the Army obligated more dollars to (1) IBM-compatible procure-
ments than to any other type of compatible procurement and (2) IBM
than to any other equipment manufacturer.

As requested in discussions with your offices, we also obtained informa-
tion from the Army on the procurement methods it used, including the
Army’s use of contractors that participate in the Small Business Admin-
istration’s program for small disadvantaged businesses-known         as 8(a)
contractors. Additionally, we collected information on the Army’s
procurements performed under the Warner Amendment (10 U. S. C.
2315), which exempts the Department of Defense from General Services
Administration (GSA)oversight when procuring certain military-related
automated data processing (ADP) resources. The detailed questions you
asked and our answers are summarized in appendix I. Appendix II con-
tains tables with detailed statistics that are the basis for our answers to
your questions.

We agreed with your offices to collect and report information for the
3 l/2 fiscal years from October 1,1985, through March 31,1989. All the
information we are reporting is based on the Army’s response to a ques-
tionnaire we devised and distributed to the 35 agencies. We did not inde-
pendently validate the information, which the Army supplied in June
 1989, nor did we evaluate any documentation related to individual
Army procurements. However, we checked the Army’s information for
consistency with the instructions for our questionnaire and, in Septem-
ber 1989, the Army clarified and revised the original information it pro-
vided after we questioned several items. At your request, we did not

3Since several companies manufacture and market IBM-compatible equipment, competition in IBM-
compatible procurements may occur among a variety of manufacturers and marketers. However,
there are few if any companies that manufacture equipment compatible with Honeywell Bull or
Unisys. As a result, competition in procurements requiring Honeywell Bull or Unisys compatibility
generally occurs only between the manufacturer of the required equipment and companies marketing
that manufacturer’s equipment



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