Dell's federal contracting with U.S. Citizenship and Immigration Services

Federal Contracting Activities and Contract Types-

Dell Inc.

Dell Inc. was founded by Michael Dell who ventured into business as a freshman at the University of Texas in Austin. He realized that the branded models of computers were expensive and not many could afford them. He ventured into the business of buying the computer parts which he assembled in clones of IBM computers and sold to the consumers directly through the mail. The computer market was already dominated by the big players in the market but against the odds Dell faced competition and emerged the best brand sold through the direct-mail market. Customers recognized the brand through his aggressive marketing and the quality of his computer products that earned him a bigger market share compared to the other little known companies. It became incorporated in 1984 where it has been the world's leading seller of computer systems.

Dell offers a variety of high end electronics for its consumers in the PC market both software and hardware. It has also moved into other consumer electronics and home appliances market where it manufactures high end LED Television sets among others.

The company has maintained the policy of direct selling to its clients through a team of dedicated sales representatives and also online via its interactive website.

The corporation's clients for various products range from small businesses to large businesses, several institutions and government agencies among others. Dell manufactures most of the products it offers to its clients with a big share of the market cutting across several continents and accessing all markets in the world. A bigger percentage of its revenue is generated from the American market which forms two thirds of its sales. The remaining part is shared in different proportions in different markets across the world. (Advameg, 2012).

Dell's quality in the provision of the IT solutions has earned the company a great number of contracts with the federal government supplying various agencies of the government which have different needs. Dell has had a good working relationship with the federal government and has enjoyed more than fifteen years of working experience supplying various agencies with its products and services, where some of its services include; business consulting, IT consulting, managed services and business process among other crucial services to the government.

Contract

One of the major contracts awarded to the company by the Federal government was in the U.S. Citizenship and Immigration Services Bureau. A wholly owned subsidiary Dell Perot Systems won the award which had a total contract value of $120 million. The award expected Dell to process Citizenship and Immigration application at 60 field offices of the U.S. Citizenship and Immigration Services Bureau. This was a contract for three years and as part of the award the contract expected Dell to further provide services in the management of records distribution, file operations, FBI name and finger print checks, oath ceremony scheduling, and file and pending application and petition inventory requirements (Nick Wakeman, 2010).

The type of contract awarded to dell was a fixed price contract. Fixed-price contracts are the contracts which don't have price adjustments by either party. The contract binds the contractor to provide goods and services at the stated predetermined value within a stated period of time. In the case of the federal government the law requires that most of the contracts be fixed-price contracts where the lowest bidder among other bidders who can provide the required services at the predetermined price with the best working history is awarded the contract (Marry Poppendieck and Tom Poppendieck, 2003).

Costs

The costs which are incurred by the contractors are classified into two categories which are either Direct or Indirect costs. Direct costs are the costs which can be tied to the performance of the project and whose costs can easily be traced to specific project. Dell's activities within the contract which can be listed as direct costs include; Salaries of the staff, the cost of materials needed to perform the contract for instance the additional computer components to match the job requirements, Training costs for its employees to perform the job as required by the federal government.

Indirect costs on the other hand are the costs which are incurred by the contractors which are considered not related to one project. These are the costs which are not project specific and whose costs cannot be directly linked to the performance of one particular project. Dell Inc. when discharging the duties as per the project incurred costs which could not be specifically connected to performing the Federal government's contract. These costs included; the Administrative expenses which cannot be pointed out specifically when performing the contract, Maintenance costs for the machines and the security (Accounting for Management, 2012)