While Federal Health agencies lean on McKinsey, GSA terminates their schedule contract

“The General Services Administration has terminated the multiple award schedule contract of McKinsey and Company.”

“The company and the agency’s inspector general confirmed GSA’s decision in separate emails to Federal News Network.”

“The decision comes 10 months after a critical inspector general report found McKinsey’s prices were 10% higher than originally proposed, meaning the government paid as much as $65 million in additional costs.”

“The IG recommended at the time to cancel McKinsey’s schedule contract in part because they didn’t cooperate with the pre-award audit.”

“We are disappointed with the GSA’s decision, and that a GSA schedule is not available to our clients at this time,” a McKinsey spokesman said in an email statement. “We attempted to negotiate in good faith and disagree with the GSA’s evaluation. We will nevertheless continue to serve the public sector in the United States.”…”

“…This is the first time GSA canceled a major vendor’s schedule contract since 2012 when it kicked Oracle off of the IT Schedule 70.”

Read the full article here.

Source: GSA terminates McKinsey & Co.’s schedule contract – By Jason Miller, May 19, 2020. Federal News Network.

G2X TAKE: Almost a year after an inspector general report found their prices were higher than originally proposed, attempts to negotiate a resolution appear to have failed as GSA has terminated McKinsey’s multiple award schedule contract. 

If recent history is any indicator, Federal Health agencies are likely to still rely heavily on this consulting firm by leveraging other vehicles, though competitors will be weighing the impact of this action. 

Recent related news

Included below is a snapshot of Prime obligated funds for McKinsey for GSA Schedules IT-70 and 00Corp.  


Federal contracting data provided to G2Xchange by Federal Compass; Date: May 2020


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