Thursday, March 26, 2009

The Importance of Following Source Selection Procedures

With protests becoming a more concentrated problem for federal contracts, and contracting activity to significantly increase with Stimulus spending, a recent Government Accountability Office (GAO) bid protest decision is very disturbing. The Obama Administration is putting pressure on agencies to increase competition and best value awards, but the GAO decision demonstrates the need for adequate documentation and justification for not only a best value decision, but making any decision at all.

The GAO decision pertained to a protest launched by Reston, Va.-based Access Systems Inc., challenging a $25.6 million task order for ongoing Marine Corps Systems Command technical and management support which was awarded to Avineon Inc. of Alexandria, Va. Access Systems was the incumbent contractor, and had submitted a lower bid than Avineon.

The Marine Corps' Request for Quote (RFQ) stated that the task order would be issued on a best value basis, where "overall technical merit [was considered] to be of significantly greater importance than evaluated price." But GAO decided the Marine Corps failed to provide necessary justification for the higher price, and thus sustained the protest.

The source selection team for the Marine Corps rated both companies' acceptable for the technical evaluation, with subsequent past performance as low risk. Access Systems and Avineon held comparable technical certifications and both had qualified personnel.

Best value contracts are supposed to be a tradeoff of proposed technical solutions, coupled with prices. However, best value decision often go to the lowest bidder because of the desire to lower costs and the increased pressure from industry of protests. One of the real issues is the inability of the government to understand what truly is in their best interest. This problem is a combination of unskilled personnel, under enormous pressures to move forward with contract actions, in addition to poor processes that are not adequately defined or followed.

The hope is that the pressure from the Obama Administration for greater visibility and transparency will drive agencies to be more diligent in documenting awards and following source selection procedures. Nonetheless, the GAO protest decision is not an isolated case.

Having disciplined, rigorous source selection procedures in place, coupled with adequate training for source selection personnel in how to follow those procedures, will be critical to ensure true best value awards. More importantly, this will also help ensure the government receives the best deal and the best solution. The evaluation criteria need not be overly complex, but must be thorough enough to ensure that critical factors are evaluated and the key determinates are incorporated to differentiate solutions and help with the tradeoff process.

It boils down to having sound evaluation criteria in the solicitation and ensuring offerors understand the criteria of how they will be rated. The government must then be thorough to evaluate proposals only on those criteria, and ensure adequate, precise documentation is the outcome of the process to substantiate an award, mitigate protest risk, and ensure the government does indeed acquire a best value solution.


  1. I would highly recommend that people read the GAO decision. While you have appropriately categorized this under the heading of "administratively following source selection procedures" it is equally insightful as to how the Government formulates its decisions for award. It is quite a document in that regard.

  2. The government often contracts itself into a corner with their processes and gaming by the winning contractor. Best value is fertile ground for playing the game.

    Government Computer News (GCN) carried a story on the difficulties experienced with, "Performance-Based Contracting". The process was made part of the Federal Acquisition Regulation (FAR) in an attempt to pre-establish at contract award those discrete outcomes that determine if and when a contractor will be paid.

    Interestingly enough, the article splits the blame for the difficulties right down the middle, stating the government typically has problems defining what it wants as an end product or outcome and looks to contractors to define it for them. More than willing to do so, the contractors detail specific end products or outcomes, set schedule milestones and submit competitive proposals.

    The winner is selected based on what the government thinks it needs at the time to fulfill its requirement and a contract is negotiated. Once underway, the government decides it wants something else (usually a management-by-government committee with a contractor growing his product or service by offering lots of options).

    The resulting change of contract scope invalidates the original price and schedule, so a whole new round of proposals and negotiations must occur with the winner while the losers watch something totally different evolve than that for which they competed. The clock keeps ticking and the winner keeps getting his monthly bill paid based on incurred cost or progress payments.

    The link to the GCN arcticle is below and is yet another indication of how government keeps getting bigger by incompetency:

    Latch onto the 1980's HBO Movie, "The Pentagon Wars", a humorous but remarkably true story of the design and development of one of the costliest weapons systems ever to grace the Pentagon Budget, the "Bradley Fighting Vehicle". The movie starred Kelsey Grammer as the Pentagon General who led the government establishment sponsoring the vehicle program. The profusion of design and performance specification changes and other difficulties which plagued the program for years was hilariously but accurately portrayed in the film. It was nominated for an Emmy.

    Further details on The Defense Industrial Complex see the following posting: