Politicians and Protests Don't Mix

blog.theodorewatson.com

According to language included in the National Defense Authorization Act (NDAA), which passed out of the House Armed Services Committee on April 30, Congress is seeking answers to the recent surge in protests the last few years.

The NDAA has a provision instructing Defense to commission a study regarding how Defense contractors are using the protest process in their favor, or simply manipulating the system.

I believe the Government Accountability Office (GAO) has already addressed these issues in their latest report to Congress (here). Also troubling is the desire to use a Federally Funded Research and Development Center for this analysis, which is a troubling potential contracting issue in and of itself.

Allow me to answer the commission's questions and save the taxpayers untold millions:

The issues this “commission” is tasked with analyzing include: 

(1) If contractors who currently have a DoD contract enter a bid protest to delay the implementation of new contracts that would draw business away from the old one. The Government Accountability Office has up to 100 days to review a bid protest and render a decision.

I have had only one contractor be candid with me about it, but of course you are going to protest in this situation as the incumbent! Honestly, what do you have to lose? You lost the contract, and that is 3 extra months of revenue. What is the downside? Some would argue bad faith, strained customer relations, etc. Ninety more days of revenue trump these concerns, especially in this cutthroat, hyper-competitive government contracting market. 

(2) The extent to which companies file a bid protest even when they do not believe the Defense Department made an error in order to delay or otherwise disrupt the process.

I call these protests “sour grapes,” and no attorney worth their salt will admit to them, since the attorneys, in my opinion, are the only ones that win here. Some firms just get bad legal advice, other firms may just not know any better.

However, I have had several companies tell me that these protests were filedsimply because the risk averse contracting community is not providing enough information in the debrief process to give contractors confidence in the contract award decision.

Therefore, these protests are filed in hopes of digging up some dirt, and ultimately exerting pressure on the Contracting Officer for the ultimate goal of the protest and the third issue;

(3) Whether there are net benefits for companies filing a protest or indicating they plan on filing a protest.

The statistics show that this is the real path to protests, getting another bite at the apple in some form or fashion through corrective action. 

This effectiveness rate, which held steady at 43 percent of all cases filed last fiscal year, and as reported by the GAO, is the important figure. Nearly half of all protests ended by having the protested agency take some action. Those are pretty good betting odds.

This corrective action might take the form of pulling and rewriting objectionable parts of the solicitation, brokering with the protestor to win work with the winning contractor, or reevaluating the losing contractor's proposal.

The buying environment is creating the protests pressures on both sides, and the continued lack of communications and collaboration with industry by government exacerbates the issues. Further, many firms use protest after protest as part of their contract development strategy, with little consequence since the protest process is ripe for abuse. 

We do not need Congress to waste money on reports and committees that provide little useful information. Instead, taxpayers would be better served by properly resourcing government management and demanding accountability for results.