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In Contracting, a Desire for Efficiency Can Cloud Clarity

November 2011
By Capt. Joseph A. Grace Jr., USN (Ret.), SIGNAL Magazine

 
The word transparency is used in many different places but with different results. Transparency is what we want in Congress, friendships, relationships and processes, as well as in city council meetings, school board decisions, neighborhood association rules and acquisition strategies. However, in today’s world, very few things are opaque—particularly when it comes to the process of government procurement. What should be an extremely transparent process remains one of the most coveted havens of secrecy, power and waste, and we all pay the price.

A move has been underway recently to put purchasing vehicles in place for organizations to utilize for effective buying. These usually are called IDIQs, or indefinite-delivery/indefinite-quantity, contracts. They effectively cut down the number of eligible bidders on projects to a manageable figure with pre-approved capabilities. Companies spend millions of dollars and thousands of hours of planning time to win the ability to bid and to provide services to these organizations. And, they bet their bottom line on the fact that the organization indeed will utilize this contract vehicle as described in the original request for responses. However, the transparency of that process is what companies count on for success, and the lack of transparency and sudden unexplained changes in this path are what become their undoing.

These contract vehicles—SEWP, DSIDOMS III, T-4, TEAMS, GSA Alliant—cause teaming arrangements to be put in place to cover the array of services that might be required. Each prime holder of those contracts assembles teammates with whom it bids on a variety of projects. A newcomer to the party often must find a partner that holds one of these vehicles. It then must convince the partner that it brings a winning product or service to the team in order to be granted permission to play.

However, if the path to the contract changes, then the arrangements within teammates change too—often at a huge cost of resources, political and personal capital and strained relationships. A buying path that was directed at small business, perhaps to meet quota systems, will cause large integrators and suppliers to line up behind a variety of 8(a), veteran-owned or women-owned small businesses amid a strange division of work share. If at the last minute the contract changes and government selects a different vehicle, these partnerships change. Now the large integrator becomes the prime and has to set up an entirely different set of teaming arrangements—at a huge cost—and may or may not bring the same team to the table. This comes at a substantial price to industry. People are fired; contracts are lost; and the collateral damage to businesses is immense.

If transparency were used instead, then vendors would know the contract vehicle, establish their teams and put the legal paperwork in place to be successful. When the government plays the game of “I have a secret; and it may come out this way; or it may come out that way; or we may just delay it or pull it back,” its actions define the definition of a lack of transparency and serve no one. Sometimes legal requirements, protests or organizational issues drive this change. But usually even those occasions can be mitigated with open communication, a true partnership mentality and the effort to create transparency.

As an example, two very large agencies working together to improve their data sharing issued a contract vehicle that was “won” by 15 different bidders to be “the” vehicle for all procurements. This award was protested immediately for a variety of reasons, which put the process in a state of limbo at the most critical time in the procurement annual cycle.

However, big and small companies alike just do not have the resources to respond in multiple ways at the same time. They need time to prepare and to put the right resources and legal requirements of teaming in place. Instead of making a viable decision as to the path of procurement, this lack of transparency has caused thousands of hours and millions of dollars of wasted time and energy. It is unfair to all concerned.

As a wise old senior chief once said to a newly minted ensign in the submarine force: “Sir, you are paid to make decisions; it would help if some of them were right—but it just doesn’t matter. Make the decisions, and we can all move forward.” In this case and in most other processes of procurement, we are killed by indecision and confusion. Just make the decision.

Capt. Joseph A. Grace Jr., USN (Ret.), is the president and chief executive officer of Grace and Associates LLC and a former chief information officer for Navy Medicine. The views expressed are his own and not necessarily those of SIGNAL Magazine.

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We welcome your comments on this column at http://bit.ly/insignal1011-01, or e-mail us at signalnews@afcea.org .