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Data Analytics Grow in Contract Source Selection

The tale of the tape may be changing dramatically for bidders.

Is big data coming to federal contract source selection? Yes, and contractors who master the systems early will reap the big rewards.

An increasing number of procurements are using numeric measures to establish either a competitive range or final awardees. The data points may be aggregated from a variety of variables, and the scoring on those data points will be processed by increasingly sophisticated models that attempt to predict the contractors most likely to succeed on the contract.

While human subjective judgments should continue to have a role, algorithms and dynamic, machine-driven analytics likely will take center stage in the source selection process. Importantly, these analytics will shape not only an offerer’s proposal but also how companies must perform current contracts to maximize their chances for the next award.

A current, early stage example of this trend can be found in the upcoming GSA Alliant 2 governmentwide acquisition contract, or GWAC. The GSA will select 60 large companies and 80 small companies for Alliant 2, which could generate more than $5 billion a year in information technology services task orders from dozens of federal agencies.

To select the winners, the GSA developed a scorecard. Companies receive points for certifications, accounting system compliance, clearance levels, relevant experience, past performance and capabilities in leading -edge technologies such as the Internet of Things and big data. All of the points can be validated through data. There are no adjectival ratings nor subjective judgments. The data drives the evaluation.

The 60th ranked large company and 80th ranked small company set the cut scores. If a firm has more points than the 61st or 81st company respectively, it is a winner. If not, it is a loser. What matters is not the quality of a company’s proposal but instead the relative ranking of a company’s score compared to all the other bidders.

The GSA has used the same approach for professional services, training and building maintenance contracts. With agencies seeking to avoid protests and to award contracts quickly with limited staff, and with more and more data available all the time, we can expect the data-driven evaluation trend to pick up steam in the coming years.

Al Krachman is a Partner at Blank Rome, LLP, and can be reached at krachman@blankrome.com. Brian Friel is a Principal at One Nation Analytics, LLC, and can be reached at bfriel@onenationllc.com.