Contract savings ideas range from innovative to old-school

Wednesday - 11/30/2011, 6:49pm EST

Steve Kelman, professor of public management, Harvard University's Kennedy School of Government

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By Jack Moore
Federal News Radio

It's no secret agency budgets are set to get even tighter.

But there are obvious places for managers to start trimming, such as the contracting shop.

Steve Kelman, a professor of public management at Harvard University's Kennedy School of Government and the former administrator of the Office of Federal Procurement Policy, joined In Depth with Francis Rose to discuss how agencies can cut costs through contracting.

Kelman tackled the same issue in a recent column for Federal Computer Week, highlighting contracting savings ranging from "Nobody's ever done this before" to ideas "So old, they're getting new again."

One completely new idea is for agencies to ask potential bidders during the draft request-for-proposal stage for ways the RFP could be tweaked that would save the government money. Contractors would be assigned points for ideas that are eventually adopted in a final RFP. Thus good money-saving ideas offered by contractors increase that contractor's chances of being awarded the contract.

On the other end of the spectrum — old ideas ready for a renaissance — Kelman cited the use of value engineering, which he called in his blog post a "hoary technique." This tactic involves contractors suggesting money-saving ideas during the actual performance of a contract.

Kelman said there is something for nearly all contracting officers in proposals — even the most risk-averse.

"Different people and different organizations have different appetites for risk and for being the first person on the block to try something new," he explained.

But by throwing these ideas out there, though, Kelman said he also hoped to get federal contracting officers thinking of their own innovative ideas.

"I've got a bunch of ideas, but everybody should be coming up with ideas on this," he said. "This should be part of what we do."

In fact, thinking creatively about contracting savings is enshrined in the Federal Acquisition Regulation, the government's procurement bible, Kelman said

"In part one of the FAR, it says that if something is not forbidden by the FAR, a statute or executive order or whatever, and it's in the interest of the government and the mission, then you should consider that the idea is allowed," Kelman said.