OMB busting contract myths

Monday - 2/7/2011, 7:27am EST

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As produced by Meg Beasley

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By Meg Beasley
Federal News Radio

The Office of Management and Budget is on a mission to reform contracting - they are going myth-busting. Administration officials say lack of communication between industry and government creates barriers to good contracts, but agencies are hesitant to talk to contractors.

OMB released a memo Wednesday kicking off an initiative to address agency concerns and increase effective government-industry communications. It identifies common "myths" about vendor engagement that may be unnecessarily hindering dialog. It also provides facts and strategies to help acquisition officers benefit from industry's knowledge and insight.

The memo requires agencies to submit a vendor communication plan that discusses how the agency will reduce barriers, publicize communication opportunities, and prioritize engagement opportunities for high-risk, complex programs or those that fail to attract new vendors during recompetitions. The plans are due to OMB by June 30.

The memo coincides with OMB's announcement that contract expenditures declined over consecutive years for the first time since 1997.

Dan Gordon, administrator of the Office of Procurement Policy (OFPP), said communication has been a problem throughout his more than 20-year career in government contracting.

"It's my experience that poor communication is too often the cause of costly problems," Gordon said in a phone press conference Friday. "Poor communication between the government and industry, and especially not enough listening on the government's part. Not enough communication from industry to government."

Gordon said industry often is the best resource for information about new technologies and innovative strategies. Agencies miss out on this knowledge or design faulty contracts because they aren't comfortable having frequent, informal conversations with vendors.

"Listening to industry early on can help ensure that we're not buying out of date technology and that our solicitation isn't setting unrealistic expectations," said Gordon. "Sometimes we're trying to get too much by way of performance or have unrealistic schedule or cost estimates."

Gordon said the current Federal Acquisition Regulations (FAR) allows for broad communications but agencies don't understand the rules.

"We have substantial flexibility under the current statutes and regulations," said Gordon. "We're not using the flexibility we have. We don't believe we need statutory change or regulatory change. What we really need is cultural change. This memo is an effort to tell our people what they can do, not just what they mustn't do."

The memo addresses 10 myths:

  1. "We can't meet one-on-one with a potential offeror." Government officials can generally meet one-on-one with potential offerors as long as no vendor receives preferential treatment.

  2. " Communication with contractors is like communication with registered lobbyists - it must be disclosed. This additional disclosure burden means we should avoid these meetings." Most contractors do not fall into the category of requiring disclosure. Even when they do, it is a minimal burden that should not prevent useful meetings from taking place.

  3. "A protest is something to be avoided at all costs - even if it limits conversation." Restricting communication won't prevent a protest, and actually might increase the chances of a protest.

  4. "Conducting discussions after receipt of proposals will add too much time to the schedule." Avoiding discussions solely out of schedule concerns could be counterproductive, and may cause delays or other problems during performance.

  5. "If the government meets with vendors, that may cause them to submit an unsolicited proposal that delays the procurement process." Submission of such a proposal is separate from the process for a known agency requirement and should not affect the schedule.

  6. "When government awards a task or delivery order using the Federal Supplies Schedules, debriefing isn't required so it shouldn't be done." Providing feedback is important, both for offerors and the government, so agencies should provide feedback whenever possible.

  7. "Industry days and similar events attended my multiple vendors aren't valuable to agencies or vendors because industry won't provide useful information in front of competitors, and the government doesn't release information." Well-organized industry days, as well as pre-solicitation and pre-proposal conferences are valuable opportunities for the government and vendors.

  8. "The program manager already talked to industry to develop the technical requirements, so the contracting officer doesn't need to do anything else before issuing the RFP." Technical requirements are only part of the acquisition; getting feedback on terms and conditions, pricing structure, performance metrics, evaluation criteria, and contract administration will improve the award and implementation process.

  9. "Giving industry only a few days to respond to and RFP is okay since the government has been talking to industry about the procurement for over a year." Providing only short response times may result in the government receiving fewer proposals and the ones received may not be as well-developed, which can lead to a flawed contract. It also signals that the government isn't really interested in competition.