Current Trends in Engaging with Industry during Acquisition Planning

2. Current Trends in Engaging with Industry during Acquisition Planning Breakout Session #402 Name: Evelyn Gibbs Victor Chambers Date: Tuesday, July 20, 2010 Time: 10:30am–11:15am 1

3. Objectives/Purpose of Briefing • Discuss activities associated with engaging industry (market research) during the acquisition planning phase of source selection • To demonstrate ways to improve process and communication with better results

4. FAR Part 7 governs acquisition planning requirements for federal procurements • Acquisition planning incorporates several key tenants to include: • Developing a clear understanding of and defining program needs • Performing an assessment of operational needs • Selecting the appropriate acquisition methods Market research is a critical aspect of this process

5. Things I would do to buy a car Determine market value Kelley Blue Book Edmunds Auto trader New vs Used Determine Reliability and Maintainability Consumers Reports Survey Current Owners Test Drive Investigate competitors Develop a scoring criteria to choose the best choice for me Things I would do to buy a candy bar Buy it Market Research is the common sense thing we do every day in our everyday lives.

6. Market Research is a tool used to determine what is available on the market to meet a specific need you as a buyer or requiring activity have to meet your organizational goals and objectives and determine the terms and conditions customarily used in the commercial market for the item or service being procured. What is Market Research? The data resulting from market research are analyzed and used to make informed decisions about whether an organization’s needs can be met by commercial products or services, making . commercial market items particularly important to market research. When making informed decisions, several factors are considered : • Degree to which commercial practices allow the products or services to be customized or tailored to meet the organization’s needs • Terms and conditions, such as warranties, discounts, and customer support, under which commercial sales are made • Ability of potential suppliers’ distribution and logistics support systems to meet the organization's needs.

7. Market surveillance Strategic planning Tool Conducted as a continuing, ongoing activity, and not isolated to specific acquisitions Captures current knowledge of changes, advances and trends in technology and products of interest Valuable to support determinations regarding industry capability, product availability, competitive market forces, and use of alternative sources Market surveillance data should be considered and utilized in both short and long term acquisition planning Various methods employed to perform market surveillance. Industry conferences or trade shows Activities to become familiar with market trends, product or service advances, delivery capability, product or service pricing, and new companies Market Investigation Tactical activity In-depth understanding of a market. Answers specific questions about the market, suppliers, products, services to shape the acquisition strategy. Builds on the ongoing strategic market research, Determents sources of commercial item Various methods employed to perform investigations. Posting information and requests to a industry accessible web page Request for Information (RFI) Sources sought synopsis through the FedBizOpps Industry conference There are two types of Market Research, Market Surveillance and Market Investigations

8. FAR Part 10 Federal statutes found in the United States Code (U.S.C.)—41 U.S.C. 253a(a)(1), 41 U.S.C. 264b, 10 U.S.C. 2377, and 15 U.S.C. 644(e)(2)(A)—and implemented by FAR Part 10, Market Research, require agencies to conduct market research under the following circumstances: Before developing new requirements documents for an acquisition Before soliciting offers for acquisitions with an estimated value in excess of the simplified acquisition threshold Before soliciting offers for acquisitions with an estimated value less than the simplified acquisition threshold when adequate information is not available and the circumstances justify its cost Before soliciting offers for acquisitions that could lead to a bundled contract On an ongoing basis, and to take advantage to the maximum extent practicable of commercially available market research methods, to identify the capabilities, including the capabilities of small businesses and new entrants into Federal contracting, that are available in the marketplace for meeting agency requirements in furtherance of a contingency operation or defense against or recovery from a nuclear, biological, chemical, or radiological attack. Market Research is not optional, the FAR requires it driven by FASA and Clinger-Cohen FAR Part 12 Acquisition of Commercial Items, requires that market research be conducted to determine the availability of commercial items or nondevelopmental items that could meet the requirements. This regulatory guidance implements the Federal Government’s preference for the acquisition of commercial items contained in Title VIII of the Federal Acquisition Streamlining Act of 1994 (Public Law 103-355).

9. In early phases, both strategic and tactical market research shape the acquisition strategy, requirements definition, support and test plans, product description, statement of work, evaluation factors, and contract terms and conditions. At Milestone B, allows comparison of users’ requirements to the commercial capabilities For each solicitation, market research can be used to identify the correct set of performance characteristics (system specification, commercial item description, statement of work, or statement of objectives), the appropriate solicitation and contract terms and conditions, and the commercial practices affecting the support strategy and the acquisition strategy in general Practitioners need to be informed at all stages of the development lifecycle, so market research is conducted throughout the lifecycle SD-5 Market Research Defense Standardization Program Office

10. Organizations are gathering analytical data Pilots Live test demonstrations. Acquisition Wargaming Gathers targeted data that could be used in source selection Helps to separate “marketing” from application Integrated with Traditional approaches Bidder Conferences Request for Information Draft Proposal Sources Sought Synopsis Although regulations and policy define what questions must be answered, innovative methods of engaging industry are available

11. Plan PlanPlan Innovative approaches take time to collect the objective data and feed it into the decision process Surge staffing may be required to evaluate data New issues arise (i.e. legal questions about prototype ownership) Demonstrations and tests require investment funding before a milestone review can approve Commercial vs Development Multiple awards vs Single Award Technology Maturity Cost vs Fixed Fee Where to enter the system development lifecycle? Cost Data Is the budget adequate? Resource constrained schedule Upgrade path Evolutionary Block upgrades P3I Validate Requirements Advanced planning and a well defined objective are key to executing these innovative market research approaches

12. Build a simple “easy-to-use” PC-based system for emergency managers to geo-target alerts Implement system in a limited number of field offices and their respective emergency management operations centers. Chose 5 deployment field sites Develop Federal and State/Local client systems Deploy system to Federal and State/Local sites Develop documentation as required Develop system requirements for program office operations The following example is an application of a pilot to validate requirements

13. Weather Observations Forecast Model Dispersion Model Collaboration Server System Server System Clients System Client Operational Network State Agency Federal Agency System Provides Emergency Manager a Easy to use Tool • System provides information the emergency manager needs to quickly identify the public that is at risk; • Uses a simple graphical user interface for system managers; • Provides collaboration tools, so the EM can work with the experts at a field offices or other locations to clarify the information that is being presented; • Provides standards based interface to disseminate the message to the public. FEM

14. Plume simulations are conducted to exercise the application and make sure participants have the appropriate training to use the tool after installation; If the pilots show the tool is of value then the plan is to continue to develop the application until it becomes incorporated into the standard operational suite of software for the field office forecasting tool Initial customer feedback from initial pilot locations are positive and leadership supports continued deployment Customers Provide Feedback for a Better Product FEA

15. Innovative Method: Acquisition Wargaming Case Study

16. In 2007 a major defense organization stood up a New Program Office (NPO) which was responsible for synchronizing five major contracts with three contractors for the execution of program requirements. The NPO was tasked with: Synchronization and execution all development, integration, and fielding activities related to the program Serve as the single Program Manager responsible for ensuring that all requirements and objectives for operating in the overall system architecture were met Responsible for program cost, schedule and technical performance The NPO must oversee all program contracts and resources and ensure full “end-to-end” integration Three contractors are working under five contracts awarded and managed by various offices within the defense organization Company B’s system build contract is managed by the Ground office Company B’s design and construction contract is managed by the Sites office Company R holds two contracts with the Sensors office for subsystem build and system staging Company R holds one contract with the USACE for site preparation A Consortium - with Company L as the Prime holds an Other Transactions Agreement (OTA) with the Communications office for C2BMC Scenario

17. The NPO was adopting a new synchronization strategy where all industry partners will share the responsibilities traditionally held by a single Lead Systems Integrator (LSI) The NPO synchronization strategy will seek to incentivize all industry members to work as a team towards shared success Instead of relying upon an LSI to ensure full integration of all technical elements into the larger system, the synchronization strategy requires the “Industry Team” to take collective responsibility for technical integration and to work together to address challenges Government Lead Systems Integrator Subcontractor Subcontractor Subcontractor The accomplishment of a synchronized execution strategy entailed the implementation of a new acquisition model Traditional LSI Model New Synchronization Strategy Government Industry #1 Industry #2 Industry #3 “Industry Team”

18. The wargame series included two wargames and representation of key government and industry stakeholder perspectives Wargame I: Government only with surrogate industry participation (i.e. former industry representation) Wargame II: Industry Leadership with Government Stakeholders Strategic simulation “what if” exercises were employed These are “what if” situations – as in the real world, we never have all the information we want to make a decision These were simplified versions of reality – they are not intended to represent all aspects of a complex world The scenarios are intended to be plausible not predictive Acquisition Wargaming was employed to validate the proposed acquisition strategy

19. Acquisition Wargaming was used to validate the proposed strategy Goals of the Acquisition Wargame • Red Team” Contract Synchronization Strategy • Test interwoven set of prime contractors to reinforce cooperative behavior in service of an end-to-end capability • Test individual contractors’ and/or Agency principals’ ability to advantage themselves and disadvantage others • Test government’s ability to speak with “one voice” as the system’s integrator • Strengthen business CONOPS based on synchronized execution strategy decision rights, information flow and potentially, technical baseline development • Identify major risks to program synchronization and develop risk mitigation strategies

20. Two wargames were conducted and included representation of key government and industry stakeholder perspectives Wargame I: Government only with surrogate industry participation (i.e. former industry representation) Wargame II: Industry Leadership with Government Stakeholders The wargames employed strategic simulations or “what if” exercises These are “what if” situations – as in the real world, we never have all the information we want to make a decision These were simplified versions of reality – they are not intended to represent all aspects of a complex world The scenarios are intended to be plausible not predictive The acquisition wargame was constructed similar to that of a “traditional” wargame

21. The Strategic Simulation design allows stakeholders to interact as they would in the real life environment • Foreign Governments • Congress/White House • Press • All Others Control Team Interaction • Acquisition • Operations • IA • Engr • Test • Finance • General Counsel Functional Stakeholders* NPO Collaborate Coordination/Deconfliction Industry • Sites and Facilities Office • USACE Communications Office Sites Office Ground Office Sensors Office * Organizational Element Teams • Assess environment • Take actions • Collaborate with others • Brief decisions to all • Control Team • Oversee exercise • Introduce external stimuli • React for those not represented • Assess impact of actions • Industry Participation • In Strategic Simulation I, industry teams will be composed of “surrogates” representing the interests of the key industry players

22. Teams worked to a very tight schedule in each move to make decisions, interact, brief actions, and assess impacts ILLUSTRATIVE MOVE DECISION CYCLE 30 minutes 2.5 hours 60 minutes 30 minutes Introduction Stakeholder Actions Stakeholder Briefings Impact Assessment Control team briefs instructions to all- and presents opening scenario. At the start of the 2nd Move, Control provides a scenario update Stakeholders develop/update their strategies and take actions—communicating with other teams via email . Control team assesses the impact of the Stakeholder actions – and briefs its feedback to all Each Stakeholder team briefs its actions/strategies and rationale for the move to all in a plenary session. Scenario Update Feedback after each move

23. Develop a deeper understanding of the synchronization strategy across the USG Test the USG’s ability to speak with “one voice” Identify ways to strengthen) business Concept of Operations (CONOPS) in terms of decision rights, information flow, and baseline development Identify major risks to program synchronization and develop risk mitigation strategies Lessons Learned… Implementation of Acquisition Wargaming enabled the test and “red team” the US government’s execution synchronization strategy and exposed areas which may require further refinement Objectives Key Issues • What are the key elements of the synchronization strategy? • Who are the key stakeholders required for decision-making and successful execution of the strategy? How do we properly incentivize roles and responsibilities? • What information is required to support decision-making? What coordination is required? • What is the definition of “done”? Who decides? • How can the business CONOPS be improved to enhance effectiveness (cost and operational)? How can the USG enhance its ability to speak with “one voice?” • What are the major risks to synchronization and how can they be overcome?

24. Questions and/or Comments

25. Evelyn Gibbs Booz Allen Hamilton, Business Analytics Ms. Gibbs has been with Booz Allen for over 7 years working on Contracting Policy, Research, and Source Selection for the Military and Civil Agencies, such as Navy, DHS, DISA, and Missile Defense Agency Ms. Gibbs is a Certified Federal Contracts Manager (CFCM), a Certified Commercial Contracts Manager (CCCM) and a member of NCMA Contact: Gibbs_Evelyn@bah.com Vic Chambers Booz Allen Hamilton, Business Analytics Mr. Chambers has been with Booz Allen for 4 years working as an Acquisition subject matter expert with the Civil Agency clients, primarily DHS Mr. Chambers is a certified Project Management Professional (PMP) and DAWIA Level III certified in Program Management and Systems Engineering Contact: Chambers_Victor@bah.com Bio