VCS’ and ILPs

1. VCS’ and ILPs Presented By: Grace Oletski 24 March 2010 Revision #, Date (of revision)

2. Background/Definitions • What Is A Standard? • a. The term "standard," or "technical standard" as cited in OMB Circular No. A-119, includes all of the following: (1) Common and repeated use of rules, conditions, guidelines or characteristics for products or related processes and production methods, and related management systems practices. (2) The definition of terms; classification of components; delineation of procedures; specification of dimensions, materials, performance, designs, or operations; measurement of quality and quantity in describing materials, processes, products, systems, services, or practices; test methods and sampling procedures; or descriptions of fit and measurements of size or strength.

3. Background/Definitions (Cont’d) The term "standard" does not include the following: (1) Professional standards of personal conduct. (2) Institutional codes of ethics. "Performance standard" is a standard as defined above that states requirements in terms of required results with criteria for verifying compliance but without stating the methods for achieving required results. A performance standard may define the functional requirements for the item, operational requirements, and/or interface and interchangeability characteristics. A performance standard may be viewed in juxtaposition to a prescriptive standard which may specify design requirements, such as materials to be used, how a requirement is to be achieved, or how an item is to be fabricated or constructed.

4. Background/Definitions (Cont’d For purposes of this policy, "voluntary consensus standards" are standards developed or adopted by voluntary consensus standards bodies, both domestic and international. A VCS MUST go through a defined process, prescribed by the VCS body, which created a degree of validation that the subject item/process passes ‘muster/scrutiny’.

5. Background/Definitions (Cont’d Voluntary consensus standards bodies are domestic or international organizations which plan, develop, establish, or coordinate voluntary consensus standards using agreed-upon procedures.

6. Background/Definitions (Cont’d A voluntary consensus standards body is defined by the following attributes: (i) Openness (ii) Balance of interest(iii) Due process(vi) An appeals process(v) Consensus, which is defined as general agreement, but not necessarily unanimity, and includes a process for attempting to resolve objections by interested parties, as long as all comments have been fairly considered, each objector is advised of the disposition of his or her objection(s) and the reasons why, and the consensus body members are given an opportunity to change their votes after reviewing the comments.

7. Background/Definitions (Cont’d • Industry Leading Practice • There is no statutory or regulatory definition of Industry Leading Practice • There is no official FAR definition of ILP • Industry and Government have both attempted to define Industry leading practices • T. Ruckdaschel , Deputy Director Property Branch, DCMA HQ • Leading Practices: “Strategies and processes that are both quantifiably and qualitatively demonstrated to be top performing” • E. Frenette, DCMAC-EYE Team Leader • “The most efficient (least amount of effort) and effective (best results) way of accomplishing a task, based on repeatable procedures that have proven themselves over time for large numbers of people”

8. Background/Definitions (Cont’d • AIA defines Industry leading practices: • Industry Leading Practices and Best Practices are methods, processes, or practices about which one or more of the following pertain: • It produces desired results • It leads to exceptional performance • It is recognized by an industry expert or group of industry experts • It is deemed so by an organization’s customers; and/or • It is clearly a new or innovative use of personnel, resources, or technology

9. Background/Definitions (Cont’d Dr. Goetz ‘s definition: Industry Leading practices (ILP) are generally accepted processes, including best practices, that have been proven throughout related business, to be managerially and economically effective, efficient, and successful at meeting particular objectives of a contractor’s management system, and where specified, in compliance with the required Government Outcomes. The ILP should be based on empirical research, evidence and literature pertaining to that business practice, product or system as a ‘leading’ practice. In order for a process to become an ILP, it should be widely used. Generally there should be supporting historical data from an accepted source, e.g., trade publications, literature, etc., to support that process as being repeatable, efficient, measurable and verifiable.

10. Background/Definitions (Cont’d • Working definition: • An ILP needs to be generally accepted • Proven throughout related businesses • Economically effective • Efficient • Supported by data • Deemed an Industry Leading Practice by one’s customers

11. Clarificaton • DCMA is allowing contractors who had an approved and satisfactory Government property control system (under the historical FAR requirements) to use that approved/satisfactory system as an ILP. • Anticipate minimal tweaking and modifying of procedures, practices to become compliant with current FAR requirements • If the processes/system is considered inadequate when tested, DOES NOT SATISFY THE OUTCOME, the GPA may direct a revised system IAW VCS or other documented ILPs.

12. Clarification New contractors with no prior system will have to establish a property control system IAW documented VCS’ and/or ILPs.