Improving Source Selection and Reducing Protests in an Age of Austerity

1. Improving Source Selection and Reducing Protests in an Age of Austerity Professor Steven Maser Atkinson Graduate School of Management Willamette University Salem, OR 97301

2. Fundamentals of the Source Selection Process

3. Fundamentals of the GAO bid protest process

4. Rules Governing Contracting • FAR and DFARS • Bid Protest Mechanism • Alternative dispute resolution • ‘Fire-alarm’ for violating rules

5. Contracting in the Shadow of Bid Protests • Incentivizes agencies to design and operate source selection processes that are: • Transparent in terms of compliance • Effective in terms of achieving agency mission • Fair in terms of access to contracting opportunities

6. Nine findings and recommendations • Sources of information • 30+ interviews • Statistical analysis of bid protest decisions at GAO and COFC 2001-2009 • Government contracts data: FEDMINE.US (www.fedmine.us) FPDS (www.fpds.gov) FedBizOpps (www.fbo.gov)

7. One • Finding • Risk, including risk of a bid protest, is inherent in selecting a source • Recommendation • Institutionalize risk management in source selections sources

8. Two • Finding • Agencies do not provide sufficient information to vendors • Recommendation • Increase agency transparency by documenting and disclosing

9. Three • Finding • Agency practices can be perceived as biased • ed • Recommendation • Mitigate perceptions of bias with clear,justifiable, documented procedures

10. Four • Finding • Smaller companies generate most of the protests and larger companies protest more strategically • Recommendation • Hold vendors accountable for their protest decisions protest decisions

11. Data

12. Three

14. Five • Finding • More complex source selections generate more protests • Recommendation • Simplify requirements

15. Six • Finding • Training for the source selection workforce is not adequate • Recommendation • Invest in training the source selection workforce

16. Seven • Finding • Government human resource management systems do not always reinforce workforce motivation • Recommendation • Create incentives to excel on source selections

17. Eight • Finding • An agency’s decision-making structure can create conditions conducive to bid protests • Recommendation • Align decision-making authority with agency strategy and information

18. Nine • Finding • Monitoring the success of source selections can be misguided and time-consuming • Recommendation • Agencies should monitor more, monitor smarter

19. Achieving strategic objectives in contracting • Ensure that program, contract, and functional (e.g., IT, CFO, HR etc) staff agree on the strategic goals to be achieved in the procurement—before writing a word • Consult with industry (extent determined by available time) on how best to achieve that goal—both substantively and what contracting strategy to use • Write RFP to require offerors to indicate alignment between proposed solution and strategic goals—how will their approach achieve the specific ends sought, with line of sight • Set clear performance goals (see finding 7)

20. Achieving strategic objectives in contracting (continued) • Base selection criteria more than minimally on how well this alignment is demonstrated • Align decision-making process to ensure program input into reviews (finding 9) • Train contract staff in program outcomes for the topic at issue, not just how to do a good contract (finding 6) • Make a concerted effort to strip RFPs of all non-useful process, and allow incorporation by reference for documentation that has already been submitted—so that offerors spend time on the proposed strategic solution, not process

21. Recent developments and trends • Number of Docketed Protests up 2% in FY 11 over FY 10; FY 10 up 16% over FY09  • Congressional Expansion of GAO Protest Jurisdiction • Task Orders Under ID/IQ Contracts (147 protests in FY 11; 6% of total) • Competitive Sourcing/A-76 (zero in FY 11 because of moratorium)  • "2012 Hot" Protest Topics • Conflicts of Interest • "Best Value" analyses • Agency Not Following Evaluation Factors • Down-select/exclusion of offerors • Protest Sustain Rates Lowest (16%) in 5 years • Based on protestor obtaining some form of agency relief   • Corrective Actions Dismissals Up • Corrective Action challenges also up

22. Future Potential Issues • DoD Legislative Initiative to Align GAO and COFC jurisdictions • Growth In Lowest Price Technically Acceptable (LPTA) evaluations and awards • What impact is it having on source selection mechanics and protests? • What other source selection techniques are being used? • Can government in-sourcing actions be protested? • Will sequestration (if it happens) change the protest landscape? • What will be the 2013 "hot" protest topics?

23. Resources • ABA Section of Public Contract Law (2012), Services Contracting Best Practices: A guide to successful services contracting. • Bid Protest Statistics FY07-11: www.gao.gov/assets/590/586259.pdf • Melissa Copeland (2011) Guide to State Procurement • Kate M. Manuel and Moshe Schwartz Congressional Research Service (6/30/11) GAO Bid Protests: An Overview of Time Frames and Procedureswww.fas.org/sgp/crs/misc/R40228.pdf • Steven Maser, The Bid Protest Process at GAO: Six Conundrumshttp://govcon.net/bid-protest-process-gao-six-conundrums/ • Steven Maser (2012) Improving Government Contracting IBM Center for the Business of Government http://www.businessofgovernment.org/report/improving-government-contracting-lessons-bid-protests-department-defense-source-selections

24. Questions? • Steven M. Maser, Professor of Public Management and Public Policy, Atkinson Graduate School of Management, Willamette University, smaser@willamette.edu • Thanks to: • Dan Chenok, Executive Director, IBM Center for the Business of Government chenokd@us.ibm.com • Alan Chvotkin, Executive Vice-President and Counsel, Professional Services Council chvotkin@pscouncil.org