Customer Training

1. Customer Training Acquisition 101: Developing the Requirements Package What you need to know to be successful… Presented By: NAVSUP FLCPH Regional Contracting Office Service with AL HA! FY 19 The NAVSUP Enterprise

2. Regional Contracting Department • Responsibilities • Solicit, negotiate, award and administer non-construction contracts and purchases for fleet, JBPHH, and regional customers . • Exercise an unlimited procurement warrant. • Assist in defining requirements via market research. DID YOU KNOW? The default font for this template is HELVETICA. Call NMCI if you don’t have it and they will install it for you. Text should be blue. https://www.navsup.navy.mil/navsup/ourteam/navsupgls/navsupflcph/whatwedo/contracting

3. Goals • Educateour customers on the contracting process – • Provide a simplified understanding of procurement • An informed customer is our best customer. As an activity generating requirements, it is critical that you understand your role in helping us meet your requirements and accomplish your mission • Defineexpectations – • Identify the Customer’s and the Contracting Officer’s individual responsibilities within the context of procurement execution • Sharelessons learned and best practices – • Combine our synergistic efforts to improve our effectiveness in supporting the Warfighter

4. Why is this course important? DID YOU KNOW? The default font for this template is HELVETICA. Call NMCI if you don’t have it and they will install it for you. Text should be blue. • To ensure your requirements are met and to prevent a loss of effectiveness and a waste of US tax payers dollars…or worse, a loss of life…

5. Course Overview • In this course we will cover: • Acquisition Process • Procurement Administrative Lead Time • Customer Responsibilities • Defining the Requirement • How to Conduct and Document Market Research • How to Develop the IGE • Basics of how to write a Performance Work Statement • Acquisition Planning • DD 254 Security • What Not To Do: Anti Deficiency and UACs • References and Tools • Question and Answer • Course Evaluation DID YOU KNOW? The default font for this template is HELVETICA. Call NMCI if you don’t have it and they will install it for you. Text should be blue.

6. Acquisition Process Evaluation/ Source Selection Post Award Administration Buyer Market Research Solicitation Contract Execution/ Award Cancellation Policy 5 Days

7. Procurement Administrative Lead Time (PALT) • NAVSUPs goal is to process routine purchase requests within specified cycle times • Depends on estimated dollar value, contract type, and sourcing decision, etc. • “Clock” starts once FLC has received a complete & workable RCP Package • Generally…. • Simplified acquisitions under $250K (POs) 30 Days+ • Modifications 30 Days+ • Orders (IDIQ, FSS, IDC, Seaport-e, GWAC) 60 Days • Large Contracts > $250K: 120-300 Days • * Note that these figures are based in part on the AVERAGE lead time….

8. Cancellation Policy CANCELLATION POLICY In the event further information is required to process your requirement, FLCPH will contact the point of contact identified on the purchase request. The following plan will apply to all requests for information. This plan provides the buyer/contract specialist and the customer established periods for obtaining necessary information. This will ensure that FLCPH has sufficient time to support all customers without spending undue time on unnecessary calls. Step One: Day One, requisition contains incomplete information. Contract Specialist notifies customer and requests the additional information. Step Two: Two (2) working days later if the information is still not received, Contract Specialist again requests information from the customer. Step Three: Two (2) working days after Step Two follow-up. If customer has not provided required information, cancel requisition and send all documentation back to customer. Plan your work – work your Plan! Good Contracting cannot save a poorly defined planned or funded program!

9. Additional Things to Consider PALT Planning Additional Things to Consider • For services that require CACs, background investigations, and/or security clearances, allow 60 days for “ramp” time before start date • Sole source actions do not take less time than competitive actions • “Better Buying Power” initiative to promote competition (30 day extension to solicitation if competition not achieved (i.e. 1 offer) • Thresholds for additional acquisition side reviews (e.g., peer reviews) & additional customer side reviews will result in longer processing times • ERP Funding issues can also take longer

10. Leveraging Capacity Leverage Our Capacity • HOW CAN YOU HELP BETTER LEVERAGE OUR CAPACITY? • Stagger/Move annual service renewals away from 1 Oct start time • Share/coordinate large dollar value, complex, and service contract • requirements early with Contracting Department • Provide prioritized list of potential end of FY requirements early • Schedule/get training early from FLC on procurement package prep • Maximize use of the purchase card • Obtain requirements through the Supply System or Navy Corridor of • FEDMALL wherever possible • Assist us with Leveraging Buying Power via Strategic Sourcing • - Consolidate “like” requirements across your Command • - Mandate “strategically sourced” contract use Better leveraging capacity during FY = Expanded capacity at year-end

11. Customer Responsibilities • The customer is responsible for: • Defining the requirement • Planningahead for your requirements by allowing adequate contract administrative lead-time and pre-coordinating with appropriate contracting POC. • Completing market research • Developing adequate purchase descriptions, specifications, Statements of Work, or Performance Work Statements • Developing Independent Government Estimate (IGE) • Providing proper justification when restricting competition or seeking special contractual actions • Submitting a complete procurement request package to include sufficient funding. • Perform timely follow-up and quality assurance actions • Actively participating in the acquisition process • Avoiding unauthorized commitments • Remember…you have a significant role in the process!

12. Defining the Requirement • The process starts with adequately identifying, defining, and detailing your procurement needs and anticipated scope . • FAR Part 11 specifies that when describing agency needs, acquisition of supplies or services should be stated in terms of • a) functions to be performed, • b) performance required, or • c) essential physical characteristics. • Supplies: You should have all possible information relating to that product (nomenclature, material, operating characteristics, dimensions, color, etc.) an explanation of its desired functionality, and data regarding the end user’s need. • Service: You should be able to specify the required support, estimate the duration of need, and outline desired (measurable) results. • These specifications will facilitate obtaining the best possible services and maximizing the outcome.

13. Purchase Request (PR) • Also referred to as the requirements document, funding document, or request for contractual procurement (RCP) • Types: NAVCOMPT 2276, DD 1149, MIPR, ERP • Always check the Line of Accounting (LOA) and verify that funding has been certified! • Ensure your Product Service Code (PSC) matches the Object Class Code (OCC) • PR Minimum Requirements • Document number • Adequate purchase description • Quantity and unit of issue • Product Service Code • Delivery information • Unique requirements • Price estimate • Funding • Inspection and Acceptance • Point(s) of Contact • Approvals/Signatures • PR/RCP Packages • Sole Source/Limited Source/Impact Statement • SOW/PWS • Market Research • MOPAS • ITPR • Lease vs. Purchase • IGE

14. Market Research Overview • MR is critical in describing agency needs, developing acquisition strategy and identifying terms/conditions/ industry practices • Provides information on existing products; capable small businesses; competitive market forces; product performance & quality; and successful acquisition practices of other organizations Importance of Market Research Customer MR should answer basic questions 1) What do I want to procure? 2) Where can I get the product or service? 3) How much is going to cost the government? 4) Availability in the marketplace/industry. Customer MR Objective 1) If you have it, use it! 2) If you don’t have it, see if another agency has it! 3) If another agency doesn’t have it, acquire it! Mandatory Sources

15. Market Research (FAR 10) • The extent of market research will vary, depending on such factors as complexity, urgency, estimated dollar value, & past experience. • Failure to conduct market research can result in: • Sub-optimum descriptions of requirements • Protests of sole source or limited competition acquisitions. • GAO could order re-competition and payment of bid and proposal costs. • Contract Administration Problems • The government could miss out on the newest & best technology or services.

16. Market Research Continuous process of collecting & analyzing information about capabilities within the market to satisfy agency needs Suppliers’capabilities Product characteristics Market estimates MARKET RESEARCH Surrounding business practices Plus the analysis of that data to make acquisition decisions Socioeconomic opportunities • Market Research is the sum of two processes + • Surveillance • Investigation

17. Mandatory Sources Overview • IAW FAR 8.002 all agencies shall satisfy requirements for supplies and services through government sources except as required by FAR 8.003 or otherwise provided by law or other regulation. • Each purchase request must contain evidence that screening for mandatory Government sources of supply has been accomplished. • As a general rule, the customer will screen wholesale supply sources as they screen agency inventories. Where Can I purchase Goods and Services? • Non-Mandatory Sources • (Per FAR Part 8.004) • Supplies: • Federal Supply Schedules (GSA) • Government-Wide Acquisition Contracts • Blanket Purchase Agreements • Federal Strategic Sourcing Initiatives Agreements • Services: • FPI • Commercial Services in the Open Market • Required Sources • (Per FAR Part 8.003) • Supplies(in descending order of priority): • Inventories of requiring agency • Excess from other agencies • Federal Prisons Industries (UNICOR) • Non-profit Agencies Employing People who • are Blind or Severely Disabled (AbilityOne) • Wholesale Supply Sources (GSA) • Services • AbilityOne * Note: If agency is unable to satisfy requirements for supplies & Services from mandatory list they are encouraged to use the non-mandatory sources

18. Gathering Market Research Data Product/Service Characteristics Source Capabilities Business Practices; Terms/Conditions; Laws Supportability/ Sustainment • Availability • Technology • Specs/Standards • Integration/Open Systems • Impact • Quality Assurance • Market Prices • Services • Competition • Size (SBs) • Production • Distribution • Geographic location • Support • Program Management • Warranties • Financing and Discounts • Marking and Packaging • Inspection and Acceptance • Price data • Insured/Bonded/ Licensed • Govt Leverage • Payment Terms • Obsolescence • Life cycle and cycle time • Equipment • Technical Data • Parts availability • Impact of Replacement Items

19. Market Research • Market research sources and techniques: • Knowledgeable industry and Government experts • Historical acquisitions for similar or identical requirements • Government databases • Internet searches • Sources Sought/ Request for Information • Source lists • Markey surveys • Industry days • Contractor catalogs, trade journals, line cards, data specifications, product brochures, advertisements, conferences • NAVSUP Market Research Link: https://www.navsup.navy.mil/cks/referencelibrary(Search Engines) • NAVSUP Strategic Sourcing Link: https://www.navsup.navy.mil/portal/page/portal/nss e • The National Acquisition Center Contract Catalog Search Tool: http://www1.va.gov/nac/ • Federal Procurement Date System-Next Generation (FPDS-NG): https://www.fpds.gov/fpdsng_cms/index.php/reports

20. Market Research Example • Buying a new car: • Look at brochures (Commercial Data Specifications) • Visit Dealerships (Site Visits) • Attend car shows (Trade Shows) • Ask friends, relatives, coworkers (Contacts) • Read ‘Consumer Reports’ for best buys and most reliable cars (Trade Journals) • Conduct an Internet Search (Market Survey) • Yellow Pages: Look up dealers in your area (Source Identification) • Ask dealers about financing plans, discounts, warranties, options, etc. (Terms and Conditions) • You performed market research by... …gathering and analyzing information about the capabilities of the new car market to satisfy your car needs. BUYING GOODS AND SERVICES FOR THEGOVERNMENT IS NOT MUCH DIFFERENT.

21. Independent Government Cost Estimate (IGCE) for Service Requirements & Independent Government Estimate (IGE) for Commercial Supply Requirements The NAVSUP Enterprise

22. IGCE Independent Government Cost Estimate (IGCE): • The IGCE is the Government's estimate of the resources and projected cost of the resources a contractor will incur in the performance of a contract. These costs include direct costs; such as labor, supplies, equipment, or transportation and indirect costs; such as labor overhead, material overhead, as well as general and administrative (G&A) expenses, profit or fee • Required for every new acquisition that exceeds the simplified acquisition threshold ($250K) • Developed by the requiring activity and used to establish a realistic price/cost for budget purposes. In addition, the Contracting Officer uses the IGCE for technical and management information. The IGCE is the baseline for evaluation of a realistic contract price/cost. Format and contents of the IGCE will vary in accordance with the complexity and value of the requirement • Although IGCE documentation is a part of the government procurement cycle, there is no detailed guidance on how to prepare an IGCE in statutes or regulations. Some practical advice, however, includes the following: an IGCE should bear a close relationship to the program being managed, it should be independently prepared by a subject matter expert. Most important to remember: • Must be current, valid and reliable • Do not base the IGCE on a contractors cost/price estimate **THERE IS NO SPECIFIC FORMAT!!! *SOURCE: https://www.acq.osd.mil/dpap/sa/Policies/docs/DoD_IGCE_for_SA_Handbook.pdf

23. IGCE Example

24. IGE • A Commercial Supply "Independent Government Estimate (IGE)" is much less complicated than the IGCE for a service contract and is considered a "Price Estimate" • IGE Is an unbiased cost estimate based upon the specifications (Government’s actual needs) • The IGE is developed by the requiring activity; it is a matter of determining the market value of an item and using that figure as the IGE, documenting your research, then furnishing this information along with your funded requisition to the contracting office • Can be developed using numerous methods including: • General Services Administration (GSA) schedules • Published price lists • Catalog pricing • Market survey • Previous buys/History • Purpose: • Basis for budgeting and reserving funds for the contract • Basis for comparing costs or prices proposed by offeror • One of the basis for determining price reasonableness when only one proposal is received • Most important to remember: • Must be current, valid and reliable **THERE IS NO SPECIFIC FORMAT!!!

25. Key points: (What you ask for, not what you want) • You set the requirements - contracting officers cannot read your mind • Do not assume anything - be specific and as thorough as possible Performance Work Statements • What To Do: • Describe Performance Requirements • Use performance-based language: What, when, how many/much, how often? • The PWS should state requirements in general terms of what (result) is to be done, rather than how (method) it is done. (Desired Outcomes) • Identify Metrics • Quantity/Quality • KO will tie Evaluation Factors to Performance Requirements • Written as simply as possible, while stating the requirements clearly. • Be consistent in terminology, especially when referring to technical terms. • What Not To Do: • Use words like “Support” or request numbers of bodies/resumes. • Weekly Reports as Metrics • Personal Services (In GOV space, use GOV equipment, perform GOV function, subject to GOV supervision) • Inherently Governmental Functions (Conduct of foreign relations, determine Foreign or Agency policy, direct/control of GOV employees, voting member on source selection board) • R&D: “Develop”; “First Article Testing” “Pre-Production” (wrong color of money and FLCPH lacks of authority). • Be ambiguous

26. PWS Writing: Purpose What makes something a Performance-Based Work Statement? • Provides our objectives and allows the contractor to determine how to achieve that objective Why use a Performance-Based Work Statement? • Takes advantage of the contractor’s expertise. One of our reasons for using a contract instead of accomplishing the work with Government resources is because of our lack of expertise/manpower

27. PWS Writing: Basics State the Required Outcomes/Objectives: • Provide the guidelines, operating environment, basic tasks (not the steps towards accomplishing those tasks) Provide Performance Standards: • How will the contractor’s performance be measured to determine if they were successful? • Use metrics that are measurable and meaningful since contractor will focus on performing to these standards Consider what will incentivize the contractor to perform well

28. PWS Elements to Consider What is needed? • Objective, Tasks, and Other related information • Think of describing the guidelines or boundaries that the contractor must work within When do I need it? • When does it need to begin? End? • Do options for additional time make sense? Is the requirement a recurring need or a one time effort? How do I know that I got what I wanted…that the contractor was successful in their performance? • Metrics selection often focuses on quality and timeliness of performance

29. PWS Basic Format • Purpose/Background(Basic "what”/Why/History? Make this Section very brief, i.e. one paragraph) 2. Objective/Scope (Who? When? Where?) • Outlines /defines basic boundaries of contract 3. Tasks (Detailed “what”) • Provides the details of what the contractor is expected to accomplish without telling them how to do it 4. Other pertinent information • Acronyms, minimum skill set required, government’s role, parameters like hours, location of performance, Any/all applicable Contract Security information/requirements, etc.) • List of Deliverables 6. Performance Standards

30. Developing a PWS • A PWS should state work in terms of outcomesor results, rather than methods of performance. • Example: The Contractor shall mow the grass so that it is maintained at a level from two to four inches at all times. vs. The Contractor shall mow the grass once a week using a gasoline-powered lawn mower set at a two-inch height. • Areas to consider: • What must be accomplished to satisfy the requirement? • What tasks must be accomplished to arrive at the desired outcome? • When or how will I know the outcome has been satisfactorily achieve, and how much deviation from the performance standard will I allow the contractor, if any? • Acquisition Requirements Roadmap Tool Suite (ARRT) http://sam.dau.mil/Content.aspx?currentContentID=pws_soo

31. PWS Basic Illustration • This is what you need: • You say, “Yellow custom car” • You get this: Contractor met requirements- Are you happy?

32. PWS Basic Illustration • KO cancels the solicitation, • cost the government time • and money, and re-solicits: • You say, “Yellow custom car w/4 wheels/more than 1 seat” • You get this: Contractor met requirements again- Still not happy?

33. PWS Basic Illustration • KO cancels the solicitation, • cost the government time • and money, and re-solicits: • You say, “Yellow custom sports car w/4 wheels, 2 seater, 2 doors, V6 engine, that will propel you from 0 – 60 in 6 seconds, performance tires, performance ride and handling suspension with specific stabilizer bars, leather interior, etc. • You get this: Contractor met requirements and now you are happy!

34. Avoiding Common PWS Mistakes Remember….Tell “what” (objective) not “how” (steps to accomplish objective) • There is a difference between drawing boundaries and telling steps • Minimize telling the contractor the number of people required, where possible • Watch out for use of “position description” type info instead of focusing on outcome required • Beware of Personal Services type PWS – Government telling employees what to do, tracking them, supervising them • It is possible that the more detail provided, the less we get the benefit of the contractor’s expertise

35. Personal Services The government hires a contractor for the work products, not for the individual contractor employee.

36. Certification of Non-Personal Services

37. CORs/ACORs/TAs • The Contracting Officer’s Representative (COR) is a representative of the requiring activity, nominated by the requiring activity, and designated (appointed) by the PCO, to assist in the technical monitoring or administration of a contract • The COR should be identified early in the acquisition cycle and included in pre-award activities when appropriate. PCOs shall designate (appoint) a properly trained COR in writing prior to award for service contracts including orders under indefinite delivery contracts (IDCs) and Basic Ordering Agreements (BOAs) unless the following three (3) conditions apply: • the contract will be awarded using simplified acquisition procedures; • the requirement is not complex; and • the file is documented in writing by the PCO why the appointment of a COR is unnecessary • An alternate Contracting Officer’s Representative (ACOR) may be authorize to perform the duties and responsibilities for the primary COR in his/her absence • A Technical Assistant (TA) may be appointed by the commanding officer of the requiring activity to assist COR in executing routine administration and monitoring of duties; however, the COR remains technically responsible for contractor performance monitoring

38. Business Receipt Performance Financials Cost Rqmts / PWS Balancing Risk Drivers Schedule Payment Contract Type Acquisition Planning Best practices clearly indicate that the most critical phase of the Contracting Process is the Planning Phase

39. Acquisition Planning ACQUISITION PLANNING – A CRITICAL PHASE • REQUESTING ORGANIZATION • Prepare Statement of Need • Contact Contracting Office • Establish Project Team • Complete Planning Checklist • Prepare Clear, Unambiguous • Specification/Statement of Work • • Perform Market Research • Prepare Cost Estimate • Prepare Contract Requisition • Furnish Potential Source List • Validate Procurement Request • Obtain Technical Concurrence as • needed Requirement Determination • CONTRACTING OFFICER • Review Statement of Need • Initiate Procurement Planning • Facilitate Planning Checklist • Review Procurement Planning • Validate Requirement • Facilitate Cost Estimate • Finalize Procurement Plan • Obtain Required Approvals Requirement Specification Requirement Authorization Plan your work – work your Plan!

40. 2019 Procurement Event Acquisition Strategy The NAVSUP Enterprise

41. Acquisition Strategy Acquisition Strategy Foundations OUTPUTS INPUTS DID YOU KNOW? The default font for this template is HELVETICA. Call NMCI if you don’t have it and they will install it for you. Text should be blue. Competitive or Sole Source? Program Objectives and Needs FAR Part 12, 13, 14, &/or Part 15? Direction, Funding Develop Acquisition Strategy Early Market Research Contract Type? Risk Assessment Incentives?

42. Reminder: Poor planning or a lack of planning on our customers’ part does not constitute an emergency on our part! JUSTIFICATION FOR URGENCY Unusual and Compelling Urgency: when the need for supplies and services is of such an unusual and compelling urgency that the government would be seriously injured, financially or otherwise. The justification must clearly demonstrate how the government will be severely damaged unless it limits the number of sources. This authority cannot be used if the actual reason for the urgency is a lack of advanced planning by the requiring agency or the possible expiration of fiscal year funds!

43. Acquisition Strategy Generally, requirements solicited either: • Commercial or Non-commercial • Set-Aside or Non-Set-Aside • Competitive or Sole Source • Via an Existing Vehicle or Open Market • Not really a matter of preference • Circumstances generally dictate approach • Market Research reveals the circumstances *Default position is commercial, competitive, set-aside, order against an existing vehicle

44. Commercial or Non-Commercial Commercial or Non-Commercial • FAR 19.502-2(a) Each acquisition…that has an anticipated dollar value exceeding $3,500…but not over $150,000…is automatically reserved exclusively for small business concerns and shall be set aside …unless…there is not a reasonable expectation of obtaining offers from two or more responsible small business concerns that are competitive in terms of market prices, quality, and delivery • FAR 19.502-2 (b) The contracting officer shall set aside any acquisition over $150,000 for small business participation when there is a reasonable expectationthat—(1) Offers will be obtained from at least two responsible small business concerns…and (2) Award will be made at fair market prices

45. Set-Aside or Non Set-Aside Set-Aside or Non-Set-Aside • FAR 19.502-2(a) Each acquisition…that has an anticipated dollar value exceeding $3,500…but not over $150,000…is automatically reserved exclusively for small business concerns and shall be set aside …unless…there is not a reasonable expectation of obtaining offers from two or more responsible small business concerns that are competitive in terms of market prices, quality, and delivery • FAR 19.502-2 (b) The contracting officer shall set aside any acquisition over $150,000 for small business participation when there is a reasonable expectationthat—(1) Offers will be obtained from at least two responsible small business concerns…and (2) Award will be made at fair market prices

46. Competition “It is the policy of the Federal Government that executive agencies shall not engage in non-competitive contracts except in those circumstances where their use can be fully justified and where appropriate safeguards have been put in place to protect the taxpayer.” President Barack Obama for the Heads of Executive Departments and Agencies • IMPORTANCE OF COMPETITION • Prevents waste, fraud, and abuse, because contractors know they must perform at a high level or else be replaced • Healthy competition is the lifeblood of commerce – it increases the likelihood of efficiencies and innovations • Drives cost savings • Improves quality of product/service • Enhances solutions & the industrial base • Promotes fairness and openness leading to public trust 46

47. Limiting Competition FAR Part 6.101 states the KO’s shall provide for full and open competition through the use of competitive procedure(s) that are best suited to the circumstances and sufficient to fulfill the requirement efficiently • Under certain circumstances,the customer may have a requirement that is not suitable for full and open competition. • The Requiring Activity must provide detailed documentation to support limiting competition (specific forms and FAR-based exceptions must be used) • Other Considerations: Better Buying Power Memos • It’s the law! Competition isn’t an alternative, it is required! Other than full and open competition is the exception, not the rule!

48. Sole Source < SAP • Exempt from the requirements in FAR Part 6. • Even though Part 6 does not apply, the government must provide for “maximum practicable competition,” which is defined as soliciting at least 3 sources. (Ref. FAR 13.104) • Contracting officers may solicit from one source if the contracting officer determines that the circumstances of the contract action deem only one source reasonably available (e.g., urgency, exclusive licensing agreements, brand name or industrial mobilization) (FAR 13.106-1b) • Shall be supported by a justification from the buyer explaining the absence of competition. Generally this is based upon a sole source justification from the customer. The customer's justification shall be reviewed, accepted and approved by the KO, and retained in the purchase file 48

49. Sole Source > SAP • The requirements at FAR 13.501(a) apply to sole-source (including brand-name) acquisitions of commercial items conducted pursuant to subpart 13.5. (SAP CI). • 10 USC 2304(c), as implemented by FAR Part 6, requires the use of full and open competition, unless permitted by one of seven statutory exceptions. If awarding a contract under “other than full and open competition” procedures, some form of written documentation is normally required. • J&A: Prepare sole source (including brand name) justifications using the format at FAR 6.303-2, modified to reflect an acquisition under the authority of the test program for commercial items (section 4202 of the Clinger-Cohen Act of 1996) or the authority of the Services Acquisition Reform Act of 2003 (41 U.S.C. 428a). (Templates available) 49

50. SAP Sole Source Justification • The “lock” is the government’s minimum need or requirement. • The “key” is the item/service that meets that need and should include an “only” that describes how this source is the only key that can open the “lock” and meet the minimum requirements of the government. • “Best” does NOT equal “Only”. • Be aware of opportunities when a Brand Name or Equal description