Performance

1. Performance • Consider the contractor’s need to meet the obligations of the contract and perform the requirements of the contract: • compliance with the Ts & Cs, reg’s • the successful building, fabrication, performance of the final product or service • to get full payment for all work under the contract

2. Performance • The contract is written to successfully accomplish the goal of providing a good or service. • To be successful means meeting the specifications outlined in the contract. • SOW • referenced specs (specifications)

3. Performance • What is a specification)? • A description of the technical requirements for a material, product, or service that includes criteria for determining whether requirements are met.

4. Performance • Two general categories of specifications • Design • Performance

5. Performance • Design = government states materials to be used and the mode and manner in which the work is to be performed. • Incorporate text,dwgs that set out requirements such as measurements, tolerances, testing procedures, quality control, inspection procedures. • Govt assumes responsibility for design, omissions, errors, deficiencies.

6. Performance • Performance = less precise than design specs. Describe the performance desired of the end product without specifically directing how the contractor should design or assemble the end product. • Design, measurements, tolerances, etc. not stated nor considered important as long as performance requirements met.

7. Performance • Performance = less precise than design specs. Describe the performance desired of the end product without specifically directing how the contractor should design or assemble them. • Contractor accepts responsibility for design, engineering, achievement of stated performance requirements.

8. Performance • Govt minimum needs • Under the Armed Services Procurement Act, specs are to be developed with the goal of promoting full and open competition. Therefore, specs should describe and require only the govt’s minimum needs.

9. Performance • Govt minimum needs = specs shall precisely and fully define the supplies and services being procured, yet only meet the those provisions and conditions that satisfy the specs. • Specs that exceed the Govt’s minimum needs by containing unnecessary requirements improperly restrict competition by preventing responsive bids.

10. Performance • Why minimum needs vs maximum needs? • To allow more organizations to join in the competitive process. • GAO states that competition can only be obtained where specs fall outside a prescribed and restricted common basis.

11. Performance • Types of Specs: • Federal Specifications • Military Specifications • Industry Specifications

12. Performance • Types of Specs: • Federal Specifications: Issued or controlled by General Services Administration (GSA) and listed in the Index of Fed’l Specs, Standards, and Commercial Item Descriptions. In 1994, acquisition streamlining directed agencies that, to the maximum extent practicable, use performance specs. Therefore, these are stated in terms of function to be performed, performance required, essential physical characteristics.

15. Performance • Types of Specs: • Military Specifications: Specs issued by DoD for mandatory use by DoD activities. DoD Index of Specs and Standards lists unclassified fed’l and military specs and standards, related standardization documents, and voluntary standards approved for DoD use. • Acquisition streamlining = simplified buys, commercial and performance standards whenever possible.

19. Performance • Types of Specs: • Industry Specs: Specs prepared by technical or industry associations, approved for use by federal agencies,.

20. Performance • Government specs will not be furnished with a solicitation unless they are key to the competitive process.

21. Performance • Standards: FAR defines a standard as “a document that establishes engineering and tech limitations , applications of items, materials, processes, methods, designs, and engineering practices.” • Not specs • BUT-- • Criteria considered essential to achieve uniformity of mat’ls & prod’s or interchangeability of parts.

22. Performance • Purchase Description • IAW FAR, Purchase Description = description of essential physical characteristics, functions required to meet Govt’s minimum needs when no spec is required, or • brand names = type of PD that identifies desired prod by name; where physical or functional characteristics are named. • Products that are essential to Govt’s needs.

23. Performance • Deviations vs. Waivers • Deviation = Authorization to depart from a designated spec before work is done. • Waiver = Authorization to depart from a designated spec after work is done.

24. Performance • Implied Warranty: In regards to design specs, compliance to Govt specs implies that the Govt knows what the end-product will be and, therefore, is responsible for the design. Anticipate a satisfactory end-product. • Meeting specs = responsibility of Govt for defects.

25. Performance • Implied Warranty • Govt disclaimers only work if risks to contractor reasonably determined, Govt discloses all available information, and disclaimer gives clear notice that potential problems exist.

26. Performance • Compliance with Specs • FAR Strict compliance but… • in minimum manner or least expensive means.

27. Performance • Substantial Performance • The Doctrine of Substantial Performance says that the Govt may not reject and terminate contract performance that minorly deviates from the requirements and has performed a major portion of completion, delivery. • It can still insist on completion • If not practical or desired, contractor is entitled to credit for reasonable value of work and unperformed work.

28. Performance • Substantial Performance • These construction contract requirements make other issues of substantial performance easier to understand • In supply contracts, looking at timely delivery, substantial conformity, contractor’s reasonable belief of compliance. Non-conformance is minor and correctable in reasonable time.

29. Performance • Substantial Performance • These construction contract requirements make other issues of substantial performance easier to understand • In service contract, looking at % of completion and quality of work performed.

30. Performance • The adherence and compliance to specifications is addressed in the Govt’s inspection of contractor supplies and services being acquired.

31. Performance • Inspection • In FAR, inspection is primary means of assuring quality. • Level of inspection intensity = nature of supplies, services procured.

32. Performance • Inspection • In FAR, found under part titled “Quality Assurance.”

33. Performance • Inspection Procedures • Contractor obligated to: • control product quality • offer Govt supplies that meet specs • ensure suppliers, S/C quality and compliance • provide substantiating evidence of compliance

34. Performance • Levels of Inspection • Inspection by Contractor • Non-critical, commercial items • Standard • IAW FAR as written • High-level • Complex, critical items with strict compliance required to Govt specs and quality control.

35. Performance • Inspection • Time and place of inspection is determined for least impact to contract’s performance, cost, product delivery. • On-site = cost to contractor • off-site = cost to Govt • Formal acceptance: Sign-offs, official transfer of ownership vs. Implied acceptance: Govt’s acts are inconsistent with contractors continued ownership of goods, i.e. retention.

36. Performance • ACCEPTANCE = GOVERNMENTS OWNERSHIP

37. Performance • Rejection and Correction • With the right to strict compliance to specs (except under conditions of deviation/waiver, substantial performance) Govt can reject work and give contractor time to correct it.

38. Performance • If rejected, Govt can • remove, replace, correct rejected product at contractor’s expense • terminate the contract for default and reprocure at the contractor’s expense, in the event a Default clause in contract. • Retain items and modify contract.

39. Performance • Post-Acceptance Rights • Acceptance final except where there is: • latent defect • fraud • gross mistakes (which are tantamount to fraud) • something in contract terms that qualifies the acceptance

40. Performance • Warranties • Assure quality of contract performance for reasonable scope and duration of use of product. • Express Warranty: Decided upon by Govt to consider protection over time and use. Clauses require correction, replacement, or change to contract.

41. Performance • Implied Warranty: Uniform Commercial Code (UCC), provides 2 implied warranties: • implied warranty on merchantability - supplies will be fit for ordinary and usual purposes acquired for • implied warranty of fitness for particular purpose

42. Performance • Defective Specifications • Impossibility of Performance • Actual Impossibility = cannot be performed because of erroneous specs, specs cannot be met, or specs are beyond state-of-the-art. • Practical Impossibility = specs not possible within basic contract objectives. • Govt assumes risk in cases of design specs in impossible situations and/or superior knowledge vs Contractor assumed risk of obvious failure and,or superior knowledge.