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Overview Of Procurement Process

Bill HatchlProcurement Manager

January 2005http://genesis.gsfc.nasa.gov/210/con210m.htm

Procurement 101

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Evaluation

• Is the information in this presentation useful to you?

• What topics were not covered that you need to know about, or were not covered enough?

• What additional information on those topics would you like to learn about?

• What topics were covered that you didn’t need to know about, or were covered too much?

• Other comments?

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Who Does Code 210.M Procurement Support?

• AETD (Code 500), IV&V (Code 180), ATO (Code 408), Space Communications (Code 450) and OSSMA (Code 300)

• Simplified acquisitions (<$100k)• Larger dollar contracts, including competitive and sole-source:

» Commercial acquisitions» R&D

» Supplies» Services

• SBIR/STTR’s• NRA’s• Interagency agreements (with other Federal government agencies only)• Requests for information/partnership opportunity documents

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Federal Government Procurement

• Where the seller gets to sue the buyer (that’s us) because the seller disagrees with the buyer’s purchase decision

• Where everything is supposed to be competed, even when you already know of a very, very good source

• Where it’s deliberately made difficult to buy from only one company

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The Procurement Process(Dictated by statute and regulation)

• Synopsize requirement (16 to 30 calendar days*)

• Issue solicitation (Request for Proposal, Request for Offer, Request for Quote) (30 to 60 days*)

• Proposal receipt (30 to 60 days*)

• Evaluation (cost, business, technical) (45 to 90 days*)

• Contract award, including negotiations (30 to 60 days*)

• Contract administration

• Contract closeout

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Typical Contract Award Lead Times

• Commercial acquisitions– Competitive (90—205 days)– Noncompetitive (98—237 days)

• Noncommercial acquisitions– Competitive (150—325 days)– Noncompetitive (160—340 days)

• Simplified acquisitions (27 days)

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Contracting Methods

• Simplified acquisitions (not more than $100K)– Usually takes 30 days to award

• “Small” contract acquisitions (not more than $10M)– Usually takes 4 to 6 months to award

• “Large” contract acquisitions (more than $10M)– Usually takes 4 to 12 months to award

• Request for Information/Partnership Opportunity Document– _Usually takes 60 days to complete

* Above timelines are approximate due to large, though shrinking, backlog of procurements

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Contracting Types(Selected to reflect the burden of the “risk of cost performance.”)

• Fixed-price contracts– Commercial and noncommercial clear requirements

• Cost-reimbursement contracts– Noncommercial and vague requirements

• Incentive contracts– Noncommercial and improved performance

• Indefinite-delivery contracts– Commercial, noncommercial and indefinite requirements

• Time-and-materials and labor-hour contracts– Commercial and noncommercial and vague requirements– Least favored contract type

• Letter contracts– Immediate performance required

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Fixed Price Contracts

• Firm fixed price, fixed price with economic price adjustment, fixed price incentive fee, fixed price award fee

• Firm fixed price– Fixes price we pay if our specifications are very, very

clear

– Ambiguous specifications are interpreted against us• We may have to pay that fixed price for something that is less

than you need and less than what we thought we were ordering

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Cost Reimbursement Contracts

• Cost Plus No Fee, Cost Plus Fixed Fee, Cost Plus Incentive Fee, Cost Plus Award Fee

• Contractor promises its “best efforts” and we promise to pay whatever the Contractor spends– Initial cost is only an estimate that establishes a

cost ceiling that the contractor cannot exceed without our agreement

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Justification for Other Than Full and Open Competition

(JOFOC-sole source)

• Required for sole source and limited competitions– Must demonstrate that the source (or limited sources) is

the only entity in the world that can meet your minimum requirement

– Must explain your requirement and why it is the minimum required

– Competition cannot be avoided because we failed to begin the procurement process early enough

• Such justifications must be posted on the worldwide web for 15 days

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Waiver of Sole Source Web Postings

• Based on unusual and compelling urgency– Intended to be used rarely for true emergencies– Agency will be seriously harmed (financial, technical,

or other substantial injury) if competitive process is used

– Justification must include details, not just conclusions• Show how we didn’t dawdle in determining our requirements

and starting the procurement process• Show the precise and serious harm that will be suffered• Provide the dates and timelines that prevent taking the time

needed for the competitive process

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Competition Types

• Lowest price/cost responsive bid– Winner is the lowest price bid that meets our minimum

requirements

• Best value responsive bid• Winner is the bid with the best value, considering technical

merit, cost/price, and past performance– Do not underestimate past performance as this factor can

eliminate companies that have not successfully completed similar work

• Requires fair evaluation criteria to be developed in advance, included in our solicitation, and strictly used to evaluate the bids received

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Small Business Set-asides

• Each competition must be considered for limitation to small businesses only– Two qualified small businesses are sufficient to

set aside a competition for small businesses only

– Requires us both to conduct market research to determine if there are two small businesses

• Default is to post your requirement on the web and ask small businesses to tell us their qualifications

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Performance Work Statement

• Should define required outcomes instead of design specifications– “What result we need” versus “how to do it”

• More is better than less– Insure that terminology is clear and has a

commonly accepted meaning (“term of art”) in the wider technical community

– Ambiguities are construed against the drafter (i. e., us)

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Technical Evaluation

• Required at some level of detail for every contract award (more as the dollar value of the award increases)

• Essential requirements for a complete technical evaluation– Recommends, explains, and justifies adjustments when required to

insure product/service will satisfy your requirement– Analyzes labor hours, categories, and mix of categories– Analyzes other direct costs (materials, subcontracts, travel, etc.)– All the above applies equally to subcontractor costs– Approved by your branch manager

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Negotiation(A fair and reasonable price)

• Remember that you have a role to help negotiate a fair price for what you need

• Fact-finding– Technical, resources, and contract personnel

– Used to get our questions answered during our evaluation

– Avoid transfusion and leveling

• Negotiations– Same team members working towards a fair price

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Task Orders

• Performance work statement• Solicitation, evaluation, and negotiation of

contractor proposal• Award of negotiated task order• Process can be completed in 15 days

– Can issue a task order before solicitation is issued

– Task Order Management System (TOMS) automates entire process

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When Do You Need Procurement?

• When you need some thing or some person that you don’t already have.– If you do not have it, my office is probably

going to have to buy it for you.

• Come early because we will need a lot of time to get it

• Always remember that government procurement is neither easy or quick

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What Does Code 210.M Procurement Do?

• Purpose– Provide full service procurement

support• Plan acquisitions• Award contracts, purchase orders, and interagency

agreements• Administer contracts, etc.• Resolve contract problems (performance, cost,

other)• Close out physically complete contracts, etc.

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Contacts in Code 210.M

• Diane Scheuerman, x4208• Eric Newman, x4240• Cathy Pierson, x5257• Darlene Dorsey, x4242• Jennifer Awkard, x6843• Carol Barton, x4239

• Dave Vance, x2802• Mayra Nieves-Torres, x0422• Chuck Greene, x3721 (6/W125)• Brett Gillard, x2142• Nipa Shah, x1892• Gerry Humphrey, x9083• Delma Moore, 304-367-8491

(IV&V/WVa)

Contracting Officers/Contract Specialists

Procurement Manager

Bill Hatchl, x6843

We are located in Building 11, Room S215

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Contacts in Code 210.MContract Administrator

Vacant

Simplified Acquisition Specialists

Cynthia White, x3596 (Team Leader)

Sandra Harrell, x3723 (Codes 540-544 and cell phones)

Marolyn Cross, x4782 (Code 560 and pagers)

Talaya Brooks, x6937 (Codes 552-556)

Agnes Smith, x9129 (Codes 180, 300, 408, 450-454, and 500-504) (6/W125)

Raymond Jones, x3722 (Codes 550-551, and 590)

Yolanda Williams, x0689 (Codes 545-549 and 580)

Rhonda Roebuck, x8688

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How Can We Make the Process More Efficient?

Try as we may, we cannot work miracles!

• Planning– As early as possible--

• discuss requirements with procurement

• mutually develop procurement strategy and schedule

• Prepare Complete Documentation– Include all necessary documents with PR– If sole source, ensure well-written JOFOC

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Do’s and Don’t’s

Do--• Meet with procurement early-on to discuss your

requirements• Communicate often and regularly• Seek advice and assistance • Ask questions if you don’t understand how to put

together a required document (i.e., JOFOC, SOW, evaluation criteria, etc.)

• Prepare and submit all required documentation promptly

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Do’s and Don’t’s

Don’t--• tell the contractor to start work before contract

award• agree to any special terms and conditions of

contracting without consulting with procurement first

• admit fault or liability on the part of the Gov’t. without first discussing the situation with procurement

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Simplified Acquisitions

• Purchases $100,000 or less must be set-aside totally for small businesses

• There are exceptions:– GSA supply schedules

– Lack of 1 or more small business sources• Requires comprehensive market research to support this

conclusion

• Sources sought web posting if market research inadequate, delaying the purchase

– Sole source

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Simplified Acquisitions• Simplified acquisitions systemic problems

– AMS reporting increased• Beginnings of PR backlog• Increases effort and time to award POs

– IFM was new and had to be learned– IFM is not as good as SPS

• No linked DGS, requiring us to generate POs from scratch• No email notifications to requisitioners• No workable interim status system• Close down periods require hand-entering of PRs and POs • Harder to use, not as complete as SPS (not a purchasing system, IFM

purchasing module expected in 2006 or 2007)• Few, if any, checks to insure that PR initiators provide us with complete and

accurate info, requiring us to track it down and enter it into the IFM system

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Simplified Acquisitions• Purchase Requisition Improvements

– Need to insure PRs entered into IFM include all necessary information• Choosing correct P Group for non-simplified acquisition PRs• Choosing the correct release strategy• Header text tab has all essential info

– Requisitioner, Initiator, and Resources Analyst and their organization code(s)– Suggested sources, including points of contact and phone numbers– Item text

• PLIs include all relevant part numbers, etc.• Item details• Including line item description details in Item text tab or in an attachment• Including all the info in the delivery address tab

– Remember to track PR progress through IFM release strategy, especially when PR rejected or hung up in release cycle

• Reviewing initiator or branch head in-box for rejected PRs

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Simplified Acquisitions

• Purchase Requisition Improvements (cont’d.)– Use electronic attachments feature in IFM to include statements of

work, sole source justifications, etc.– De-commit funds after PO issued for lesser dollar amounts– Sole source requires 3 elements:

• Why what you want is NASA’s minimum requirement• Why your company is the only one that can satisfy that minimum

requirement• Demonstrate that you adequately planned this procurement

– Remember that you can initiate a purchase requisition with $0; you don’t have to wait for the cash to get to Goddard and AETD

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Back Up Charts

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What Does Procurement Do?• Pre-award Activity

– Acquisition planning• contract vehicle (simplified acquisition; mid-range;

commercial, etc.)• contract type (cost-reimbursement, fixed price,

IDIQ)• documentation--review and help prepare--

– sole-source justification– statement of work– specification– Procurement Request (PR)– in-house cost estimate– evaluation criteria

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What Does Procurement Do?

• Solicitation Process– Sole-source and competitive– prepare solicitation document (RFO, RFP,

RFQ)– oversee proposal evaluations

• Award Contracts– negotiate– prepare contract file documentation– review and approval process– issue signed contract document

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What Does Procurement Do

• Contract Administration– Administer contracts/purchase orders after

award (funding, contract changes, etc.)– Ensure that contractor adheres to terms and

conditions– Resolve cost and performance problems– Invoice payment process

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• Standard Leadtimes– based on type of type of procurement action

Competitive vs. noncompetitiveCommercial vs. noncommercialDollar amount of requirement (simplified

acquisition vs. mid-range vs. SEB)Interagency agreementSBIR/STTR’s

Why Does It Take So Long??

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Why Does It Take So Long

• Review of PR package for completeness– PR completed properly (all required signatures,

routed through Accounting and AMS)?– Sole-source (JOFOC), if necessary?– If competitive, evaluation criteria?– Statement of Work complete and in PBC

format?– Specification?– Name, address, and telephone number of

contractor if sole-source?

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Why Does It Take So Long??

• Synopsizing – All procurements over $25k– FAR states that they you must allow 15 days – Only extreme situations permit waiver from

this requirement

• Solicitation Process– Gov’t requests a proposal– Contractor(s) submits proposal(s)

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Why Does It Take So Long

• Review of Proposal– technical– cost– business

• Contract Award– Gov’t prepares contract for contractor signature– After signature by contractor, Gov’t

countersigns and the contract is formally awarded

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REMEMBER--Poor

planning doesn’t constitute

a justification for a

sole source!

Cannot overemphasize the importance of early planning!

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Reminders

• Despite some perceptions and beliefs to the contrary, we are here to help!!

• Call anyone in the office at any time if you have any questions whatsoever. There is no such thing as a dumb question!

• You are not expected to know all the “ins and outs” of the procurement process; that’s what we’re here for.

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Success Starts With… A Team Effort

• Technical and procurement personnel must work together as a team

• Each has a specific area of expertise

• Both are necessary to successfully procure the supplies and services needed to support the mission of AETD and Goddard

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We Can Make the Process More Efficient and Effective!

Working together as a technical and business team

Understanding the process

Initiating requirements sufficiently in advance

Ensuring complete procurement packages

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A Final Note...

• Involve procurement early on in the planning process

• Always remember procurement in your planning process

• Early procurement planning is of paramount importance

...In other words, don’t forget to include procurement when planning your

programs and projects!!