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Contract Planning

The Acquisition Environment

The acquisition environment is influenced by each organization's mission support strategy, successful customer relationships, and core principles of decision making. This lesson provides you with an opportunity to guide your actions and to research and develop a strategy so you can recognize when your efforts support the mission.

In this lesson, you will cite key components of successful customer relationships and describe how your office achieves success through the key relationship criteria it exhibits and apply these key components by choosing appropriate methods of dealing with your customers in a practice scenario.

This lesson will help you build a foundation for good decision making based on the core principles of power and responsibility and give an opportunity to apply the Seven-step Path to Better Decisions in a practice scenario.
Mission Support Strategy

The mission support strategy is a systematic plan of action that aligns the organization's activities with its mission and objectives.

The Terminal Learning Objective is: Given a customer need, reinforce areas of mutual interest within an acquisition environment (requiring activity, contractor, contracting office, others).
The Enabling Learning Objectives are: * Apply the factors in development of your mission support strategy. * Apply the key characteristics for successful customer relationships. * Apply the Seven-step Path to Better Decisions.

The Mission Support Strategy

In learning about the organization's mission, you will discover: * What is a strategy? * What is my organization's mission? * How does acquisition fit into my organization's mission? * How do I fit into this mission?
The dictionary defines the term strategy as an elaborate and systematic plan of action. Several key words are: systematic, plan, and action. Systematic means the strategy is a set of ideas that encompasses the purpose of the whole organization. It is also intentional and doesn't happen by accident. Additionally, the organization takes purposeful steps to accomplish its mission.

Many organizations formalize their strategy in what is called a strategic plan. A strategic plan is a document used by an organization to align its organizational structure and budget with its priorities, goals, and objectives.

1. Systematic Strategies

Systematic strategies are organized.

2. Intentional Strategies

Intentional strategies are planned.

3. Purposeful Steps

Purposeful steps require action.

Many organizations proudly post their missions on their web pages. Here are some other examples of mission statements. Visit each mission statement, then return here. * Defense Advanced Research Projects Agency (DARPA)
DARPA’s mission is to maintain the technological superiority of the U.S. military and prevent technological surprise from harming our national security by sponsoring revolutionary, high-payoff research bridging the gap between fundamental discoveries and their military use.
Over the years, DARPA has worked to enhance our national security by funding research and technology development that not only have improved our military capabilities but have changed the way we live. Since the very beginning, DARPA has been the place for people with innovative ideas that lead to groundbreaking discoveries.

* Defense Information Systems Agency (DISA)
DISA, a Combat Support Agency, provides, operates, and assures command and control, information sharing capabilities, and a globally accessible enterprise information infrastructure in direct support to joint warfighters, National level leaders, and other mission and coalition partners across the full spectrum of operations.

Information superiority in defense of our Nation.

* Navy Helicopter Sea Combat Wing, Atlantic (HELSEACOMBATWINGLANT)
HSCWL is the FSX Fleet's sole Navy helicopter wing, and home to its only Navy helicopter squadron, Helantisubron Three. This website is, since HSCWL contains only HS-3, also the homepage of this squadron. Welcome aboard!
Wing Mission
HSCWL is tasked with providing all helicopter support for Fleet Forces Command. Currently, HSCWL provides support for both FLTFORCOM and FLTFORPAC. Details on squadron profiles may be found on individual squadron pages.

* Army Fort Belvoir
Leaders in Excellence
Our military mission is global. As a strategic sustaining base for America's Army the work we do is vital to the success of the goals and objectives of the nation's defense strategy.
A list of the organizations who call Fort Belvoir home reads like a "Who's Who" of the Department of Defense. No other Army installation in the world can compare to Fort Belvoir and its singular mission to provide logistical, intelligence and administrative support to such a diverse mix of commands, activities and agencies.

Fort Belvoir has changed in many ways over the past several years, but some things will always remain the same. As dedicated stewards of the environment, we will continue to work always to conserve the natural beauty of the land around us, and to preserve our standing as one of America's enduring installations. Belvoir will always mean "Beautiful To See."

* Air Force Museum

* Marine Corps Logistics Command (MarCorLogCom)

"MarCorLogCom Mission. To provide worldwide, integrated logistics/supply chain and distribution management; maintenance management; and strategic prepositioning capability in support of the operating forces and other supported units to maximize their readiness and sustainability and to support enterprise and program level Total Life Cycle Management." | * Department of Homeland Security

* Internal Revenue Service (IRS)

Practical Exercise (continued)

James Newman and Lt. Linda Appleton will be working closely with KBR on their acquisition project. James visits the KBR web site to learn more about their mission. He learns KBR believes strongly in working side-by-side with their customers all over the world to meet their needs. KBR also believes in efficiency and controlling costs. Now it's your turn!

Find your mission statement on the Internet. If you cannot find the mission statement by looking on the Internet, ask your supervisor to help you locate: * Your organization's mission statement * Your office's mission statement * Your major customers and their mission statements
Print or save a copy of each mission statement so you can refer to them as you work.

Once you have the mission statements for your office and your major customers come back and continue the lesson.

Mission, Vision and Values
KBR's core values drive everything we do. Incorporating these core values in our daily work, and making them an integral part of our culture, is key to our future success.
Our values solidify who we are and what we believe.
KBR's values are: * Uncompromising commitment to Quality, Health, Safety and Environment * An open relationship with our employees based on mutual trust, respect and success * Transparency, Accountability and Discipline in our business * Best in class Risk Awareness * Integrity in all we do * Financial Responsibility to our stakeholders
Our mission defines what we set out to do each day.
KBR's mission is:
To safely deliver any project, any time, in any environment for the benefit of our customers, shareholders, employees and the communities we serve.
Our vision reminds each of us of what we should be striving for each day and where we ultimately want to be as a company.
KBR's vision is to be the world's premier contractor delivering projects and services to a global marketplace. Our track record has proven that time and again when faced with the task at hand, regardless of the challenges, we deliver the work that is expected of us. To that end, KBR's motto or slogan is 'We Deliver'.
Think about some of the contracts your office awards or administers for your customers. How does the contract advance your customers' missions? Would a different type of contract arrangement better meet the customers' missions?

These are the types of questions you will need to continually ask in order to make sure that acquisition is supporting the mission. If you have a question about whether the proposed contract action is supporting the mission, then ask: * Your customer * The contracting officer * Your supervisor
Answering these questions will help you see how acquisition supports the mission.

Consider your own job description. Hopefully, the duties therein describe actions that support the acquisition mission and describe what you are doing. Regardless of what your current job description says, you can provide better mission support by developing a personal mission support strategy.

A personal mission support strategy can help focus our lives.

Whether you are supporting your organization's mission or your own personal mission, you need to ensure that your efforts are focused. You need a plan!

Personal Mission Support Strategy

A personal mission support strategy reflects how your efforts support the missions of your organization, office, and customers.

Practical Exercise (continued) | Why must you discover and understand the mission of your customer?

| | To ensure the contracting officer understands his responsibilities | | | To ensure the customer understands acquisitions | | | To ensure the contract vehicle meets your office's mission | | | To ensure the contracting officer's actions support the mission | | | |
You must discover and understand the mission of your customer to ensure your actions support the mission.
How does acquisition fit into your organization's mission?

| | It helps your customer write its mission statement to align with yours | | | It helps you ask questions to ensure that acquisition is supporting the mission | | | It helps your supervisor write a better mission statement for your customer | | | It helps your office meet its goals regardless of the customer's mission |

Acquisition fits into your organization's mission by helping you ask questions to ensure that acquisition is supporting the mission.

Development of a Strategy | Your strategy is a roadmap to serving your customers within the acquisition environment.

Here you will learn the: * Purpose of a strategy * Elements of a strategy * Steps to develop a strategy * Strengths, weaknesses, opportunities, and threats (SWOT) analysis * Additional resources availablePurpose of a StrategyYour personal mission support strategy will: * Serve as a framework for decisions and actions * Outline the steps to accomplish the mission * Provide a basis for more detailed planning * Explain the plan to others to gain buy-inElements of a StrategyElements that comprise your personal mission support strategy are: * Definition of the mission: The mission statement * Definition of the goals: Ways you contribute to meeting the mission * Description of strategic actions: Activities that must be done to accomplish the goalsYour personal mission support strategy should also include a description of how you plan to measure progress toward your goals. Goals

Goals are the big picture part of the strategy.Steps to Develop a StrategyAs you develop a strategy, keep the following in mind: 1. Conduct a SWOT analysis to identify factors that affect what you want to accomplish. 2. Think through the strategic plan, and review the purpose and elements of a strategy. It may take days or even weeks to fully develop your personal mission support strategy. 3. Be flexible. Personal mission support strategies, like any strategic plan, are dynamic. As the SWOTs change, so does the plan. Keep it visible, and update it when appropriate. | |

SWOT Analysis When conducting a SWOT analysis, you can use a table similar to the one shown. Review the mission statements of your organization, office, and customers. Then write down the words that come to mind for each box. | The results of a SWOT analysis may be: * Weakness: A description of lack of knowledge in a particular area of contracting, and why it is needed in order to meet the mission * Opportunity: A solution that addresses the weakness, such as taking a DAU continuous learning module (CLM) in a specific area of knowledge | |

Additional Resources Available

There are several tools available to help develop your strategy. We do not endorse any of the sites, but you may find additional insights by visiting the MindTools™ Personal SWOT Analysis site. The site contains useful information about SWOT analysis. It contains specific information with regard to conducting a personal SWOT analysis, too. Using this, or other available tools, can help you leverage your talents as you work toward the achievement of your mission.

Practical Exercise 2: Developing a Strategy

The following scenario will prepare you for an exercise in which you will develop a personal mission support strategy. Good luck!

You were recently promoted within your organization. This promotion added the responsibilities of interacting with customers, supporting the development of various projects (including your own), and prioritizing staff workload to meet customers' expectations and needs.

Since you are new to the position, a personal mission support strategy must be created. The support strategy should explicitly describe your vision and mission and the actions you will take in order to meet your responsibilities . It will also describe how you will meet the organization's mission and objectives.

Create a document online or in a notebook where you can write down each part of the strategy as you step through this exercise.

Question 1 of 1 | Prior to building your mission support strategy, you would find the organization's __________ depicted.

| | Vision | | | Mission | | | Strategy | | | Goal | | | |
Prior to building your mission support strategy, you would find the organization's mission.

SWOT Analysis

Here you will begin to create your own mission support strategy document.

Conduct a SWOT analysis to identify factors that affect what you want to accomplish.

Create a heading in your document for SWOT Analysis. Write down your strengths, weaknesses, opportunities, and threats.

Define the Goals

Ask questions to elicit all the ways you can contribute to meeting the mission. Keep the big picture in mind so you tie your role in acquisitions to the mission.

Create a heading in your document for Goals. Write down your goals.

Describe Strategic Actions

Review your goals, and describe the strategic actions that must be completed to accomplish the goals.

Create a heading in your document for Strategic Actions. Write down your strategic actions.

Describe Ways You Will Measure Progress

To successfully implement a personal mission support strategy, you must describe the ways in which you will measure progress toward your goals.

Create a heading in your document for Measuring Progress. Write down the ways in which you will measure progress.

Define Your Mission

Review the mission statements of your organization, your office, and your customers.

Take time to interact with your customers to determine their expectations and obtain information on how they want their products delivered or services rendered. Ask your customers how your staff can meet their expectations. Find out what the customer's priorities are. Your mission statement must include a set of goals that you will accomplish to achieve your mission, as well as the strategic actions that will be taken.

Create a heading in your document for your Personal Mission. Write down your mission statement.

Successful Customer Relationships

Several concepts and questions present themselves when developing soft skills such as building successful, high-quality customer relationships.

Two questions we will look at in this lesson are: * Is contracting a roadblock or a highway? * Is the customer always right?

Is Contracting a Roadblock or a Highway?

As you learned in CON 090, FAR 1.102-2(a) indicates that all team members will use planning and be flexible to accommodate change while fulfilling acquisitions. Building successful customer relationships is also pertinent as it will help you minimize risks through open communication and early recognition of problems. Successful relationships help you plan for success!

Are your contracting personnel seen as people who tell only why something can't be done? Does your office reject requirements, telling customers to fix them without explaining what's wrong, and fail to offer a solution?

Or, is your office always helpful in finding solutions to customers' problems and suggesting ways to get what they want that are better, faster, and cheaper than they were done in the past? If so, then your office is a contracting highway!

Is the Customer Always Right?
Can you keep your customers happy by just responding positively to everything they want?

What if the customer inadvertently asks you to do something illegal? What if it is legal, but it does not represent the best business decision?

Do you do what the customer wants, ignoring propriety and business judgment? Of course not!

Developing excellent relationships depends on much more than just responding affirmatively to customer requests. You do not provide exemplary service by just doing everything the customer asks your office to do.

Use your technical knowledge of contracting and regulations to tailor requirements to the acquisition as well as ensure compliance with the contract terms.

Question 1 of 2 | James wants to facilitate a contracting highway for acquisitions he completes for his customer. Identify the activities that James should complete. Select all that apply.

| | Return the requirements document because their math is incorrect. | | | Call the procuring agency to verify the correctness of math in their requirements document. | | | Tell the customer that their requirements have been rejected. | | | Visit the agency and introduce Marshall, the new subject matter expert in high-rise construction to help clarify requirements. | | | |
Building contracting highways requires actions such as calling a customer to verify the correctness of their math, or visiting to introduce new subject matter experts who can help clarify requirements.

Question 2 of 2 | To provide excellent customer service, contracting officer James Newman should tell his customer that the requirements documents will definitely be approved even if it contains errors.

| | True | | | False |
To provide excellent customer service, contracting officer James Newman should tell his customer that he sees an error in the requirements, but that he knows the correct way to fix it. Key Characteristics of Customer Service | 1. First impressions 2. Early intervention 3. Customer focus 4. Constant communications 5. Flexibility 6. Integrity 7. Technical expertise First ImpressionsWhen our first impression of someone is that she is professional and competent in a specific subject area, we are more likely to build a good working relationship with her. The opposite is also true. |
Early InterventionA person who maintains good customer relationships communicates with the customer early, sometimes even before the customer recognizes that a need exists. Good service includes anticipating a customer's needs. Customer FocusEffective business advisers are knowledgeable of the customer's business. In addition, they value the customer's concerns and always strive to gain customer buy-in on decisions of mutual interest.Constant CommunicationsGood communications are often difficult to achieve. By maintaining a constant flow of communication, problems are discovered early while they are still surmountable. Often these problems are resolved before they worsen.FlexibilityFAR 1.102-4(e) encourages acquisition professionals to be innovative, and to use sound business judgment whenever appropriate.IntegrityDo what is right. Do what you say you will do. When you follow these precepts, you will build a good reputation and customers will seek your advice and support.Technical ExpertiseYes, you need to be flexible, but you also need to know the regulations. You need to know what the customer wants and have the expertise to recommend the best acquisition methods to satisfy their needs.

The remainder of this course will focus on technical expertise. As you study, remember that knowing the rules and procedures is only part of building customer relationships and being an effective business adviser.Practical ExerciseThe following scenario will prepare you for an exercise in which you practice what you have learned. Let's get started!

James Newman vows to himself that he will do all he can to ensure that his customers perceive him as a facilitator to getting what they need to accomplish their missions. The FAR establishes a set of guidelines to discipline the acquisition process and protect the taxpayers. James will work within the boundaries of the FAR to always help find solutions to his customers' requirements. He understands that his customers are the users and line managers who act on behalf of the American taxpayer.

To meet his customers' objectives, James needs to demonstrate that he is responsive and adaptive. When necessary, James is willing to explain the FAR procedures that provide legal constraints to meeting the customers' needs.Think about the key characteristics of customer relationships you learned in this lesson. Reflect on the ways in which James Newman can apply these characteristics when dealing with his customers.

Begin a document online or in a notebook entitled Customer Relationships Plan. Create the following headings: * First Impressions * Early Intervention * Customer Focus * Constant Communications * Flexibility * Integrity * Technical ExpertiseUnder each heading, document ways in which James can apply key characteristics of customer relationships to maintain or improve relationships with his customers.Which of the following actions will help James build successful customer relationships? Select all that apply.

| | Having strong technical knowledge of the FAR | | | Building working relationships with customers | | | Suggesting the lowest-cost solution in every acquisition | | | Being responsive and adaptive |
James can build successful customer relationships by: * A. Having strong technical knowledge of the FAR * B. Building working relationships with customers * D. Being responsive and adaptiveAdd the title Contracting Highway to your customer relationships plan. Under this heading, make note of any actions James Newman can take to pave the way for successful acquisitions.

Following the guidelines you document in this section of your customer relationships plan helps facilitate contracting and eliminate roadblocks.Decision MakingTo ensure you have a sound knowledge of the Josephson Institute's Seven-step Path to Better Decisions model, we will cover: 1. Core principles 2. Seven-step Path to Better Decisions 3. Additional resourcesCore PrinciplesTwo core principles in the decision making process are: 1. We all have the power to decide what we do and what we say 2. We are morally responsible for the consequences of our choicesSeven-Step Path to Better Decisions 1. Stop and Think

One of the most important steps to better decisions is the oldest advice in the world: think ahead. To do so it is necessary to first stop the momentum of events long enough to permit calm analysis. This is often difficult to do in your day-to-day life as a contracting professional and may require considerable discipline to slow your daily process down long enough, but it is a powerful tonic against poor choices.1. Stop and Think (continued)

The well-worn formula to count to 10 when angry and to 100 when very angry is a simple technique designed to prevent foolish and impulsive behavior. We are just as apt to make foolish decisions when we are under the strain of powerful desires or fatigue, when we are in a hurry or under pressure, and when we are ignorant of important facts. | 1. Stop and Think (continued)

Just as parents teach their children to look both ways before they cross the street, we can and should instill the habit of looking ahead before we make any important decisions. It prepares us for more thoughtful discernment. Also, it can allow us to mobilize our discipline or, simply put, it may allow us to utilize the decision-making process more effectively.2. Clarify Goals

Before you choose, clarify your short-term and long-term desired outcomes. Determine which of your many desires affected by the decision are the most important. The big danger is that decisions that fulfill immediate wants and needs can prevent the achievement of our more important and ultimate goals.3. Determine the Facts

Be sure you have adequate information to support an intelligent choice. You can't make good decisions if you don't know the facts. To determine the facts, first resolve what you know, then what you need to know. Be prepared to get additional information and to verify assumptions and other uncertain information.

Once we begin to be more careful about facts, we often find that there are different versions of them and disagreements about their meaning. In these situations, part of making sound decisions involves making good judgments as to who and what to believe.3. Determine the Facts (continued)

Here are some guidelines: 1. Consider the reliability and credibility of the people providing the facts. 2. Consider the basis of the facts. If the person giving you the information says he or she personally heard or saw something, evaluate that person in terms of honesty, accuracy, and memory. Remember that assumptions, gossip, and hearsay are not facts. 3. Consider all perspectives, but be careful to consider whether the source of the information has a personal interest that could affect perception of the facts. Seek out the opinions of people whose judgment and character you respect, but be careful to distinguish the well-grounded opinions from casual speculation. 4. Finally, evaluate the information you have in terms of completeness and reliability.4. Develop Options

Now that you know what you want to achieve and have made your best judgment as to the relevant facts, make a list of options, a set of actions you can take to accomplish your goals. If it is an especially important decision, talk to someone you trust so you can broaden your perspective and think of new choices.

Work hard to come up with all the reasonable options. If you try hard enough, you should be able to think of more than one or two choices.5. Consider the Consequences

Two techniques help reveal the potential consequences: * Filter your choices through each of the Six Pillars of Character: trustworthiness, respect, responsibility, fairness, caring and citizenship. Will the action violate any of these core ethical principles? For instance, does it involve lying or breaking a promise? Is it disrespectful to anyone? Is it irresponsible, unfair or uncaring? Does it involve breaking laws or rules? Eliminate unethical options. * Identify the stakeholders and how the decision is likely to affect them. Consider your choices from the viewpoint of the major stakeholders. Identify whom the decision will help and hurt.6. Choose

It's time to make your decision. If the choice is not immediately clear, see if any of the following strategies help: * 1.Talk to people whose judgment you respect. Seek out friends and mentors; but remember, once you've gathered opinions and advice, the ultimate responsibility is still yours. * 2.What would the most ethical person you know do? Think of the person you know who has the strongest character and best judgment. Then ask yourself what that person would do in your situation? Think of that person as your decision-making role model and try to behave the way he or she would6. Choose (continued) * What would you do if you were sure everyone would know? If everyone found out about your decision, would you be proud and comfortable? Good choices make us worthy of admiration and build good reputations. It's been said that character is revealed by how we behave when we think no one is looking, and strengthened when we act as if everyone is looking. * Use the Golden Rule: Do unto others as you would have them do unto you. If we treat people the way we want to be treated, we are likely to live up to the Six Pillars of Character. We don't want to be lied to or have promises broken, so we should be honest and keep our promises to others. We want others to treat us with respect, so we should treat others respectfully.7. Monitor and Modify

Since most hard decisions use imperfect information and best effort predictions, some of them will inevitably be wrong. Good decision-makers monitor the effects of their choices. If these decisions are not producing the intended results or are causing unintended or undesirable results, then reassess the situation and make new decisions.Additional ResourcesThe Defense Acquisition University Continuous Learning Center has many modules to assist you in your career. A module on decision making was developed concurrently with this course. Question 1 of 1 | Which of the following is a step in the Josephson Institute's Seven-Step Path to Better Decisions?

| | Clarify goals | | | Disregard consequences | | | Take risks | | | Be creative | | | |
Clarifying goals is one of the steps in the Josephson Institute's Seven-Step Path to Better Decisions * | | |
Decision-Making SummaryTo summarize, here are the steps: 1. Stop and think 2. Clarify goals 3. Determine the facts 4. Develop options 5. Consider the consequences 6. Choose 7. Monitor and modifyAs a contracting officer, you will make many important decisions to mitigate the risk of project completion. This knowledge will come in handyUse of FAR and DFARSThe Federal Acquisition Regulation (FAR) was established for the uniform codification and publication of acquisition policies and procedures that apply to all executive agencies. The FAR became effective on April 1, 1984, and was a result of merging two major procurement regulations: 1. Federal Procurement Regulation 2. Defense Acquisition RegulationTerminal Learning Objective

Using the Federal Acquisition Regulation (FAR) and Defense Federal Acquisition Regulation Supplement (DFARS), locate required information.Enabling Learning Objectives * Identify how the FAR is organized, administered, and updated. * Identify how the DFARS is organized, administered, and updated. | |
Federal Acquisition AuthorityConstitutional AuthorityThe portion of the Constitution that relates directly to federal acquisition is Article 1, Section 8, which states: * Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States; but that all duties, imposts and excises shall be uniform throughout the United States to: * Raise and support armies, but no appropriation of money to that use shall be for a longer term than two years (with the formation of the Air Force, the United States Attorney in 1948 issued an edict that the Air Force was an army within the meaning of Clause 12.) * Provide and maintain a Navy.Statutory AuthorityOur laws have been systematically codified into 50 different titles under general topics in the United States Code (U.S.C.).

For example, laws relating specifically to the Transportation Department are found in Title 49 of the U.S.C., and the Armed Forces are found in Title 10 of the U.S.C. References to the U.S.C. are by title and section number, for example,10 U.S.C. § 2304. (See United States Code).

In addition to Title 10, there are many other statutes, congressional enactments, Executive Orders, directives, public laws, and regulations that also govern the acquisition process but have not been incorporated into the U.S.C.Regulatory AuthorityThe regulatory authority for the FAR is found in Chapter 1 of Title 48 of the code of Federal Regulations (CFR). 1. Statutes and Laws enacted by Congress 2. Executive Orders signed by the President 3. OMB Circulars 4. OFPP Policy Letters 5. Previously existing regulations 6. Decisions by the Comptroller General 7. Decisions by the Boards of Contract Appeal (BCAs), courts, and case and common law Question 1 of 2 | From what source are all federal acquisition laws and regulations ultimately derived?

| | United States Code | | | Federal Procurement Regulation | | | United States Constitution | | | Defense Acquisition Regulation | | | |
All laws and regulations that govern federal acquisition are derived from the U.S. Constitution. | | |
What would be the effect on the FAR if the President signed an Executive Order that revised the purchasing processes of military bases?

| | Military bases could no longer make purchases. | | | The FAR would be updated to reflect the change in the purchasing policy. | | | The FAR will remain the same. | | | The Board of Contract Appeals would attempt to change the order. |

The material in the FAR must be updated to reflect changes in laws and other policies

Organization of the FAR

Parts | Subchapter – Title | Parts 1-4 | Subchapter A – General | Parts 5-12 | Subchapter B - Competition and Acquisition Planning | Parts 13-18 | Subchapter C - Contracting Methods and Contract Types | Parts 19-26 | Subchapter D - Socioeconomic Programs | Parts 27-33 | Subchapter E - General Contracting Requirements | Parts 34-41 | Subchapter F - Special Categories of Contracting | Parts 42-51 | Subchapter G - Contract Management | Parts 52-53 | Subchapter H - Clauses and Forms | Parts 54-99 | Reserved |

FAR Number Sample Breakdown | Where in the FAR would you find information that tells you if and when you can limit competition for an urgent procurement? The answer is FAR 6.302-2. Let's break this number down and see what it means.

Look at the image to the left. The digits to the far left (left of the decimal point) represent the part number, in this case FAR Part 6, titled Competition Requirements. The numbers to the right of the decimal point and to the left of the dash represent, in order, the subpart (one or two digits), and the section (two digits). The number to the right of the dash represents the subsection.6.3 02-26 (Part) 3( Subpart) 02(Section) 2 (Subsection)FAR Number Title TableFAR 6.302-2, as used in our example, uniquely identifies the subsection that describes Unusual and Compelling Urgency as a circumstance permitting other than full and open competition within the discussion of full and open competition as a requirement.

The FAR identifies subdivisions below the section or subsection level with parenthetical alpha numerics using the following sequence: (a)(1)(i)(A)(1)(i).

Thus, in our example, the detailed information we were looking for can be found in paragraphs (b) Application and (c) Limitations, or FAR 6.302-2 (b) and (c). 1. Part Far # 6 Competition Requirements 2. Subpart Far #6.3 Other than full and open compentition 3. Section Far # 6.302 Circumstances permitting other than full and open competition 4. Subsection Far# 6.302.2 Unusual and compelling urgency, etc.Complete Answers in the FARIt is important to note here that you will rarely find a ''complete'' answer contained within a single paragraph within the FAR.

Many provisions contained in each paragraph of the FAR are dependent on guidelines set forth in other paragraphs. Therefore, you must be diligent in your research of a given topic to ensure that your conclusions are both accurate and complete.Locating Information in the FAR1. FAR Table of Contents1.To find information using the Table of Contents, first go to the FARSite.

2. Second, navigate to the Table of Contents by selecting the desired box (Part) with its label in the center of the screen.

3. Third, scroll through the Table of Contents to locate the applicable FAR part, subpart, section, and subsection.

4. Finally, select the desired subsection to read the associated information. 2. FARSearchTo conduct a keyword search, return to the FARSite and select the FARSearch button at the bottom of the page 3. FARSearch - Enter Index and Keywords( Fast Way)To use the FAR keyword search, select the FAR as your database, then enter a word, or phrase, that best describes the information you are searching for. Continuing with our example, select Databases, followed by FAR current. Then, enter ''other than full and open competition'' in the ''Search'' field, and click the ''Search'' button.

Completing this step should result in a screen similar to the one depicted here. 4. FARSearch - Initial Returned Results and Refine SearchThe initial search for "Other than full and open competition" yielded a total of 39 results. You now have the option of searching through the documents listed, or refining your search by repeating (continuing with) the process and adding another search word or phrase. For this example, we will refine our search and add the word ''permitting''.

Notice that this greatly reduced the number of documents that now meet the search criteria. For our example, we are left with FAR Part 6, the Table of Contents, and the Index. | | 5. FARSearch - Refine Returned Results
Finally, select the document you want to review and read the information. Using the results of the FAR search, you can view the information in one of three ways: * View the selected occurrence in context * View the selected document with Search Terms Highlighted * View Document in HTML (if possible

IndexThe Index is located at the back of the FAR (the FAR Index can also be located online at one of several sites, including NASA.) The FAR Index is an alphabetical listing of the major topic areas described within the FAR. Listed under each of these topic areas are the corresponding sections in the FAR that describe information related to the topic. |
To locate the information we need using the index, you would first choose what you feel is the most appropriate topic area. In this case, after looking through the index, we have selected Competition Requirements.

You would then choose the best section or subsection that contains the information you are looking for.

The last step is to go to the information, read it, and check for any cross references. Question 1 of 2 | FAR numbers contain specific elements that provide the "address" within the subchapters for the information you are looking for. Select the answer that correctly presents the parts of a FAR number.

| | Division, Part, Section, Chapter | | | Part, Section, Subsection | | | Part, Subpart, Section, Subsection | | | Division, Section, Subsection | | | |
The parts of a FAR number are the part, subpart, section, and subsection |
If you knew two or three significant words about an acquisition topic, but only had a few moments before you joined a conference call with a prospective customer, how would you locate the information you need most quickly in the FAR?

| | Review the hard copy of your favorite sections that you keep at your desk. | | | Scroll through the index to see what entries are listed for the words. | | | Scroll through the table of contents to find sections related to the words. | | | Select the FARSearch button to do a keyword search on the FARSite. |

Using the FARSite button for your keyword search is the fastest way to get the most current information.

Implementation, Supplementation, Clauses and Provisions

Agency implementation guidance wither expands upon or interprets information provided in the FAR.

Agency supplementation guidance provides new information for which there is no counterpart in the FAR.

As general rule, supplemental regulations shall not: * Unnecessarily repeat, paraphrase or otherwise restate material contained in FAR or higher-level agency acquisition regulations. * Conflict with the FAR ( except when required by law or authorized) * Be less restrictive than the FAR on a particular matter

Agency Acquisition Regulations
Agency acquisition regulations shall be limited to: * Those necessary to implement FAR policies and procedures within the agency * Additional policies, procedures, solicitation provisions, or contract clauses that supplement the FAR to satisfy the specific needs of the agency

So, why is this important to you? Because, when making procurement decisions, you must abide by: * The FAR * Your agency's supplement to the FAR (e.g. DFARS) * Internal guidance

Clauses and Provisions
Clauses and provisions are contained in FAR Part 52.

Clauses and provisions are used to hold the contractor accountable for fulfilling the contract terms and, at the same time, provide the Government with rights, such as, to monitor performance, inspect, and accept products and services. The Government reserves the right under these clauses to take corrective action if performance is unsatisfactory.

These same clauses and provisions hold the Government accountable and allow contractors to take corrective action against the Government. For example, they protect the contractor from the inability to perform or other damages caused by the late delivery of Government Furnished Property (GFP).

Clauses and Provisions (continued)
Arranged by subject matter, this part is organized in the same order as, and keyed to, the other parts of the FAR.

For example, clause 52.243-1, Changes – Fixed Price, relates to FAR Part 43, Contract Modifications.

The FAR provision or clause number is then completed by a hyphen and a sequential number assigned with each section of Subpart 52.2. Directly following the title and date of the clause or provision is the prescription for the respective clause or provision. The prescription contains instructions to the contracting office for inserting a FAR clause or provision into a contract or solicitation.

Clause and Provisions Matrix

The clauses and provisions matrix lists the required and optional solicitation provisions and contract clauses. For each provision or clause listed, the matrix provides information on: * Whether incorporation by reference is or is not authorized * The section of the Uniform Contract Format (UCF) in which it is to be located (if it's being used in an acquisition that is subject to the UCF). * Its number * The citation of the FAR text that prescribes its use * Its title or full text Clause and Provisions MatrixIn the principle type and/or purpose of a contract section of the matrix, the letter P and C in the matrix indicate it is a provision or a clause respectively. The letter R in a column indicates that the provision or clause is required. The letter A indicates that the provision or clause is required if it applies. The letter O indicates that the use of the provision or clause is optional. | Forms | Included in FAR Part 53, Forms, there is an extensive collection of blank forms, both standard and optional, that are used in Federal Acquisition.

You can also find these forms by returning to the FAR Site and selecting one of the electronic forms libraries listed. Question 1 of 2 | Choose the answer that best fills in the blanks. Agency implementation guidance provides __________ information; agency supplementation guidance provides __________ information.

| | Expanded, new | | | Cost, new | | | New, expanded | | | Basic, expanded | | | |
Agency implementation guidance either expands upon or interprets information provided in the FAR, but agency supplementation guidance provides new information that has no counterpart in the FAR. | | |

Question 2 of 2 | Choose the answer that will best fill in the blank. Obtaining __________ __________ in accordance with the terms and conditions of the contract is a primary goal of government contracting.

| | Proper terms | | | Timely solicitation | | | Proper interpretation | | | Timely performance | | | |
One of the primary goals of Government contracting is to obtain timely performance in accordance with the terms and conditions of the contract. The FAR provides clauses and provisions to achieve this goal.

Administration and Updating of the FAR

The two groups that oversee the FAR are: 1. The Defense Acquisition Regulatory Council (DARC) 2. The Civilian Agency Acquisition Council (CAAC)
Each council is assigned primary responsibility for prescribed parts and subparts of the FAR. When one council develops a proposed amendment, it is referred to the other council for review and concurrence.

The FAR Secretariat, which is located within General Services Administration (GSA), provides administrative support. The Secretariat prints, publishes, and distributes the FAR.

Keeping Up with the FAR and DFARS

If you want to keep current with the changes to the FAR and DFARS, and you should, you can have them delivered to your computer via e-mail.

To subscribe to FAR updates: 1. Select FAR Updates 2. Enter your e-mail address 3. Enter your full name 4. Select the Subscribe radio button 5. Select Submit

To remain up-to-date with the changes to the DFARS, select DFARS News

Keeping Up with the FAR and DFARS (continued)

The Secretariat also provides the two councils with centralized services for: * Issuing Federal Register notices of proposed and final FAR rules * Preparing and issuing Federal Acquisition Circulars (FACs), which contain replacements for amended FAR pages (to register to receive FACs, select Federal Acquisition Circulars * Maintaining a synopsis of current FAR revisions and their status * Assigning FAR case numbers * Maintaining official files * Providing miscellaneous administrative support
For example, when a recommendation for amending the FAR is a result of a new statute, the proposed amendment is given a case tracking number. These are consecutively numbered, the first case initiated in calendar year (CY) 2011 is case 11-01.

Deviations and Approvals

When any solicitation provision or contract clause is inconsistent with the FAR, it is considered a deviation. FAR 1.401 provides the circumstances when an action is considered a deviation and provides the following definition. The deviation is any one or combination of the following:

* The issuance or use of a policy, procedure, solicitation provision, contract clause, method, or practice of conducting acquisition actions of any kind at any stage of the acquisition process that is inconsistent with the FAR. * The omission of any solicitation provision or contract clause when its prescription requires its use * The use of any solicitation provision or contract clause with modified or alternate language that is not authorized by FAR. * The use of a solicitation provision or contract clause prescribed by the FAR on a “substantially as follows “or “substantially the same as” basis if such use is inconsistent with the intent, principle, or substance of the prescription or related coverage on the subject matter in the FAR. * The authorization of lesser or greater limitations on the use of any solicitation provision, contract clause, policy, or procedure prescribed by the FAR. * The issuance of policies of procedures that govern the contracting process or otherwise control contracting relationships that are not incorporated into agency acquisition regulations.

Types of Deviations

1. Individual- Affect one contractor 2. Class- Affects more than one contractor


For deviations, the justification and agency approval shall be documented in the contract file. If any agency finds it will require a class deviation on a permanent basis, they should propose an appropriate FAR revision. For civilian agencies other than NASA, a copy of each approved class deviation shall be furnished to the FAR Secretariat.

For civilian agencies, other than NASA, agency heads or their designees may authorize class deviations. Delegation of this authority shall not be made below the head of a contracting activity.

Question 1 of 2 | Which two answers are indicative of a contract clause that is inconsistent with the FAR? Select all that apply.

| | Issuing policies and procedures for the contracting relationships that align with acquisition regulations | | | Omitting a required contract clause | | | Using a contract clause prescribed by the FAR on a "substantially as follows" basis that is consistent with the intent of the FAR | | | Authorizing fewer limitations on a contract clause than what is prescribed by the FAR | | | |
The omission of any contract clause when its prescription requires it use and authorizing lesser or greater limitations on the use of any contract clause prescribed by the FAR are indicative of a contract clause that is inconsistent with the FAR.

Question 2 of 2 | Select the name of the administrative support provider for the FAR.

| | Office of the Comptroller General | | | Defense Acquisition Regulatory Council (DARC) | | | FAR Secretariat | | | Civilian Agency Acquisition Council (CAAC) | | | |
The FAR Secretariat provides administrative support by printing, publishing, and distributing the FAR

| | | Structure and Maintenance of DFARS |

Defense Federal Acquisition Regulation Supplement (DFARS)

Department of Defense implementation and supplementation of the FAR is issued in the DFARS under authorization, and subject to the authority, direction, and control, of the Secretary of Defense.

To access the DFARS, first access the FAR website; then select the DFARS button.

Numbering System of the DFARS
2 add before the DFARS site
Implementation of the DFARS
The DFARS may either implement or supplement the FAR. Implement, as previously defined, means that the information in the FAR is expanded upon, further restricted, or otherwise interpreted in the DFARS.

For example, the FAR may mandate that agencies take a structured approach for determining profit to be given to contractors. When the DFARS gives specific guidance on the elements this structured approach should contain, it implements the FAR.

Supplementation of the DFARS FAR | Implemented As | Supplemented As | 19 | 219 | 219.70 | 19.5 | 219.5 | 219.570 | 19.501 | 219.501 | 219.501-70 | 19.501-1 | 219.501-1 | 219.501-1-70 | 19.501-1(a) | 219.501-1(a) | 219.501-1(a)(S-70) | 19.501-1(a)(1) | 219.501-1(a)(1) | 219.501-1(a)(1)(S-70) |

Administration of the DFARS
The DFARS is administered by the Defense Acquisition Regulations Council (DARC). The composition and operation of the DARC are prescribed in DOD Instruction 5000.63, the Defense Acquisition Regulations (DAR) System. Departments and agencies process proposed revisions of FAR or DFARS through appropriate channels to the Director of the DARC. * The proposed revision is processed as a memorandum addressed to the Director, DARC * The public may also offer proposed revisions of the DFARS by submission of a memorandum to the Director of the DARC * Defense Acquisition Circulars (DACs) are changes to the DFARS

Deviations and Approvals
Within the Department of Defense, the Director of Defense Procurement, Office of the Under Secretary of Defense (Acquisition, Technology, and Logistics), USD (AT&L) DP, is the approval authority for any individual or class deviation from: * Procurement Integrity (FAR 3.104 or DFARS 203.104) * Rights in Data and Copyrights (FAR 27.4 or DFARS 227.4) * Cost Accounting Standards Administration (FAR Part 30 or DFARS Part 230 * Contract Cost Principles Applicability (FAR 31.1 or DFARS 231.1) * Contracts with Commercial Organizations (FAR 31.2) * Contract Financing (FAR Part 32 or DFARS Part 232

Question 1 of 3 | In the case of the FAR having no guidance on a specific contract issue, the DFARS will __________ the FAR.

| | Supplement | | | Implement | | | Deviate | | | Approve | | | |
Supplementation is when the DFARS adds new information for which there is no counterpart in the FAR.

Question 2 of 3 | Which of the following organizations administers the DFARS?

| | Office of the Comptroller General | | | Defense Acquisition Regulatory Council (DARC) | | | FAR Secretariat | | | Civilian Agency Acquisition Council (CAAC) | | | |
The DFARS is administered by the Defense Acquisition Regulatory Council (DARC).

Question 3 of 3 | Which number below indicates that DFARS has supplemented the FAR?

| | 19.5 | | | 219.501 | | | 219.570 | | | 19.501-1(a) | | | |
Supplements to the FAR are easily detected as they are denoted by the addition of the number 70 or greater.

Strategic and Tactical Market Research
Terminal Learning Objective

Given a provided mission support area, conduct strategic or tactical market research.
Enabling Learning Objectives * Describe the characteristics of strategic and tactical market research. * Explain the benefits of conducting a market research. * Identify required sources for a supply or service. * Describe the procedures for using a qualified bidders list (QBL), qualified manufacturers list (QML), or qualified products list QPL). * Locate potential sources of information. * Analyze acquisition resources and market research information. * Apply performance assessment methods. * Justify the requirements for using the Economy Act.

Characteristics of Strategic and Tactical Market Research

Market Research Defined

Market research: * Used to collect information about the marketplace in order to meet an agency's needs for supplies or services * Designed to gather information about products, services, market capabilities, technology advances, business practices, and associated prices * Documentation and presentation of data required to facilitate procurement decisions

Team Approach

Team Composition

Team members should include, as appropriate, small business specialist, finance managers, program/requirements managers, users, logistics specialists, and contracting professionals, and could include non-Government participants such as industry representatives, potential vendors, and others, as needed.

Contracting Professionals Role

Contracting officers and other contracting professionals such as you, assist these teams by collecting market and product data from internal and external sources in order to: * Determine the availability of commercial items that can satisfy agency requirements * Identify standard commercial practices, terms, conditions, and other information that will help fashion an appropriate solicitation * Monitor the process for any impacts on competition * Identify small businesses capable of performing the requirement

Uses for Market Research Information

While market research benefits all players on the acquisition team, it especially benefits you the contracting professional and the requiring activities you support. The requiring activity benefits from market research by being able to shape the requirement based upon the availability of the market. You benefit by the ability to tailor the procurement to the market place.

Market research information can be used to develop the following: * Mission and operational requirements * System and design specifications * Support strategies and plans * Milestone decision documents * Type and content of the product descriptions * Statement of Work (discussed later) * Statement of Objectives (discussed later)
Integrated Product Teams

Agencies may also use IPT's to conduct market research or supplement existing market research teams. Members of an IPT represent technical, manufacturing, business, and support functions and organizations that are critical to developing (if necessary), procuring, and supporting a product.

Team Responsibilities

Together the team is responsible for: * Determining the information required * Gathering the information * Analyzing and presenting the information
Understanding the Commercial Marketplace

The team will expect you to understand the commercial marketplace and contribute to the acquisition strategy. They will also look to you, as a contracting professional, to tailor the procurement by providing information that helps in: * Developing the requirements documents * Analyzing the validity of the estimate * Identifying any special requirements * Identifying qualified sources (including small businesses) * Selecting the contract type and method of procurement * Selecting the evaluation criteria * Preparing the source selection plan * Preparing the solicitation Market Research Planning | You should plan market research team activities in advance, giving special consideration to: * Essential requirements * Alternatives and possible trade-offs * Methods for contacting potential suppliers * Techniques for handling initial and follow-up queries * Information given to and obtained from potential suppliersSuppliers

The use or anticipated use of required sources of supplies and services is another consideration that you should address in your early planning efforts. The Government has a preference regarding the use of these supplies and services. You will see required sources described in more detail later in the lesson.Information Given To and Obtained from Potential Suppliers

Your team may decide to furnish potential vendors with printed statements of the agency's needs and limit their initial data collection to available vendor publications covering product and pricing information. Your team may also plan to design a matrix for collecting information from the potential suppliers. Regardless of the approach, it is important to have a plan in place in order to generate commitment from all the team members to support the plan's execution. | |

Question 1 of 3 | Market research is a process used to collect information about the marketplace. It is also a __________ process that requires your __________ of the data.

| | Rigorous, photocopying | | | Decision, presentation | | | Continuous, documentation | | | Collection, judgment | | | |

Market research is a continuous process to gather information that requires you to document your collected data.

Question 2 of 3 Which of the following is NOT a team responsibility?

| | Analyzing and presenting the information | | | Updating policy to match the market | | | Gathering the information | | | Determining the information required | | | |
It is not the responsibility of the team to change governmental policy to align with the market. Question 3 of 3 | Why is it important for your customer that you plan your market research?

| | It is a logical and systematic approach to meet their needs. | | | It is a quick and systematic approach to meet their needs. | | | It is a methodical and rapid approach to meet their needs. | | | It is a logical and convenient approach to meet their needs. | | | | |
When you plan your market research, it allows you to put a logical and systematic approach in place to meet the needs of your customer.

Types of Market Research

1. Strategic 2. Tactical

Strategic Market Research

When conducting strategic market research, you seek to understand how commercial consumers other than the government: * Develop acquisition strategies * Communicate requirements * Determine evaluation criteria * Determine contractor incentive packages * Encourage commercial competition * Determine their contractor assessment metrics * Communicate source selection plans * Communicate solicitations * Evaluate cost/price * Award contracts * Evaluate contractor performance * Take advantage of other commercial business practices
Tactical Market Research

If commercial items exist, that meet your agency's requirements, the agency is required to purchase them rather than develop new items. Commercial items may satisfy agency requirements either "as is" or after modification.

Tactical market research can also determine whether your agency's requirements could be modified, to a reasonable extent, to allow the use of commercial items. It identifies information about available sources, available supplies and services, and industry trends.

Question 1 of 2 | Which of the following best describes tactical market research?

| | Broad and evaluative | | | Limited by technology | | | Continuous | | | Focused and detailed | | | |
Tactical market research is focused and detailed and is a response to a specific need.

Question 2 of 2

Which of the following items does strategic market research NOT help you understand about commercial business practices?

| | How they encourage commercial competition | | | How they determine website marketing strategies | | | How they evaluate cost and price | | | How they communicate requirements |
Strategic market research does not concern itself with how commercial businesses market their products on the Internet.Practical ExerciseIn this lesson, Mr. James Newman, being new to government procurement, knows that he must do market research as required by FAR Part 10 to: * Determine if sources capable of satisfying your agency's requirements exist * Determine if commercial items or, to the extent commercial items suitable to meet the agency's needs are not available, non-developmental items are available * Help identify the requirements to be included in contracts * Identify the capabilities of small businesses and new entrants into the marketplaceJames starts with determining the extent of the strategic market research the various IPT members have already done.James talked to the civil engineer (CE) on the team about past contracts for security fences and guardhouses. The CE tells him that there are two other buildings on the installation with security fences and controlled entry points. One building was installed just three years ago. The CE office maintains a list of construction contractors that have done business on the base or those that have sent their qualifications and asked to be included on all solicitations for their type of work. Two local firms could do the work, as well as six others in the state. James knows he will need to advertise the procurement in FedBizOpps to attract additional offerors. The CE office subscribes to RSMeans CostWorks.Com, which collects construction cost data from nearly every category of construction across the United States. James leaves the CE office feeling comfortable about obtaining good competition and cost estimates for the construction part of the project.

Later James will speak with the small business specialist, small business administration procurement center representative, competition advocate, and the information technology (IT) specialist about their knowledge of sources and qualifications for all the various parts of the effort. In his discussions with the Small Business Specialist and Procurement Center Representative, James should discuss whether small business would be capable of performing the work the contracts will require. He should also review past contract files for similar procurements.

James called Lt. Linda Appleton (the liaison for the procuring agency) about the need for the special software. She said it had been developed by a government federally funded research and development center (FFRDC) and would be furnished to the service contractor for installation, test and operation. It will be furnished to the contractor as government property.

Next, James needs to conduct tactical market research to focus on the particular contracts he needs to award. | | |
Can commercial sources satisfy the needs of this project?

| | Yes | | | No |
Based on the information provided about the requirements needed to meet the 38th Security Detachment needs the answer is Yes. Lt. Appleton indicated the special software been developed by a Federally Funded Research and Development Center (FFRDC) and would be furnished to the service contractor for installation, test and operation. It will be furnished to the contractor as government property |

Benefits of Conducting Market Research

Reasons for Conducting Market Research

Use market research to determine: * If there are sources capable of meeting the need (both large and small businesses) * If commercial items are available to meet the need * If requirements can be modified to permit the use of commercial or non-developmental items * The extent to which commercial or non-developmental items may be incorporated at the component level * Identifying the various standard practices of commercial firms engaged in producing, distributing and supporting commercial items, such as terms for warranties, buyer financing, maintenance, and packing and marking. * Assessing the acquisition strategies of commercial firms * Identifying normal distribution and logistics support capabilities of the commercial market
Acquisition Success
Market research: * Serves as the foundation for filling an agency's large or small requirements * Promotes a systematic approach to collecting, organizing, and maintaining information vital to the procurement * Facilitates the determination of the source and the product that best satisfy government requirements

Market research helps you succeed in doing the following: * Acquire and maintain better capabilities much faster and cheaper for the customers of the acquisition community * Obtain data that: * Provide information to support the development of acquisition requirements and strategies * Facilitate acquisition documentation leading to acquisition decisions * Satisfy federal mandates for assessing the commercial marketplace * Leverage commercial products and services in solving complex challenges in acquiring government capabilities Question 1 of 2 | You are on a team that has been tasked with research for a parts contract to cover a piece of equipment transferred from a closed military base. The machine is operational, and its original printed maintenance manuals and parts catalog are included — all printed 15 years ago. How would market research help you write the contract? Select the two answers that apply to your situation.

| | It would help me catalog the equipment into the database of my computer. | | | It would help me determine whether products or services are still available to support this piece of equipment. | | | It would help me identify logistics support capabilities for getting the parts to the equipment location. | | | It would help me find out how many of these were made originally. | | | |
Market research would help you determine whether support products and services are still available for this piece of equipment and how difficult it would be to arrange for the parts to be delivered to the equipment location. Question 2 of 2 | The success of your agency's acquisitions depends on how __________ and __________ you perform your research to assess the potential of the marketplace to meet performance requirements of the contracts.

| | Thoroughly, accurately | | | Quickly, cheaply | | | Specifically, logically | | | Continuously, quickly | | | |

The success of the acquisition depends upon the level and accuracy of the market research.

| Required Sources for a Supply or Service | | Getting Started – Receiving the User's Requirements |
Your participation on the market research team means that you should have a thorough understanding of the activity's requirement. This requirement is usually expressed as a general statement of the item's or service's intended use in terms of the: * Function to be performed * Performance requirement * Essential physical characteristics * Environment in which it will operate (if necessary)
Essential Physical Characteristics

Some requirements are critical and essential; others are desirable targets or objectives. Differences between these two categories should be made clear in the description. The requiring activity has substantial latitude in describing its needs in a manner that reflects an optimum acquisition strategy. However, you should advise the requiring activity that the description should be written in a manner that will promote competition to the maximum extent possible.

Unless they are essential, avoid restrictive provisions and features that are unique to specific products in the market
Government's Preference in Procuring Supplies and Services
The required sources were established to: * Use existing inventories * Take advantage of consolidated programs * Meet other requirements of law, such as socioeconomic programs, through the purchase of commercial-type goods and services
Required sources for supplies and services are listed in FAR 8.002. Whenever a purchase is required, select the proper source of supplies or services.

Requirements for supplies and services must be satisfied from or through the services and publications listed on the following screens in descending order of priority. First, we will look at the requirements for supplies. Then, we will look at the requirements for services.

First: Activity Inventory | The first source for supplies is on-hand stock. Items needed may be available from stocking facilities at local installations, regional stock centers, or headquarters.Second: Excess Personal PropertyThe second source for supplies is excess personal property. Whenever possible, it should be used instead of purchasing new property from other sources.

The General Services Administration (GSA) and Defense Reutilization Management Office (DRMO) publish electronic catalogs, which list the items available with instructions for ordering. You must check with the appropriate property management officer before making a purchase elsewhere. Third: Federal Prison IndustriesThe third source of supplies is Federal Prison Industries (FPI), which is also known as UNICOR. FPI produces common items such as brooms, brushes, furniture, clothing, textiles, and electrical equipment. Your procurement office has UNICOR's catalog or you can access UNICOR online.

You can find the conditions and procedures for buying from FPI in FAR 8.6 and DFARS 208.6.Fourth: Procurement Through Committee for Purchase
From People Who Are Blind or Severely Disabled | The fourth source for supplies comes from the distribution channels authorized by the Javits-Wagner-O'Day Act, 41 United States Code (USC) 46-48C. The Congressional Committee for Purchase from People Who Are Blind or Severely Disabled oversees the program. Items available from this source are published on the AbilityOne home page.

There are two national organizations developed from this Act: National Industries for the Blind (NIB) and National Industries for the Severely Handicapped (NISH).

These organizations have been designated to furnish office supplies and cleaners. They have also been designated to perform a wide array of services from administrative work, custodial operations, and grounds maintenance to order processing, switchboard operation, and warehousing.Javitis-Wagner-O'Day Program

This program creates employment and training opportunities for people who are blind or who have other severe disabilities. Its primary means of doing so is to require government agencies to buy selected products and services from nonprofit agencies employing such individuals. As a result, JWOD employees are able to lead more productive and independent lives.Supplies

A sample of some of the supplies and services offered are: * Office supplies (Skilcraft brand) * Medical and surgical supplies * Janitorial services * Temporary administration services * Commissary shelf-stocking servicesFifth: Wholesale Supply SourcesThe GSA supply catalog is published annually and updated quarterly. It is an illustrated book that serves as the primary source for identifying items and services offered from GSA supply sources. When an order is placed from GSA catalogs, adequate lead-time must be allowed for delivery. GSA requires 30 days or less to deliver standard stock items within a region. Furniture and other office equipment may take up to six months for delivery.

Delivery for items ordered could be determined in advance by calling the customer service number listed in the GSA catalog. GSA also offers an online shopping service called GSA Advantage and you can use the purchase card with this system.

The Department of Defense (DoD) has contracts for numerous supplies and services. Examples of their contracts can be seen at the DoD EMall. Sixth: Mandatory Federal Supply Schedules and Seventh: Optional Use FSS | The sixth source of supply is the Mandatory Federal Supply Schedule (FSS), managed and directed by GSA. The FSS provides federal agencies with a simplified process for obtaining commonly used commercial supplies and services at prices associated with volume buying. Mandatory schedules apply to executive agencies that are designated as mandatory users on each schedule. DoD is not a mandatory user unless the individual activity decides that requiring mandatory use of the schedule is in the DoD's best interest.Sixth: Mandatory Federal Supply Schedules and Seventh: Optional Use FSS (continued)All schedules contain general instructions, ordering instructions, a list of supplies and services, a list of contractors, and an index. You can view the schedules from the GSA web site. Once at this site, select Schedules E-Library and select View the Complete Federal Supply Schedule Listing.

The seventh source of supply is Optional Use FSS. If your agency is not specified in the individual schedules as a mandatory user, then it is an optional user. If a contractor accepts an order from an optional user under a schedule contract, all terms of the schedule contract apply to that order as if a mandatory user. Eighth: Commercial Sources | The eighth source for supplies is open-market commercial sources. This type of purchase is used only when the items requested are not available from the aforementioned sources. Question 1 of 1 | Water damage from a recent storm requires replacing some furniture items in a government official's office. The official has made it clear to the Acquisition Department that he wants a specific type of new furniture. How would you, as the contracting professional, handle the official's request?

| | Check the website for the brand of furniture the official wants so you can write the contract pricing accurately | | | Tell the official that you have no control over the kind of furniture you can order | | | Explain that you will research required sources of supply and try to obtain similar furniture to the desired type, but the restrictions will limit choices | | | State that only used furniture from the nearest Defense Reutilization Management Office (DRMO) can replace what was damaged | | | |
The first place you should check when conducting market research is the Federal Government's required sources of supply. | | | | | | | |
Government's Preference in Procuring Services

1. First: Services Available from the Committee for Purchase from People Who Are Blind or Severely Disabled

The first source for services is services available from the Committee for Purchase from People Who Are Blind or Severely Disabled.

2. Second: Mandatory FSS

The second source for services is Mandatory FSS. A listing is located in the FSS Program Guide. Again, individual DoD activities have the authority to enforce the mandatory use of these schedules to suit their best interests.

3. Third: Optional Use FSS

The third source for services is Optional Use FSS.

4. Fourth: Federal Prison Industries (FPI)

The fourth source for services is FPI/UNICOR. This source is for services not available on the open-market. For commercial services this source does not have priority over the procurement of services.

5. Fifth: Open-Market Commercial Sources

The fifth source for services is open-market commercial sources, only when the service requested is not available from the first three aforementioned sources. Commercial sources and FPI/UNICOR have equal priority for the procurement of services.

Customer Education

Commercial Items

The Federal Acquisition Streamlining Act of 1994 (FASA) established a very broad definition of commercial items and created a statutory preference for their acquisition by federal agencies.

A commercial item is defined in FAR 2.101. Generally speaking, it states that a commercial item is any item, other than real estate, that is customarily used by or available to the general public.

Price Reasonableness of Commercial ItemsThe policies and procedures pertaining to the acquisition of commercial items are described in FAR Part 12. You should note that FAR 12.209 tells you to establish price reasonableness in accordance with FAR 13.106-3, FAR 14.408-2, and FAR 15.4, as appropriate.

You should be aware of customary terms and conditions when pricing commercial items. Prices are often affected by factors that include: * Speed of delivery * Length and extent of warranty * Quantities ordered * Length of the performance period * Special performance requirementsYou should ensure that the terms, conditions, and fair and reasonable prices are commensurate with the Government's | Requirements to use Market ResearchSeveral references describe requirements to use market research, including: FAR 10.001, FAR Part 11, FAR 7.102, and FASA. 1. FAR 10.001

FAR 10.001 tells you that market research, in some form, is done for all acquisitions. The dollar amount and the complexity of the acquisition will determine the extent and nature of the market research performed. 2. FAR Part 11

FAR Part 11 instructs you to require contractors to incorporate commercial items as parts and components of systems developed for Government use. 3. FAR 7.102

Market research is also prescribed in FAR 7.102 in order to promote and provide for the acquisition of commercial items and promote competition. The FAR mandates that you use market research when the following circumstances occur: * Develop new requirements for an acquisition * Acquisitions estimated to exceed the Simplified Acquisition Threshold * Circumstances justify the cost * Not enough information on hand to adequately support a decision for an acquisition under SAT 4. FASA

Market research was specifically identified by FASA as the method to determine the availability of suitable commercial items in the marketplace that exceed the Simplified Acquisition Threshold (SAT). If market information is needed for a purchase expected to be below the SAT, then cost of gathering it must be considered and compared to the anticipated value of the informationFASA requires that federal agencies, to the extent practicable: * Buy commercial items and services to meet agency needs * Require prime contractors and subcontractors at all levels to incorporate commercial items as components of systems they develop for federal agencies * State specifications in terms that enable and encourage companies to supply commercial items * Revise procurement policies, practices, and procedures-not required by law-to remove impediments to the acquisition of commercial items Question 1 of 2 | As defined by FAR 2.101, commercial items, excluding real estate, are customarily used or available to the general public; however, many factors affect the pricing. Therefore, you should establish price __________ before you buy commercial.

| | Needs | | | Reasonableness | | | Terms | | | Justification | | | | | FAR also directs you to establish price reasonableness as appropriate when pricing commercial items Question 2 of 2Select the item below that is NOT one of the reasons that contracting professionals like you are required to use market research.

| | To ensure that expensive technological office systems are being used | | | To promote competition | | | To aid in the development of new acquisition requirements | | | | To incorporate commercial parts into government-developed systems |
Ensuring expensive technological office systems are being used is not a reason you are required to do market research.Practical ExerciseAs part of his tactical market research, James has reviewed the required sources for supply and services listed in FAR Part 8 to determine from which source he would purchase each item. The security fence and guard house would need to be purchased from commercial sources using either sealed bidding in FAR Part 14, or negotiation in FAR Part 15. | | | | | | Practical Exercise (continued) | | | What method of contracting should be used for construction projects if the conditions in FAR Part 6.401(a) apply?

| | Sealed bidding | | | Open bidding | | | Federal Service Schedule | | | Negotiation | | | |
FAR Part 36.103(a) states that contracting officers shall use sealed bid procedures for a construction contract if the conditions in 6.401(a) apply.For the computers, office supplies, and service contract, James need to determine the availability of these items through the required sources of supplies and services. Where are these listed in priority order?

| | FAR Part 6 | | | FAR Part 7 | | | FAR Part 8 | | | FAR Part 10 |
They are listed in FAR Part 8. | |
James contacted the installation supply office about the availability of the items he needed. Because of the availability of commercial items through GSA and other government-wide contracts, the office did not stock the items in the quantities he needed.

James then contacted the installation property management officer (PMO) to determine if property was available from other agencies (see Subpart 8.1). The PMO reviewed the GSA and Defense Reutilization Management Office (DRMO) electronic catalogs and found that James' requirements could not be met.

Finally, James referenced the UNICOR on-line catalog and determined that furniture items were a possibility (see Subpart 8.6). He checked DFARS 208.6 to determine whether the furniture could be a direct buy from UNICOR or if the furniture had to be competed.

Is the furniture an item that must be competed rather than a direct buy from UNICOR?

| | Yes | | | No |

James may use UNICOR for this acquisition because in this case, UNICOR does not have 5% or more of the market and direct procurement with UNICOR under the procedures in FAR 8.602 is authorized.

James contacted UNICOR about delivery within 8-10 weeks and was told they could meet the requirement for 50 office units. James has decided that he will use this source unless Lt. Appleton provides requirements that UNICOR cannot meet in a timely manner.

Items available from the procurement list maintained by the Committee for Purchase From People Who Are Blind or Severely Disabled (see Subpart 8.7) are published on the AbilityOne home page.
After a review of the AbilityOne home page, James determined he could buy what type of product?

| | Office supplies | | | Alarm systems | | | Computers | | | Fencing |
James determined he can obtain office supplies from the AbilityOne home page

Wholesale supply sources, such as stock programs of the GSA (see 41 CFR 101-26.3), the Defense Logistics Agency (see 41 CFR 101-26.6), the Department of Veterans Affairs (see 41 CFR 101-26.704), and military inventory control points: Since James determined he could obtain the supplies he needed from a higher priority source, he did not review these sites.

Mandatory Federal Supply Schedules (see Subpart 8.4): James determined that DoD was not a mandatory user and the installation also decided it would not be a mandatory user. Therefore, James could use the Federal Supply Schedules as an optional user or go directly to the commercial market.

Optional use Federal Supply Schedules (see Subpart 8.4): James decided to use commercial sources for his services contract.

Commercial sources (including educational and nonprofit institutions): James would need to check the availability of small business sources before he could use full and open competition. He would check with the Small Business Specialist for firms that could meet the security requirements.

Procedures for using a Qualified Bidders List (QBL), Qualified Manufacturers List (QML), or Qualified Product List (QPL)

Preparing to Buy Commercial Items

QBL, QML, and QPL | The qualified bidders list (QBL), qualified manufacturers list (QML), and qualified products list (QPL) contain bidders, manufacturers, and products that are covered by a specific government/military specification and not readily available in the commercial marketplace. Members and products on these lists have been examined and tested, and satisfy all of the applicable qualification requirements. As a result, you are limited to buying from these lists to support certain requirement specifications.

The Defense Logistics Agency (DLA) is an example of an agency that uses QBLs, QMLs, and QPLs daily due to their unique systems support mission. This is because the weapons systems that the DLA supports contain unique military specifications. As a result, only qualified manufacturers/bidders are allowed to make products for DLA, and submit proposals on certain DLA buys.QBL, QML, and QPLThe use of such a list by an organization does not connote endorsement of the product or manufacturer by the using agency. Due to the potential impact on competition, your customer organization must prepare a written justification stating the necessity for the requirement and why the requirement must be demonstrated before contract award.

FAR 9.202 outlines the policy and procedures for using these qualification lists. | |

Question 1 of 1 If you, as an acquisition professional, must choose to buy an item from a QBL, QML, or QPL, what does this indicate about the item that you must buy?

| | It is made by so many commercial producers that the Government has had to limit the number of companies you can consider for your purchase

| | | It has been subject to after-market manufacture outside of the United States, so the Government has made a list of qualified manufacturers in this country from which you can buy

| | | It is no longer available, but there are a few warehouses that still have some in stock, so you may buy from them

| | | It has very specific and unique requirements and you may only buy from certain organizations that have passed the tests to meet those requirements | | | |
Members and products on these lists have been examined and tested and satisfy all of the applicable qualification requirements; you are limited to buying from these lists to support certain requirement specifications |

Potential Sources of Information

1. Catalogs, Trade Shows and Expositions, Periodicals and Internet Sources * Product descriptions * Detailed specifications * Pictures * Prices and quantity discounts * Minimum order requirements * Delivery data * Points of contact for quotes and orders 2. Government Buyers * Information on similar purchases * Identification of potential sources * Capabilities of potential sources * Performance assessments 3. Industry Buyers * Identification of price drivers * Information on production capabilities 4. Suppliers * How many sellers are in the market? * How many buyers? 5. Trade and Professional Organizations * Strengths and weaknesses of products * Comparisons * Pricing * Warranty provisions 6. Non-Profit Organizations * Results of product tests Question 1 of 1 | Which of the following are your best sources of unbiased information about product performance?

| | Trade shows, expositions, the Internet | | | Trade and professional organizations, non-profit organizations | | | Suppliers, catalogs | | | Government and industry buyers | | | |
Non-profit organizations and trade and professional organizations can provide you with unbiased results of product testing and information on the strengths and weaknesses of products.

Practical Exercise

Identify potential sources of information: James reviewed the contracting office files for catalogs and information submitted by offerors and potential offerors in the past. He asked his integrated product team (IPT) members to review and provide information that they had collected on various sources. He asked other contracting officers in the office to provide information on other buys and to identify potential sources. He reviewed past performance reports in the Past Performance Information Retrieval System (PPIRS), as well as the Federal Awardee Performance and Integrity Information System (FAPIIS) per FAR 9.104-6 on the sources he had identified to date.

Acquisition Resources and Market Research Information

Acquisition Histories

Materials found in acquisition files include: * Contract award date and the contractor name * Procurement method and contract type * Award price and delivery terms * Product descriptions * Competition (degree of) * Descriptions of any pre or post-award problems

Contract files may also document: * The rationale for determining that the terms and conditions were consistent with standard commercial practice * Supporting documentation of negotiations that lead to acceptance of the terms and conditions * Tailoring of provisions or clauses agreed to by the parties

Questions that Should Be Asked 1. Demand * How much was acquired? * When did the acquisition take place? * What were the market conditions at the time?

2. Prices * What was the contract price? * How did unsuccessful offers compare?

3. Costs * What were the costs involved? * Were there any start-up costs?

4. Sources * How many sources were solicited? * How many offered bids/proposals? * What are those specific sources? * What were the results of any synopses?

5. Product Characteristics * How well did the product meet the agency needs? * Were the items or services competitive? * Are there any differences in what we need now? 6. Delivery * What was the delivery or performance period? * Did the vendor meet the delivery dates? * What was the shipping arrangement? * Was premium transportation required? 7. Acquisition Method * What acquisition method and contract type was used? 8. Contract Terms and Conditions * What were the general terms? * Are there any significant differences required now? 9. Problems * Were there any comments or complaints? * What problems did the agency encounter? * How were problems resolved?

Internet-Based Sources

Website Name | URL | Federal Business Opportunities (FedBizOpps) | | Thomas Register | | Department of Commerce | | Federal Supply Schedules | | Small Business Administration | | National Contract Management Association | | Dow Jones Business Information Services | | Stock, Commodity, Technical Analysis | | Google Search | | National Yellow Pages | |

Question 1 of 1 | The new Supply Officer at a local military base contacts you about some prior acquisition products and wants you to research the contract files. What questions would be appropriate for you to ask yourself as you are reviewing the old files? Select all that apply.

| | What were the market conditions at the time? | | | Why would the Supply Officer want to reinstate these products? | | | How well did the product meet the agency needs? | | | What kind of complaints or problems did these products cause (so that the agency discontinued them)? | | | What are the capabilities of potential sources? | | | Are there minimum order requirements?It is appropriate for you to question prior market conditions, product ability to meet agency needs, and product problems that led to the termination of acquisition. | | | |
Practical Exercise

James reviewed the historical contract files on similar acquisitions and made notes on the: * Procurement method * Contract type * Terms and conditions * Clarity of the statement of work * Prices paid versus the government estimates

His integrated product team (IPT) members provided him significant information

Which four pieces of information does James still need to look for in the acquisition histories? Select all that apply.

| | Acquisition method | | | Demand | | | Delivery | | | Product characteristics | | | Problems | | | Sources |

James still needs information about demand, delivery, problems, and sources.

Performance Assessment Methods

Assessment Methods

* How do you write your requirements? * How do you write your solicitations? * What incentives do you use for your contractors? * How do you write your evaluation criteria? * How do you write and evaluate your performance metrics? * How do you manage cost, schedule, and performance? * How do you track trends in the marketplace?

* Telephone calls * Comprehensive questionnaire sent to a group of potential suppliers * Use of a website to identify the requirement and solicit vendor information * The test and evaluation of product samples * Personal contact by telephone or at trade or professional shows * Interview current users * On-site inspections

Question 1 of 1 You know that assessing the performance of any supplier or vendor is critical to a successful acquisition. Which of the following questions is NOT a question that would help you understand best assessment practices in industry?

| | How do you track trends in the marketplace? | | | How do you write your evaluation criteria? | | | How do you locate overseas suppliers? | | | What incentives do you use for your contractors? | | | |
The location of a supplier seldom provides you with a means to assess performance.Practical ExerciseJames decided to invite potential offerors for the service contract and the security fence/guardhouse contracts to informal requirements definition and contract formation meetings. These are free exchange of ideas meetings where the offerors can provide advice and suggestions to the Government on how to write performance requirements, comments on prior unnecessary or burdensome solicitation requirements, and how they would like to see the evaluation criteria written. The Government could use the information as it desired. This was a very successful tactic on the Pentagon Renovation Project, and provided many innovative solutions that the Government had not used in contracts before.

What types of questions should James ask of the potential offerors at the contract formation meetings? Write a list of questions that you would want answers for if you were in his situation.Practical Exercise (continued)Questions James should seek answers to include, but are not limited to, the following: * How do you write your requirements? * How do you write your solicitations? * What incentives do you use for your contractors? * How do you write your evaluation criteria? * How do you write and evaluate your performance metrics? * How do you manage cost, schedule, and performance? * How do you track trends in the marketplace? |
The Requirement of Using the Economy Act

Interagency Acquisitions under the Economy Act

Interagency Acquisitions under the Economy Act are governed by FAR 17.500 and DFARS 217.500.

Interagency Acquisition Procedures
An interagency acquisition means a procedure by which an agency needing supplies or services, referred to as the requesting agency (Requesting Agency flys in and stays on upper left part of screen.), obtains them from another agency, referred to as the servicing agency (Servicing Agency flys in and stays on upper right part of screen. Arrow labeled Supplies goes from Servicing Agency to Requesting Agency). An example of the Economy Act is the Department of Homeland Security (Department of Homeland Security logo flys in and stays on lower left part of screen, below requesting agency.) desires the Department of Defense (DOD logo flys in and stays on lower right part of screen below Servicing Agency. Arrow labeled Classified Software goes from DOD logo to DOHS logo) to purchase unique or classified software.

Authority for Orders between Major Organizational Units

The Economy Act also provides authority for the placement of orders between major organizational units. The Economy Act applies when more specific statutory authority does not exist.

Examples of interagency acquisitions to which the Economy Act does not apply include acquisitions from required sources of supplies prescribed in FAR Part 8, Required Sources, which has separate statutory authority.

Documenting the Contract File with a Determination and Finding (D&F) * The use of an interagency acquisition is in the best interest of the government * The supplies or services cannot be obtained as conveniently or economically by contracting directly with a private source Question 1 of 1 | Which of the following correctly describes the authorization of the Economy Act?

| | Authorizes interagency acquisition agreements when they are more economical than a private source contract | | | Authorizes buying products from other than required sources when it is more economical for the agency | | | Authorizes procurement of civilian services when they are more economical than using military personnel | | | Authorizes interagency agreements when the product prices are so economical that the requesting agency does not have to reimburse the servicing agency | | | |
The Economy Act authorizes one agency (the requesting agency) to enter into agreements with other agencies (servicing agencies) to obtain supplies or services by interagency acquisition when doing so would be more economical than contracting directly with a private source.

Practical Exercise

Justify the requirements for using the Economy Act: The Economy Act requires a Determination and Findings (D&F) that purchasing from or through another agency is in the best interest of the requiring agency. The DoD has not done this for Department for Federal Supplies Schedules (FSS) buys, but allows individual activities to prepare a D&F. In this case, James does not anticipate buying any of his procurement items from another agency.

But let's imagine that James may decide to acquire the necessary software via the National Security Agency, because they already have a contract for a software product that does what the 38th Security Detachment needs it to do.

Practical Exercise (continued) | | | What does James need to prepare in order to conduct an interagency acquisition under the Economy Act?

| | Determination and Findings | | | Specification and Justifications | | | Tactical Market Research Report | | | Qualification Statement | | | |
James must prepare a Determination and Findings (D&F) to document the contract file

Practical Exercise (continued) | | | Identify the two selections that the Determination and Findings document has to state. Select all that apply.

| | Description of the product/service to be acquired | | | Cost estimate of the product/service to be acquired | | | Statement that the use of an interagency acquisition is in the best interest of the government | | | Statement that the supplying agency has guaranteed cost savings over direct contracting with a private source | | | Statement that the supplies or services cannot be obtained as conveniently or economically by contracting directly with a private source | | | |
A D&F must include a statement that the use of an interagency acquisition is in the best interest of the government and a statement that the supplies or services cannot be obtained as conveniently or economically by contracting directly with a private source.

* Characteristics of strategic and tactical market research * Benefits of conducting a market research * Required sources for a supply or service * Procedures for using a Qualified Bidders List (QBL), Qualified Manufacturers List (QML), or Qualified Products List (QPL) * Potential sources of information * Acquisition resources and market research information * Performance assessment methods * Requirements for using the Economy Act

Requirements Documents for an Acquisition

Terminal Learning Objective

Given a customer need, reinforce areas of mutual interest within an acquisition environment (requiring activity, contractor, contracting office, others).
Enabling Learning Objectives * Apply the factors in development of your mission support strategy. * Apply the key characteristics for successful customer relationships. * Apply the Seven-step Path to Better Decisions.

Various Issues and Elements Considered when Developing Requirements Documents

Relationship of Market Research and the Requirements DocumentsProperly drafted requirements documents will assist you in determining whether a requirement will be satisfied by a commercial or noncommercial product or service. These documents will also provide you with the widest area of competition.Requirements Documents DefinedA simple definition for requirements documents would be a description of the design or performance required. In other instances the requirements documents may identify the essential physical and functional characteristics needed to satisfy the customer.Contracting Terms Related to Requirements CDRL/DID | A contract data requirements list (CDRL) describes all the data that must be provided as deliverables under the contract.

A data item description (DID) provides instructions on the format and timeframe of data submissions.Commercial ItemTake a moment to review the definition of commercial items in FAR 2.101Commercial item” means --(1) Any item, other than real property, that is of a type customarily used by the general public or by non-governmental entities for purposes other than governmental purposes, and--(i) Has been sold, leased, or licensed to the general public; or,(ii) Has been offered for sale, lease, or license to the general public;(2) Any item that evolved from an item described in paragraph (1) of this definition through advances in technology or performance and that is not yet available in the commercial marketplace, but will be available in the commercial marketplace in time to satisfy the delivery requirements under a Government solicitation;(3) Any item that would satisfy a criterion expressed in paragraphs (1) or (2) of this definition, but for --(i) Modifications of a type customarily available in the commercial marketplace; or(ii) Minor modifications of a type not customarily available in the commercial marketplace made to meet Federal Government requirements. Minor modifications means modifications that do not significantly alter the nongovernmental function or essential physical characteristics of an item or component, or change the purpose of a process. Factors to be considered in determining whether a modification is minor include the value and size of the modification and the comparative value and size of the final product. Dollar values and percentages may be used as guideposts, but are not conclusive evidence that a modification is minor;(4) Any combination of items meeting the requirements of paragraphs (1), (2), (3), or (5) of this definition that are of a type customarily combined and sold in combination to the general public;(5) Installation services, maintenance services, repair services, training services, and other services if-- (i) Such services are procured for support of an item referred to in paragraph (1), (2), (3), or (4) of this definition, regardless of whether such services are provided by the same source or at the same time as the item; and(ii) The source of such services provides similar services contemporaneously to the general public under terms and conditions similar to those offered to the Federal Government;(6) Services of a type offered and sold competitively in substantial quantities in the commercial marketplace based on established catalog or market prices for specific tasks performed or specific outcomes to be achieved and under standard commercial terms and conditions. For purposes of these services—(i) “Catalog price” means a price included in a catalog, price list, schedule, or other form that is regularly maintained by the manufacturer or vendor, is either published or otherwise available for inspection by customers, and states prices at which sales are currently, or were last, made to a significant number of buyers constituting the general public; and(ii) “Market prices” means current prices that are established in the course of ordinary trade between buyers and sellers free to bargain and that can be substantiated through competition or from sources independent of the offerors.(7) Any item, combination of items, or service referred to in paragraphs (1) through (6) of this definition, notwithstanding the fact that the item, combination of items, or service is transferred between or among separate divisions, subsidiaries, or affiliates of a contractor; or(8) A nondevelopmental item, if the procuring agency determines the item was developed exclusively at private expense and sold in substantial quantities, on a competitive basis, to multiple State and local governments. | | | Commercial Item (continued)A minor modification means any modification that does not: * Significantly alter the non-governmental function or essential characteristics of an item or component * Change the purpose of the process Factors to be considered in determining whether a modification is minor include the value and size of the modification and the comparative value and size of the final product. Dollar values and percentages may be used as guideposts, but are not conclusive evidence that a modification is minor.

Unlike non-commercial procurements, contractors are under no obligation to modify their products to meet your customers' changing requirements. If an item is commercial, all modifications must occur solely through a bi-lateral agreement. For more information, see DAU Continuous Learning Modules CLC020 and CLC023, available though the DAU Knowledge Sharing Web site. | |
Determination and Findings determination and findings (D&F) is in two parts: Part 1: | List of facts that lead to the decision.
These are the findings. | Part 2: | The actual decision.
This is called the determination. |

Justification and Approval | Generally, a justification and approval (J&A) is only applicable in situations requiring approval for an other-than-full-and-open competition acquisition. The authority to approve this type of acquisition may be at a higher level than the contracting officer.

A justification for the other-than-full-and-open competition (JOFOC) acquisition is provided by the requiring activity. The information in the justification is used to support the decision in which competition is not appropriate for a particular acquisition. If this is a large procurement, it might be in the form of a J&A. On smaller procurements, the required documentation is less formal, and the format differs by contracting office.Non-Developmental ItemA non-developmental item is any previously developed item of supply used exclusively for governmental purposes by a federal agency, a state or local government, or a foreign government with which the United States has a mutual defense cooperation agreement. Purchase Request or Procurement Request (PR)The purchase request or procurement request (PR) should have the following essential elements: * Description of what is to be acquired * Fund citation or other statement of fund availability * Date the items or services is required * Location where the items or services are to be delivered or performed * Point of contact in the requiring activity * Authorized signatures as required * Any other information that will be helpful to the contracting office in processing the PRA priority designator may also be included in the package for the Department of Defense (See FAR 11.600). PR (continued) | Incomplete packages are a fact of life. Contract professionals must recognize when a package is incomplete. They must also work to educate the requestor or customer about the contents required to complete a PR package. PWS/SOO | On the simplest acquisitions, the description on the PR could be sufficient to describe the product or service. However, most acquisitions will require a separate document to provide an adequate description.

If the description is unclear to you, it may not be clear to the contractor who is expected to provide the supply or service. Question 1 of 2 | What purpose do the requirements documents serve?

| | Describes the type of contract that will be required for the acquisition | | | Provides a list of required references that will apply to the contract | | | Describes and/or specify the product and services to be acquired by the contract | | | Provides a list of required sources to be included in the contract | | | |
Requirements documents are attached to the purchase request and describe and/or specify the products or services to be acquired | | | | Question 2 of 2 | While preparing to begin work on a services contract, you reviewed the acquisition history of the service provider. One prior contract required the contracting officer to make some business decisions relating to the acquisition of the services. Which of the following documents describes these decisions?

| | Performance work statement | | | Determination and findings | | | Procurement request | | | Statement of objectives | | | |
Determination and findings is a two-part document that provides the rationale for acquisition-related business decisions: the findings (facts that led to the decision) and the determination (the actual decision). Responsibilities of the Business AdvisorTake a few minutes to review FAR 11.002. |
) In fulfilling requirements of 10 U.S.C. 305(a)(1), 10 U.S.C. 2377, 41 U.S.C. 253a(a), and 41 U.S.C. 264b, agencies shall—(1) Specify needs using market research in a manner designed to—(i) Promote full and open competition (see Part 6), or maximum practicable competition when using simplified acquisition procedures, with due regard to the nature of the supplies or services to be acquired; and(ii) Only include restrictive provisions or conditions to the extent necessary to satisfy the needs of the agency or as authorized by law.(2) To the maximum extent practicable, ensure that acquisition officials --(i) State requirements with respect to an acquisition of supplies or services in terms of—(A) Functions to be performed;(B) Performance required; or(C) Essential physical characteristics;(ii) Define requirements in terms that enable and encourage offerors to supply commercial items, or, to the extent that commercial items suitable to meet the agency’s needs are not available, nondevelopmental items, in response to the agency solicitations;(iii) Provide offerors of commercial items and nondevelopmental items an opportunity to compete in any acquisition to fill such requirements;(iv) Require prime contractors and subcontractors at all tiers under the agency contracts to incorporate commercial items or nondevelopmental items as components of items supplied to the agency; and(v) Modify requirements in appropriate cases to ensure that the requirements can be met by commercial items or, to the extent that commercial items suitable to meet the agency’s needs are not available, nondevelopmental items.(b) The Metric Conversion Act of 1975, as amended by the Omnibus Trade and Competitiveness Act of 1988 (15 U.S.C.205a, et. seq.), designates the metric system of measurement as the preferred system of weights and measures for United States trade and commerce, and it requires that each agency use the metric system of measurement in its acquisitions, except to the extent that such use is impracticable or is likely to cause significant inefficiencies or loss of markets to United States firms. Requiring activities are responsible for establishing guidance implementing this policy in formulating their requirements for acquisitions.(c) To the extent practicable and consistent with Subpart 9.5, potential offerors should be given an opportunity to comment on agency requirements or to recommend application and tailoring of requirements documents and alternative approaches. Requiring agencies should apply specifications, standards, and related documents initially for guidance only, making final decisions on the application and tailoring of these documents as a product of the design and development process. Requiring agencies should not dictate detailed design solutions prematurely (see 7.101 and 7.105(a)(8)).(d) (1) When agencies acquire products and services, various statutes and executive orders (identified in part 23) require consideration of sustainable acquisition (see subpart 23.1) including--(i) Energy-efficient and water-efficient services and products (including products containing energy-efficient standby power devices) (subpart 23.2);(ii) Products and services that utilize renewable energy technologies (subpart 23.2);(iii) Products containing recovered materials (subpart 23.4);(iv) Biobased products (subpart 23.4);(v) Environmentally preferable products and services, including EPEAT-registered electronic products and non-toxic or low-toxic alternatives (subpart 23.7); and(vi) Non-ozone depleting substances (subpart 23.8).(2) Unless an exception applies and is documented by the requiring activity, Executive agencies shall, to the maximum practicable, require the use of products and services listed in paragraph (d)(1) of this section when--(i) Developing, reviewing, or revising Federal and military specifications, product descriptions (including commercial item descriptions), and standards;(ii) Describing Government requirements for supplies and services; and(iii) Developing source-selection factors.(e) Some or all of the performance levels or performance specifications in a solicitation may be identified as targets rather than as fixed or minimum requirements.(f) In accordance with Section 508 of the Rehabilitation Act of 1973 (29 U.S.C. 794d), requiring activities must prepare requirements documents for electronic and information technology that comply with the applicable accessibility standards issued by the Architectural and Transportation Barriers Compliance Board at 36 CFR part 1194 (see Subpart 39.2).(g) Unless the agency Chief Information Officer waives the requirement, when acquiring information technology using Internet Protocol, the requirements documents must include reference to the appropriate technical capabilities defined in the USGv6 Profile (NIST Special Publication 500-267) and the corresponding declarations of conformance defined in the USGv6 Test Program. The applicability of IPv6 to agency networks, infrastructure, and applications specific to individual acquisitions will be in accordance with the agency’s Enterprise Architecture (see OMB Memorandum M-05-22 dated August 2, 2005).(h) Agencies shall not include in a solicitation a requirement that prohibits an offeror from permitting its employees to telecommute unless the contracting officer executes a written determination in accordance with FAR 7.108(a).Responsibilities of the Business Advisor (continued)An example of restrictive language would be to specify a requirement for a Ford truck when the requirement could be met by many other brands of trucks.

As a business advisor, you must document any changes and decisions made throughout the preparation process. This documentation should become a part of the contract fileAs a business advisor, you should provide guidance on factors such as: * Reasonable delivery terms * Acceptance criteria * Contract administration requirements * Packaging and marking requirementsOther Considerations that Affect Requirements DocumentsThere are other considerations that affect requirements documents, including: * Best commercial practice * Liquidated damages * Variation in quantity * Greening of governmentBest Commercial PracticeCommercial practices will often meet our needs, so you should use them whenever possible.

When selecting a best practice, be reasonably sure it will satisfy your customer's requirements.Liquidated DamagesClauses for liquidated damages are important. For example, when DAU contracted for additional classroom space, a date for completion was established. We then built our class schedule around that completion date. What happens if the classrooms are not ready in time for the first class? More than likely DAU would contract for another space to meet the class schedule.

If we included liquidated damages in our requirements we could recover any additional cost related to the contractor's failure to meet the contract schedule. Contractors understand this clause will add cost risk to the project. Subsequently, the prices of the bids will very likely increase in order to compensate for this perceived risk. Variation in QuantityTake a moment to read FAR 11.7 on the subject of variation in quantity (VIQ). |
Subpart 11.7 -- Variation in Quantity11.701 -- Supply Contracts.(a) A fixed-price supply contract may authorize Government acceptance of a variation in the quantity of items called for if the variation is caused by conditions of loading, shipping, or packing, or by allowances in manufacturing processes. Any permissible variation shall be stated as a percentage and it may be an increase, a decrease, or a combination of both; however, contracts for subsistence items may use other applicable terms of variation in quantity.(b) There should be no standard or usual variation percentage. The overrun or underrun permitted in each contract should be based upon the normal commercial practices of a particular industry for a particular item, and the permitted percentage should be no larger than is necessary to afford a contractor reasonable protection. The permissible variation shall not exceed plus or minus 10 percent unless a different limitation is established in agency regulations. Consideration shall be given to the quantity to which the percentage variation applies. For example, when delivery will be made to multiple destinations and it is desired that the quantity variation apply to the item quantity for each destination, this requirement must be stated in the contract.(c) Contractors are responsible for delivery of the specified quantity of items in a fixed-price contract, within allowable variations, if any. If a contractor delivers a quantity of items in excess of the contract requirements plus any allowable variation in quantity, particularly small dollar value overshipments, it results in unnecessary administrative costs to the Government in determining disposition of the excess quantity. Accordingly, the contract may include the clause at 52.211-17, Delivery of Excess Quantities, to provide that --(1) Excess quantities of items totaling up to $250 in value may be retained without compensating the contractor; and(2) Excess quantities of items totaling over $250 in value may, at the Government’s option, be either returned at the contractor’s expense or retained and paid for at the contract unit price. Variation in Quantity (continued) | In supply contracts, the VIQ clause is intended to allow for variations due to factors such as: * Condition of shipping * Condition of packaging * Normal anticipated losses in the manufacturing processes In construction contracts, the VIQ clause is used to allow variation in estimated quantities of unit-priced items. In other words, this clause is used when the actual requirements cannot easily be pre-determined. Greening of the Government | Greening of the government is a policy intended to help protect our environment through reuse of discarded material and preservation of resources. Spend a few minutes and review the implementation guide for this Executive Order (EO).

The government is requiring contracting officers to consider establishing greening policies and are rewarding the positive effects of the greening initiatives the contractors do establish and use. Even though establishing greening requirements is likely to add cost to the procurement, the government is encouraging innovation and is willing to reward contractors for positive efforts in the direction of greening. Types of Requirements DocumentsThere are five basic types of requirements documents. 1. CID 2. Performance Work Statement (PWS) or Statement of Objectives (SOO) 3. Specification 4. Industry Standard 5. Government Standards | Commercial Item Descriptions | The first type of requirements documents is a commercial item description (CID). CIDs are normally used for commercial items that are purchased on a repetitive basis. The user's requirement, market research, and coordination with industry form the basis for the development of the CID.

The CID represents physical/functional characteristics of a commercial or commercial-type product; for example: A50452, Life Preserver, Vest, Adult or Child. Performance Work Statement | The second type of requirements document is the Performance Work Statement (PWS) or Statement of Objectives (SOO). These documents describe a performance outcome rather than how to achieve that outcome.

For example: * Maintain grass between 2" and 4" * Capable of transporting 1,000 poundsThe SOO is often used in research and development or service contracts in which the desired outcome is stated in broad terms. The potential contractors provide a technical and management approach to meet the objective. SpecificationThe third type of requirement documents is the specification.<BR<
There are three types of specifications: * Design specifications * Functional specifications * Performance specificationsDesign Specifications

Design specifications identify requirements by stating exact dimensions, materials, composition, physical and chemical requirements, and other details of the product or service.Functional Specifications

Functional specifications state only the end result to be achieved. You provide a statement to describe a customer's specific need. For example, we need an environmental control method that will maintain a temperature of between 70 and 78 degrees in the main computer room year round.Performance Specifications

Performance specifications express requirements in the form of output, function, or operation of a commodity. When you write a performance specification you must describe your customer's requirements in terms of results. You also need to provide the criteria for verifying compliance, but you must not state methods for achieving results. You must define the functional requirements for the product, the environment in which it must operate, and the interface and interchangeability requirements.Specification (continued)Wilbur and Orville Wright's Flyer | Government Standard, Industry Standard | | | Companies prefer performance-based contracting because it creates results, reduces costs and maximizes outcomes. Performance based specifications benefit the contractor and the government.

By taking a performance-based approach you better manage contract performance. Performance based contracting is the preferred solution for results-focused contracting, today and tomorrow.Performance-Based Service ContractingTake a moment to review the seven steps to performance-based acquisitions on the Performance Based Acquisitions website.

This website outlines and defines the seven steps: * Establish the team. * Decide what problem needs solving. * Examine private-sector and public-sector solutions. * Develop a PWS or SOO. * Decide how to measure and manage performance. * Select the right contractor. * Manage performance. | | | | Performance Based Service Contracting - Step 4As you saw in your reading, Step 4 requires development of a PWS or SOO. Question 2 of 2You began your work as a contracting professional 20 years ago. Back then, contracts focused on how the work was to be performed. Now, the performance-based contracting strategies you use structure every aspect of an acquisition around the __________ of the work to be performed.

| | Purpose | | | Standards | | | Costs | | | Availability |
Performance-based contracting strategies have become the preferred contracting method and require structuring all aspects of an acquisition around the purpose of the work to be performed, as opposed to how the work is to be performed or broad and vague statements of work. Reviewing Requirements DocumentsThe following steps provide helpful guidance for you to use when reviewing requirements documents. You should recognize the steps might vary with the type and complexity of the requirement. | |
Step 1: Review Description and Initial Market ResearchDuring Step 1, you will review the description and the initial market research provided by the requiring activity. Step 1: (continued) Promoting Competition | You should be: * Trying to identify commercial/NDI items that can satisfy the stated requirement. * Reviewing requirements documents used in past contracts for same/similar requirements. * Reviewing any problems related to those documents, e.g., the document precluded the acquisition of commercially available items. * Obtaining feedback from suppliers on prior statements of work and/or requirements documents. For example, did they think the requirement included nonessential preferences; or was restrictive, obsolete, or vague? Step 1: (continued) Reviewing Initial Market Research Data | If initial market research indicates that commercial/NDI items will not satisfy the need as stated, you should ask the requirements manager to reevaluate the requirement and consider restating the need in terms that will allow for commercial/NDI items that would meet the need. (See FAR 10.002.) Step 2: Critique the Requirements DocumentsWhen critiquing the requirements documents, be sure to check the order of precedence established in FAR 11.101. Take a moment to review the order of precedence.11.101 -- Order of Precedence for Requirements Documents.(a) Agencies may select from existing requirements documents, modify or combine existing requirements documents, or create new requirements documents to meet agency needs, consistent with the following order of precedence:(1) Documents mandated for use by law.(2) Performance-oriented documents (e.g., a PWS or SOO). (See 2.101.)(3) Detailed design-oriented documents.(4) Standards, specifications and related publications issued by the Government outside the Defense or Federal series for the non-repetitive acquisition of items.(b) In accordance with OMB Circular A-119, “Federal Participation in the Development and Use of Voluntary Consensus Standards and in Conformity Assessment Activities,” and Section 12(d) of the National Technology Transfer and Advancement Act of 1995, Pub. L. 104-113 (15 U.S.C. 272 note), agencies must use voluntary consensus standards, when they exist, in lieu of Government-unique standards, except where inconsistent with law or otherwise impractical. The private sector manages and administers voluntary consensus standards. Such standards are not mandated by law (e.g., industry standards such as ISO 9000and IEEE 1680). | | | | Step 2: (continued) Order of Precedence in Requirements Documents | | The order of precedence is as follows: * First, use documents mandated by law * Second, use performance-oriented documents * Third, use detailed design-oriented documents * Fourth, use of standards, specifications and related publications issued by the government outside the defense or federal series for the non-repetitive acquisition of items | Step 2: (continued) Understand the Requirement | To better understand the requirement: * Find out what the required items look like. * Identify what the required items are made of. * Know how complex the process to manufacture the required items would be. * Review pictures, drawings, diagrams, or other graphic representations of the required items.Step 2: (continued) Promote Clarity in Requirements DocumentsPromote the use of clear, understandable language within the documents so that: * Only one interpretation is possible. * Each prospective contractor has no doubt as to what must be accomplished. Step 2: (continued) Use of Brand Names in Requirements DocumentsTake a moment to review FAR 11.104 and FAR 11.105. |
11.104 –User of Brand Name or Equal Purchase Descriptions.(a) While the use of performance specifications is preferred to encourage offerors to propose innovative solutions, the use of brand name or equal purchase descriptions may be advantageous under certain circumstances.(b) Brand name or equal purchase descriptions must include, in addition to the brand name, a general description of those salient physical, functional, or performance characteristics of the brand name item that an “equal” item must meet to be acceptable for award. Use brand name or equal descriptions when the salient characteristics are firm requirements.11.105 -- Items Peculiar to One Manufacturer.Agency requirements shall not be written so as to require a particular brand-name, product, or a feature of a product, peculiar to one manufacturer, thereby precluding consideration of a product manufactured by another company, unless --(a) (1) The particular brand name, product, or feature is essential to the Government’s requirements, and market research indicates other companies’ similar products, or products lacking the particular feature, do not meet, or can not be modified to meet, the agency’s needs;(2) (i) The authority to contract without providing for full and open competition is supported by the required justifications and approvals (see 6.302-1); or(ii) The basis for not providing for maximum practicable competition is documented in the file (see 13.106-1(b)) or justified (see 13.501) when the acquisition is awarded using simplified acquisition procedures.(3) The documentation or justification is posted for acquisitions over $25,000. (See 5.102(a)(6).)(b) For multiple award schedule orders, see 8.405-6.(c) For orders under indefinite-quantity contracts, see 16.505(a)(4).Step 2: (continued) Look for Limitations in Requirements Documents |
Requirements can restrict competition when they include any provision that: * Includes a design requirement that is unnecessary for performance * Includes geographic restrictions without a sound basis * Incorporates higher-end components that are above agency's minimum needs * Continues using features that are now obsolete * Is written around a particular product or service Step 2: (continued) Look for Inadequacies,
Contradictions, Inconsistencies in Requirements Documents | Common inadequacies and weaknesses: * Failure to use metric measurements where warranted * Requirements do not preclude inadequate products or services * Omission of essential requirements * Unclear contractor responsibilities * Ambiguous or vague terms * Nonessential or obsolete requirementsStep 2: (continued) Look for Inadequacies,
Contradictions, Inconsistencies in Requirements Documents * Other unreasonably restrictive requirements. * Specification of a particular brand name, product, or a feature of a product that is peculiar to one manufacturer, thereby unnecessarily precluding other products. * Failure to provide sufficient detail for a potential contractor to know which of its commercial products or services to offer. * Brand name or equal purchase description that does not include a general description of salient characteristics that an item must meet to be considered equal. * Use of fixed minimum performance requirements rather than performance targets, when market research data suggests that the Government is likely to benefit by providing the contractor the flexibility to propose price/performance tradeoffs. * Requirements that unreasonably restrict the use of commercial (or other non-developmental) components. * Requirements are too broad to manage effectively. * Requirements unreasonably restrict the use of environmentally preferable or energy efficient products or services. Step 2: (continued) Standardization Program in Requirements Documents | The guidance you follow depends on whether you work for a civilian or defense agency: * Guidance for civilian agencies is found in the Federal Standardization Manual. * Guidance for defense components is found in DOD 4120.24-M, Defense Program Policies and Procedures. Step 2: (continued) Where can You find Specifications? | Two websites list different types of specifications and standards: * Lists of nonmilitary specifications and standards are found in the General Services Administration Index of Federal Specifications, Standards, and Commercial Item Descriptions; on the GSA website * Lists of military specifications and standards are found in the Defense Index of Specifications and Standards (DoDISS) Question 1 of 2 | In your Step 1 review of past contracts for the same requirements, you discover that past requirements documents yielded some very different bids from prospective vendors. As you critique these documents in Step 2, you see that a lack of __________ contributed to the various interpretations.

| | Quotations | | | Ownership | | | Qualifications | | | Clarity | | | |
Since persons of varied backgrounds and professions often read and interpret requirements documents, you must promote clarity of language in those requirements documents. | | | | Question 2 of 2 | As you move forward in your review and recommended changes to the requirements documents, you are striving to improve market response by encouraging the use of commercial items and __________ items.

| | Interagency | | | Brand-name | | | Non-developmental | | | Sale | | | |
You should encourage the use of both commercial items and non-developmental items when you are recommending changes to improve the requirements documents.Step 3: Review Draft PWSAs you review and identify inadequacies in the draft PWS, look for potential problems such as: * Use of design specifications instead of performance specification * Incomplete requirements documents and sections omitted from the PWS * Specifications tailored to a particular brand or contractor based on a specific feature or process only available from that contractor * Inapplicable or obsolete sections * Ambiguous or vague terms that confuse the actual requirement, poor grammar, misspelling, and confusing paragraph and sentence structure * Failure to include FAR requirements, such as failure to use metric requirementsStep 3: What is in the Performance Work Statement (PWS)?The performance work statement (PWS) should provide a section called the scope, which offers a quick overview of what the PWS covers. This includes the background and objectives.

Second, the PWS should list the applicable documents. This list defines and explains the documents that describe the work to be performed.

Third, the PWS should identify the requirements. This would include tasks and end items required to be performed or delivered as a product or service of the contract.Step 4: Work with Your Customer to Prepare the Procurement RequestAs you review the elements of the procurement request, also review the packaging, preservation and marking requirements to determine if they are in line with standard commercial practices or that they are necessary for the procurement. Step 4: (continued) Unique Identifiers (UIDs) | In DoD, you need to include a DFARS clause 252.211-7003, Item Identification and Valuation in all contracts that require delivery of end items.

The unique identifier (UID) is required for all items delivered with an acquisition cost of $5000 or more and as may be designated by the requiring activity for items less than $5000. The UID can be a marking or embedded chip which can be used with equipment to identify the part number, manufacturer, contract and unit price. UID's are widely used by Wal-Mart and other businesses to track demand and inventory. Step 4: (continued) Inspection and Acceptance Criteria | Review inspection/acceptance criteria to ensure the quality requirements are commensurate with the technical description, its complexity, and criticality of application.

Review the delivery/performance schedules to ensure they are realisticStep 5: Obtain Industry FeedbackWhen you obtain industry feedback, seek information that would enhance the market's capability to meet the need that might generate additional industry interest in meeting the need, or anything that might enhance the industry's overall ability to meet the need with commercial items and/or non-developmental items. Step 5: (continued) Industry Panels | An industry panel is recommended for use when: * The need can be identified, but the most beneficial approach is unknown * Input from experts in industry would eliminate nonessential or obsolete requirements * Use of a panel would test the market's capabilities to perform the requirementStep 6: Review Changes with the Requirements ActivityYou must discuss possible changes and obtain agreement with requiring activity. It is your responsibility to communicate with the requiring activity about the adequacy of the requirements documents. Any needed changes should be explained. Proposed changes must be acceptable and continue to meet needs of the requiring activity.

The requiring activity must provide a written justification for any requirement that limits competition or restricts sources. The procurement cannot continue if it has unjustified restrictions, e.g., specifying a particular brand name, product, or feature. Question 1 of 2 | If you are writing an equipment contract that requires delivery of an end item with an acquisition cost over $5,000, the item will require a __________ to identify part number, manufacturer, contract, and unit price.

| | PWS | | | UID | | | SOW | | | RFQ | | | |
The UID can be a marking or embedded chip that can be used with equipment to identify the part number, manufacturer, contract, and unit price. | | Question 2 of 2 | Just as you are about to finish work on a contract that has been in process for over a month, the customer calls you with some last minute changes that will restrict sources and competition. You tell the customer that __________ __________ is required for the changes and that the procurement process will stop if the restrictions specify particular brands, products, or features.

| | Scope overview | | | Technical review | | | Standards compliance | | | Written justificationDocuments Required for Acquisitions for Services‚ Construction and Architect-Engineer ServicesAdditional Documents for Specific Acquisitions Service Contract Act of 1965The purpose of the Service Contract Act (SCA) is to require government contractors performing service contracts to compensate their service employees fairly and equitably.

Any proposed contract that will require services to be performed by the types of employees covered by the SCA, must comply with the provisions of the Act. Therefore, you must review new purchase requests and determine applicability of the SCA.Service Contract Act of 1965 (continued)Generally, the SCA will apply to a contract if the contract: * Exceeds $2,500 * Has as its principal purpose the furnishing of services * Is to be performed, to a significant or substantial extent, by service personnel other than executive, administrative, or professional employees * Will be performed in the United States * Is not otherwise exempt SCA Definitions | * Act or Service Contract Act: The Service Contract Act of 1965, as amended. * Service contract: Any Government contract, the principal purpose of which is to furnish services in the U.S. through the use of service employees, except as exempted. * Service employee:. Any person engaged in the performance of a service contract other than any person employed in a bona fide executive, administrative, or professional capacity. * United States: Includes any state of the United States, the District of Columbia, Puerto Rico, the Virgin Islands, Outer Continental Shelf Lands, American Samoa, Guam, Northern Mariana Islands, Wake Island, and Johnston Island, but does not include any other territory under U.S. jurisdiction or any U.S. base or possession within a foreign country SCA Definitions (continued) | * Wage and hour division: The unit in the Employment Standards Administration of the Department of Labor to which is assigned functions of the Secretary of Labor under the Act * Wage determination: A determination of minimum wages or fringe benefits made under sections 2(a) or 4(c) of the Act (41 U.S.C. 351(a) or 353(c)) applicable to the employment in a given locality of one or more classes of service employees * Collective Bargaining Agreement (CBA): An agreement between management and the employees who are represented by a union SCA Definitions (continued)Take a moment to review FAR 22.1003-5. Then take a look at FAR 22.1003-6. |
22.1003-5 -- Some Examples of Contracts Covered.The following examples, while not definitive or exclusive, illustrate some of the types of services that have been found to be covered by the Act (see 29 CFR 4.130 for additional examples):(a) Motor pool operation, parking, taxicab, and ambulance services.(b) Packing, crating, and storage.(c) Custodial, janitorial, housekeeping, and guard services.(d) Food service and lodging.(e) Laundry, dry-cleaning, linen-supply, and clothing alteration and repair services.(f) Snow, trash, and garbage removal.(g) Aerial spraying and aerial reconnaissance for fire detection.(h) Some support services at installations, including grounds maintenance and landscaping.(i) Certain specialized services requiring specific skills, such as drafting, illustrating, graphic arts, stenographic reporting, or mortuary services.(j) Electronic equipment maintenance and operation and engineering support services.(k) Maintenance and repair of all types of equipment, for example, aircraft, engines, electrical motors, vehicles, and electronic, office and related business and construction equipment. (But see 22.1003-4(c)(1) and (d)(1)(iv).)(l) Operation, maintenance, or logistics support of a Federal facility.(m) Data collection, processing and analysis services.22.1003-6 -- Repair Distinguished from Remanufacturing of Equipment.(a) Contracts principally for remanufacturing of equipment which is so extensive as to be equivalent to manufacturing are subject to the Walsh-Healey Public Contracts Act, rather than to the Service Contract Act. Remanufacturing shall be deemed to be manufacturing when the criteria in either subparagraphs (a)(1) or (a)(2) of this subsection are met.(1) Major overhaul of an item, piece of equipment, or material which is degraded or inoperable, and under which all of the following conditions exist:(i) The item or equipment is required to be completely or substantially torn down into individual component parts.(ii) Substantially all of the parts are reworked, rehabilitated, altered and/or replaced.(iii) The parts are reassembled so as to furnish a totally rebuilt item or piece of equipment.(iv) Manufacturing processes similar to those which were used in the manufacturing of the item or piece of equipment are utilized.(v) The disassembled components, if usable (except for situations where the number of items or pieces of equipment involved are too few to make it practicable) are commingled with existing inventory and, as such, lose their identification with respect to a particular piece of equipment.(vi) The items or equipment overhauled are restored to original life expectancy, or nearly so.(vii) Such work is performed in a facility owned or operated by the contractor.(2) Major modification of an item, piece of equipment, or material which is wholly or partially obsolete, and under which all of the following conditions exist:(i) The item or equipment is required to be completely or substantially torn down.(ii) Outmoded parts are replaced.(iii) The item or equipment is rebuilt or reassembled.(iv) The contract work results in the furnishing of a substantially modified item in a usable and serviceable condition.(v) The work is performed in a facility owned or operated by the contractor.(b) Remanufacturing does not include the repair of damaged or broken equipment which does not require a complete tear down, overhaul, and rebuild as described in subparagraphs (a)(1) and (a)(2) of this subsection, or the periodic and routine maintenance, preservation, care, adjustment, upkeep, or servicing of equipment to keep it in usable, serviceable, working order. Such contracts typically are billed on an hourly rate (labor plus materials and parts) basis. Any contract principally for this type of work is subject to the Service Contract Act. Examples of such work include the following:(1) Repair of an automobile, truck, or other vehicle, construction equipment, tractor, crane, aerospace, air conditioning and refrigeration equipment, electric motors, and ground powered industrial or vehicular equipment.(2) Repair of typewriters and other office equipment (but see 22.1003-4(c)(1) and (d)(1)(iv)).(3) Repair of appliances, radios, television sets, calculators, and other electronic equipment.(4) Inspecting, testing, calibration, painting, packaging, lubrication, tune-up, or replacement of internal parts of equipment listed in subparagraphs (b)(1), (b)(2), and (b)(3) of this subsection.(5) Reupholstering, reconditioning, repair, and refinishing of furniture.Determine the Impact the Collective Bargaining Agreement (CBA) has on the AcquisitionAfter establishing that the Service Contract Act applies, you must determine whether there is an existing contract and whether there is an applicable collective bargaining agreement (CBA).

If there is an existing contract, you must determine whether the incumbent prime contractor or its subcontractors and any of their employees have a collective bargaining agreement. | | | | | Determine the Impact the CBA has on the Acquisition (continued) | Obtain a copy of the existing CBA from the: * Administrative Contracting Officer (ACO) responsible for administering the previous contract * Previous SF 98/98a, Notice of Intention to Make a Service Contract * Existing contractor, as required per Section "(m)" of the SCA Clause (the contractor must provide the relevant information)You should be aware of statutory exemptions from this requirement. They can be found at FAR 22.1003-3.
In addition the Secretary of Labor has exempted several types of contracts, listing can be found at FAR 22.1003-4(b). | | Collective Bargaining Agreements | If wages to be paid or fringe benefits are to be furnished to any service employees employed by the government's prime contractor, or if any subcontractors under the contract are provided for in a collective bargaining agreement that is or will be effective during any period in which the contract is being performed, the government prime contractor must report the fact to the Contracting Officer.

The government prime contractor must also report full information as to the application and accrual of such wages and fringe benefits, including any prospective increases, to service employees engaged in work on the contract, and a copy of the collective bargaining agreement Collective Bargaining Agreements (continued) | If a proposed acquisition anticipates the award of a service contract subject to the SCA, the contract professional must determine whether the proposed contract will be an extension of a current contract or a follow-on to an existing contract.

You must then determine if a collective bargaining agent represents the employees of the incumbent prime contractor or subcontractors. If there is an agent, you must provide timely information to both that agent and the contractor regarding acquisition milestone dates for the proposed contract.Prepare for Wage Determination Requests (SF 98)You may also use the Department of Labor's (DOL's) e98 electronic process, located on the Wage Determinations Online (WDOL) website, to request a wage determination directly from the DOL. If the WDOL database does not contain the applicable prevailing wage determination for a contract action, you must use the e98 process to request a wage determination from the DOL. | Although the WDOL website provides assistance to the contracting agency to select the correct wage determination, the contracting agency remains responsible for the wage determination selected. If the contracting agency has used the e98 process, the DOL will respond to the contracting agency based on the information provided on the e98. The contracting agency may rely upon the DOL response as the correct wage determination for the contract.Prepare for Wage Determination Requests (SF 98) (continued) | | | | |
You must include a wage determination for the following types of service contracts: * New solicitations and contracts exceeding $2,500 or a contract modification that raises the contract amount above $2,500 and extends it or changes its scope to significantly affect its labor requirements. * A multiple year contract over $2,500 upon its anniversary date. Question 1 of 2If a contract falls under the provisions of the Service Contract Act of 1965, as amended, and the service employees are part of a union, what agreement must also be part of the contract?

| | Collective Bargaining Agreement | | | Wage Determination Agreement | | | Non-Professional Employee Agreement | | | Immigration Status AgreementAfter establishing that the Service Contract Act applies, you must determine whether there is an existing contract and where there is an applicable collective bargaining agreement (CBA). | | Question 2 of 2 | If it is necessary to obtain a wage determination from the Department of Labor (DOL) for your contract, you must allow sufficient __________ to accomplish the determination, especially if the determinations are not available on the DOL website.

| | Money | | | Negotiators | | | Time | | | ResourcesAn important point is that you must anticipate the amount of time required to gather the information necessary to obtain a wage determination, including sufficient time, if necessary, to contact the DOL to request wage determinations that are not available through the DOL website. | | | | | | |
Lt. Appleton is anxious to get to work right away on the next step for her new procurements, but, first, we need to know what James should do next. Which of the following is the next step for James?

| | Write the PR | | | Critique the requirements documents | | | Complete subcontracting agreements | | | Identify commercial and NDI items Since James already completed Step 1 by reviewing the descriptions and the initial market research, it is time for Step 2: Critiquing the requirements documents. Remember, there are five basic types of requirements documents James can review including CIDs, PWSs, Specifications, Government Standards, and Industry Standards. |
While reviewing and identifying any inadequacies in the draft PWS, James discovered that Lt. Appleton did her homework. The PWS did not demonstrate any potential problems.

James was also able to verify that the PWS provided the scope and listed all applicable documents.Next, James remembers that he should ensure Lt. Appleton has clearly outlined the 38th Security Detachment's requirements. To do so, what document should James ask to review next?

| | Commercial Item Descriptions | | | Wage Determination | | | Purchase Request | | | Specifications Document |
Reviewing the purchase request is Step 4. The PR will outline exactly what items and services are needed.Lt. Appleton explains she has prepared PRs for the services contract and the contracts for the construction of the security fence and guardhouse. James knows he must review each PR carefully to verify the PRs outline the 38th Security Detachment's requirements and meets FAR requirements. What elements should James look for in the PR? Select all that apply.

| | Description and fund citation | | | Required by date | | | Brand names | | | Delivery location and point of contact | | | Authorized signatures The PR should have the following essential elements: description, a fund citation or other statement of fund availability, required by date, delivery location, point of contact, authorized signatures and any other information that will be helpful to the contracting office in processing the PR. Remember, brand names are strongly discouraged. Because they limit competition, they should not be includedJames reviewed the PR for services, and explained to Lt. Appleton that the PR discussed the requirements in general terms, but there was not a clear description of what the contractors were to do and how the work could be measured. This is important to know because the FAR specifies different rules for personal services and non-personal services. James explained that personal services are defined by the regulations as services in which the contractor employees are to be used in place of government employees, and the employees do not have independent, specific, measurable work assignments. In addition, personal services contracts must have Congressional approval. Non-personal service contracts require the contractor to meet certain work requirements at specific times, and not be supervised by government personnel.

James and Lt. Appleton discussed these subtle specifications and identified the contracts as non-personal services contracts. Lt. Appleton listened intently as James explained that the service requirements must be described in terms of functions to be performed, performance required, or essential physical characteristics.

James also explained that FAR 39.104 Information Technology Services does not allow solicitations for IT services to describe any minimum experience or educational requirement for proposed contractor personnel, unless the: * Contracting Officer determined that the needs of the agency could not be met without those requirements * Work requires the use of something other than a performance-based acquisition Next, Lt. Appleton asked James which was the preferred method of contracting for services. What should his answer to Lt. Appleton be?

| | Sole source contracts | | | Commercial contracts | | | Sub-contracting agreements | | | Performance-based contracts | | | | | | | | |
Socioeconomic ProgramsYou should provide maximum practicable opportunities to business concerns classified in the following categories: * Small Business * Small Disadvantaged Business 8(a) Businesses * Historically Underutilized Business Zones (HUBZone) Small Business * Veteran-Owned Small Business (VOSB) * Service-Disabled Veteran-Owned Small Business (SDVOSB) * Women-Owned Small Business (WOSB)See FAR 19 for the new rules and exceptions.Statutory Government-Wide Contracting GoalsA person or business entering into a contract directly with the Government is referred to as a prime contractor. The current Federal prime contracting goals are: * 23% of prime contracts for small businesses * 5% of prime and subcontracts for small disadvantaged businesses * 5% of prime and subcontracts for women-owned small businesses * 3% of prime contracts for HUBZone small businesses for, and * 3% of prime and subcontracts for service-disabled Veteran-owned small businesses.Current Department of Defense (DoD) goals can be found on the Department of Defense Office of Small Business Programs website | | | |
Subcontracting Goals for Prime Contractors | |
Review FAR 19.201 to learn more about the government's policy to provide maximum practicable opportunities to various types of business.

Current DoD contracting goals for subcontractors are: * 31.7% of sub-contracts for small businesses * 5% of sub-contracts for small disadvantaged businesses * 5% of sub-contracts for women-owned small businesses * 3% of sub-contracts for service-disabled Veteran owned small businesses * 3% of sub-contracts for HUBZones | |
Small Business Administration (SBA)The SBA's primary responsibility is to teach small companies how to compete in the federal contracting arena, as well as how to take advantage of subcontracting opportunities available. For more information regarding the SBA, visit the Small Business Administration website.

In addition, the DoD procurement technical assistance centers (PTACs) also offer assistance to small businesses. For more information regarding these centers, visit the Department of Defense Procurement Technical Assistance Centers web site and the Association of Procurement Technical Assistance Centers website.Small Disadvantaged BusinessA small disadvantaged business (SDB) is a business concern that qualifies under the size standards described in FAR 19.102, and which is at least 51 percent unconditionally owned and controlled by one or more socially and economically disadvantaged individuals. An SDB is owned by one or more disadvantaged individuals whose net worth does not exceed $750,000.

Except for tribes, Alaska Native Corporations, Community Development Corporations and Native Hawaiian Organizations, each individual claiming disadvantaged status must be a citizen of the United States. The purpose of the program is to provide government contracting opportunities to socially and economically disadvantaged individuals. SDB's self certify as to their "disadvantaged" status | | | What Does Disadvantaged Mean?8(a) Business Development ProgramThe title "8(a)" comes from Section 8(a) of the Small Business Act of 1953. The 8(a) Business Development Program is a business assistance program for small disadvantaged businesses.

The 8(a) Program offers a broad scope of assistance by the SBA's district offices located throughout the country to firms that are owned and controlled at least 51% by socially and economically disadvantaged individuals8(a) Business Development Program – ParticipationParticipation by a small disadvantaged business in the 8(a) program is limited to nine years. The nine years is divided into two stages. The first stage, which lasts the first four of the nine-year period, is known as the developmental stage. The second stage, which lasts the remaining five years, of the nine-year period, is referred to as the transitional stage.

The developmental stage is designed to help 8(a) certified firms overcome their economic disadvantage by providing business development assistance. The transitional stage is designed to help participants overcome the remaining elements of economic disadvantage and to prepare participants for leaving the 8(a) program | | | 8(a) Business Development Program - Eligibility RequirementsThe basic requirements that an 8(a) applicant firm must meet to maintain eligibility include that firm being: * A small business as determined by the size standards * Unconditionally owned and controlled by one or more socially and economically disadvantaged individuals who are of good character and citizens of the United States * Able to demonstrate the potential for successA business can also qualify for the 8(a) program if the firm is owned by an Indian tribe, an Alaska Native Corporation (ANC), a Native-Hawaiian Organization (NHO), or a Community Development Corporation (CDC). The specific requirements with further explanations are in 13 CFR 124 8(a) Business Development8(a) Business Development Program - Participation RequirementsThe 8(a) Program requires participants: * Maintain a balance between their commercial and government business * Limit the total dollar value of sole source contracts that an individual participant can receive while in the program, which is $100 million or five times the value of its primary North American Industry Classification System (NAICS)The SBA district offices are responsible for monitoring and measuring the progress of participants through: * Annual reviews * Business planning * Systematic evaluations8(a) Business Development Program – AwardIn accordance with FAR 19.8, an acquisition offered to the SBA under the 8(a) Program shall be awarded on the basis of competition limited to eligible 8(a) firms if: * There is a reasonable expectation that at least two eligible and responsible 8(a) firms will submit offers and that award can be made at a fair market price * Anticipated total value of the contract, including options, will exceed $6.5 million for acquisitions assigned manufacturing NAICS codes and $4 million for all other acquisitions8(a) Business Development Program - Award (continued)A sole source award may be made to participants up to the $6.5 million ceiling, including options, for manufacturing NAICS codes and $4 million ceiling including option for all other acquisitions.

When an acquisition exceeds the competitive thresholds, the SBA may accept the requirement for a sole source 8(a) award if: * There is not a reasonable expectation that at least two eligible and responsible 8(a) firms will submit offers at a fair market price * The requirement is on behalf of a concern owned by an Indian tribe or an ANC8(a) Business Development Program - Award (continued)The SBA may not accept for negotiation a sole source (8a) contract that exceeds $20 million unless the requesting agency has completed a justification in accordance with FAR 6.303-2, the justification is approved by the appropriate official designated at FAR 6.304, and is made public after award in accordance with FAR 6.305.

8(a) firms are also able to form joint ventures and teams to bid on contracts. This enhances the ability of 8(a) firms to perform larger prime contracts and overcome the effects of contract bundling, the combining of two or more contracts together into one large contract.Historically Underutilized Business Zones (HUBZone) ProgramHistorically Underutilized Business Zones (HUBZone) Program – QualificationsTo be a qualified HUBZone small business concern a company must: * Be a small business as determined by the size standards * Be owned and controlled by at least 51% of United States (U.S.) citizens * Have the "principal office" located in a HUBZone * Have at least 35% of the company's employees residing in a HUBZone, but it doesn't have to be the same HUBZone as the company's principal office * Be certified by the U.S. Small Business AdministrationHistorically Underutilized Business Zones (HUBZone) Program - Award | | In accordance with FAR 19.13, a contracting officer may award contracts to HUBZone Small Business on the basis of competition if: * There is a reasonable expectation that at least two eligible and responsible HUBZone firms will submit offers, and that award can be made at a fair market price * Anticipated total value of the contract, including options, will exceed $6.5 million, including options, for acquisitions assigned manufacturing NAICS codes and $4 million, including options, for all other acquisitionsHistorically Underutilized Business Zones (HUBZone) Program - Award (continued) * Requirement is not currently being performed by an 8(a) participant under the provisions of subpart 19.8 or has been accepted as a requirement by the SBA under Subpart 19.8 | A sole source award may be made to participants up to the $6.5 million ceiling, including options, for manufacturing NAICS codes and $4 million ceiling including options for all other acquisitions. No sole source authority exists for contracts awarded under the Simplified Acquisition Threshold | | | |
Veteran-Owned Small Businesses | | | | | | | | | | | |
Service-Disabled Veteran-Owned Small BusinessThe Service-Disabled Veteran-Owned Small Business (SDVOSB) program is a program for small business concerns that are owned and controlled by service-disabled Veterans. An SDVOSB concern means a small business concern where: * Not less than 51 percent of the business is owned by one or more service-disabled Veterans or, in the case of any publicly owned business, not less than 51 percent of the stock in the business is owned by one or more service-disabled Veterans * The management and daily business operations of the business are controlled by one or more service-disabled Veterans or, in the case of a Veteran with permanent and severe disability, the spouse or permanent caregiver of such VeteranService-Disabled Veteran-Owned Small Business - AwardIn accordance with FAR 19.14, you may award contracts to an SDVOSB on the basis of competition if: * There is a reasonable expectation that at least two eligible and responsible SDVOSB firms will submit offers and that award can be made at a fair market price * Anticipated total value of the contract, including options, will exceed $6 million, including options, for acquisitions assigned manufacturing North American Industry Classification System (NAICS) codes and $3.5 million, including options, for all other acquisitions * Requirement is not currently being performed by an 8(a) participant under the provisions of subpart 19.8 or has been accepted as a requirement by SBA under subpart 19.8A sole source award may be made to participants up to the $6 million ceiling, including options, for manufacturing NAICS codes and $3.5 million ceiling including options for all other acquisitionsWomen-Owned Small Businesses | | Women-Owned Small Business Set-AsideIn order to do WOSB set-side, the solicitation must have an assigned NAICS code in which WOSB’s are substantiallyUnderrepresented, and the following must apply. * Rule of Two-The contracting officer has reasonable expectation that two or more WOSBs will submit an offer. * Award Price- The anticipated award price, including options, does not exceed the statutory thresholds of $6.5 * Million for manufacturing or $4M for other contracts. * The contract can be awarded at fair market price.Note: There are 38 4-digit NAICS designated for WOSBWomen-Owned Small Businesses - Eligibility RequirementsFor a business to be considered an women-owned small business, the following requirements must be met: * Small Business size standards for primary NAICS code and contracts must be met * At least 51% unconditionally and directly owned by women who are U.S.citizens * A woman must manage the day to day operations * A woman must take the long-term decisions for the business * A women must hold highest officer position * The women must work at the business full-time during normal business hours * There are no minimum requirements for the amount of time the business has been operational. Economically Disadvantaged Women-Owned Small Business - Set-AsidesIn order to do an EDWOSB set-aside, the solicitation must have an assigned NAICS code in which WOSBs are underrepresented, and the following must apply:

Rule of Two * Reasonable expectation that two or more EDWOSBs will submit an offerAward Price * Anticipated award price, including options, does not exceed the statutory thresholds of $6.5M for manufacturing or $4M for other contracts * Contract can be awarded at fair market price | There are 45 4-digit NAICS designated for a EDWOSB |
Economically Disadvantaged Women Owned Small Business - Eligibility RequirementsEligibility requirements for economically disadvantaged women-owned small businesses are the same as women-owned small businesses, plus: * Personal net worth (assets minus liabilities) is less than $750,000 excluding: * Ownership in business and primary personal residence * Income reinvested or used to pay taxes of business * Funds reinvested in IRA or other retirement account * Transferred assets within two years of, or on behalf of, an immediate family member for selection purposesEconomically Disadvantaged Women Owned Small Business - Eligibility Requirements (continued) * Adjusted gross income average over three years is $350,000 or less excluding income reinvested or used to pay the taxes of business * Fair market value of assets is $6 million or less excluding funds reinvested in IRA or other official retirement accountAWOSB/EDWOSB may submit an offer as a joint venture with another small business if the following Requirements are met: * Size: Combined annual receipts or employees joint venture must meet NAICS code assigned to contract, unless the exception in 13 C.F.R. 167;121.103(h)(3) applies * An EDWOSB/WOSB must be an managing venture * An EDWOSB/WOSB employee must be project manager responsible for performance of the contract * An EDWOSB/WOSB must receive at least 51% of net profits * The joint venture agreement must be in writing * The joint venture can meet subcontracting limitationsNote: A joint venture agreement does not have to be approved by SBA.Women-Owned Small Business - CertificationsSelf certification: * Free of charge * Business must register in CCR as WOSB or EDWOSB * Compiles and uploads all required documents to the repository * Represents status in ORCA
Third party certification: * Business must register in CCR as WOSB or EDWOSB * Allows the WOSB or EDWOSB to obtain certification from an SBA-approved third party certifier * Compiles and uploads all required documents to the repository * Represents status in ORCAThe Contracting Officer's Duties in Supporting WOSBsYou must make sure that all documents have been provided in the WOSB program repository prior to contract award. This allows you to ensure the award is made to an eligible WOSB or EDWOSB. The WOSB program repository is the SBA's General Log-In System (GLS).Subcontracting Program | |
Small Business Participation Plans are different than Subcontracting plans.

Subcontracting plans are not required from small business concerns; personal services contracts; contracts or contract modifications that will be performed entirely outside of the United States and its outlying areas; or modifications to contracts within the general scope of the contract.Which of the following best describe a "small business concern." Select all that apply.

| | Lobby organization for small businesses | | | Not dominant in its field of operation | | | Independently owned and operated | | | Discussion over low three-year profits |
A "small business concern" means a concern, and its affiliates, that is independently owned and operated, not dominant in the field of operation in which it bids on Government contracts, and qualifies as a small business according to regulations and standards.You are reviewing past acquisition histories about a certain 8(a) Program small disadvantaged business that you know has always performed well on any contract they have won. You notice a comment in one of the files that this business began their transitional stage six years ago. What is the most important thing this information tells you about moving forward with your process?

| | This business will receive specialized business training | | | This business will receive marketing assistance | | | This business will receive business development assistance | | | This business is no longer in the 8(a) Program, the transition stage is only five years | | |
Program participation is limited to nine years: four years for the developmental stage, five years for the transitional stage. After nine years, the business or individual owner is ineligible to participate in the 8(a) Program
Indian Incentive Program
The Indian Incentive Program provides for the payment to the prime contractor of five percent of the amount subcontracted to an Indian organization or Indian-owned economic enterprise at any sub-tier, when authorized under the terms of the contract.

Department of Defense contracts with prime contractors that contain the FAR clause FAR clause 52.226-1, Utilization of Indian Organizations and Indian-Owned Economic Enterprises, are eligible for incentive payments under the current program.
For actions after 13 September 2001, sub-tier contractors who subcontract to an Indian-owned firm are eligible for the incentive payments by the prime inserting DFARS Clause 252.226-7001 in the contract. These clauses may be added at any time during the performance of the contract by the prime.

Administrated by the Office of the Secretary of Defense (OSD) Office of Small Business Programs (OSBP), the Indian Incentive Program (IIP) makes every effort to provide added value to the Federal Government, in that this program is funded independently by the OSD and is not supported by the funds of the contracting agency. For more information, visit the Small Business Programs section of the FAR, under Part 19
Historically Black Colleges and Universities/Minority Institutions Program
DoD Mentor-Protege Program
The DoD Mentor-Protege Program was enacted in 1990 (Public Law 101-510) under the direction of former Senator Sam Nunn and Secretary of Defense William Perry. The purpose of the program is to provide incentives for DoD contractors to assist protege firms in enhancing their capabilities and to increase participation of such firms in government and commercial contracts.

The DoD Mentor-Protege Program assists small businesses (proteges) to successfully compete for prime contract and subcontract awards by partnering with large companies (mentors) under individual, project-based agreements. These partnerships have delivered a variety of products and services specialized in: environmental remediation, engineering services, information technology, manufacturing, telecommunications, health care, corrosion engineering, information assurance, robotics, circuit board, and metal component manufacturing. The DoD hopes that future agreements will focus on new technology areas such as radio frequency identification devices and enhanced security assurance.

Many mentor firms have made the program an integral part of their sourcing plans, while the protege firms have used their involvement in the program to develop much needed business and technical capabilities to diversify their customer base. Successful Mentor-Protege agreements provide a winning relationship for the protege, the mentor and the DoD.
DoD Small Business Innovation Research (SBIR) and Small Business Technology Transfer (SBTT) Programs
The purpose of DoD's SBIR and STTR Programs is to harness the innovative talents of our nation's small technology companies for U.S. military and economic strength.

The SBIR program provides up to $1,150,000 in early-stage R&D funding directly to small technology companies while the STTR program provides up to $850,000 in early-stage R&D funding directly to small companies working cooperatively with researchers at universities and other research institutions
Major benefits of these programs are that: * Small companies retain the intellectual property rights to technologies they develop under these programs * Funding is awarded competitively, but the process is streamlined and user-friendly
DoD Small Business Innovation Research Program
The Department of Defense SBIR program is made up of 12 participating components, including the Army, Navy, Air Force, Missile Defense Agency (MDA), Defense Advanced Research Projects Agency (DARPA), Chemical Biological Defense (CBD), Special Operations Command (SOCOM), Defense Threat Reduction Agency (DTRA), National Geospatial-Intelligence Agency (NGA), Defense Logistics Agency (DLA), Defense Microelectronics Activity (DMEA), and Defense Research & Engineering (DDR&E).

The SBIR program funds early-stage R&D at small technology companies and is designed to: * Stimulate technological innovation * Increase private sector commercialization of federal R&D * Increase small business participation in federally funded R&D * Foster participation by minority and disadvantaged firms in technological innovation

DoD Small Business Technology Transfer Program
The six components of the STTR program include the Army, Navy, Air Force, Missile Defense Agency (MDA), Defense Advanced Research Projects Agency (DARPA), and Defense Research & Engineering (DDR&E).

The STTR program was piloted by Congress in 1992, and is similar in structure to SBIR, except that the STTR funds cooperative R&D projects involving a small business and a research institution (e.g., university, federally-funded R&D center, or nonprofit research institution).

The purpose of STTR is to create, for the first time, an effective vehicle for moving ideas from our nation's research institutions to the market, where they can benefit both private sector and military customers

SBIR and SBTT - Three Phased Program | |
AbilityOne Program
The AbilityOne program (formerly referred to as JWOD) is a socioeconomic program whose purpose is to create jobs and training opportunities for people who are blind or who have other severe disabilities.

Originally established by the Wagner-O'Day Act in 1938 under President Franklin D. Roosevelt, the program was developed to provide employment opportunities for people who are blind by allowing them to manufacture mops and brooms to sell to the Federal Government.

In 1971, under the leadership of Senator Jacob Javits, Congress amended this Act (41 U.S.C. 46-48c) to include people with severe disabilities and allow the program to also provide services to the Federal Government. The Committee for the Purchase From People Who Are Blind or Severely Disabled, an independent federal agency, administers the AbilityOne program.
How the AbilityOne Program Works
The AbilityOne program requires the Government to purchase supplies or services on the procurement list, at prices established by the committee, from participating nonprofit agencies if they are available within the period required.

The National Industries for the Severely Handicapped (NISH) and the National Industries for the Blind (NIB) are two central nonprofit agencies participating in the AbilityOne program.

The Committee for Purchase From People Who Are Blind or Severely Disabled maintains a procurement list of products and services which have been placed in the AbilityOne program. Additional information can be found on the AbilityOne web site.

In which socioeconomic program would you find a large non-research corporation?

| | Indian Incentive program | | | HBCU/MI program | | | DoD Mentor-Protege program | | | DoD SBIR or STTR Program |
The DoD Mentor-Protege program assists small businesses (proteges) successfully compete for contract awards by partnering with large companies (mentors) under individual, project-based agreements

Your hometown has a small "factory" that employs citizens with a wide range of disabilities. Your cousin is the shop foreman. You recommend that the purchasing department contacts the Federal Government to investigate participation in which program?

| | AbilityOne program | | | SBIR program | | | STTR program | | | Three Phased program |
The AbilityOne program is a socioeconomic program whose purpose is to create jobs and training opportunities for people who are blind or who have other severe disabilities.

Procedures for Setting Aside an Acquisition under the Small Business Act

Non-Manufacturer Rule

A concern may qualify for a requirement to provide manufactured products as a non-manufacturer if it: * Does not exceed 500 employees * Is primarily engaged in the wholesale or retail trade and normally sells the items being supplied to the general public * Will supply the end item of a small business manufacturer or processor made in the United States, or obtains a waiver of such requirement
Select Non-manufacturer Rule to see an example of how the rule is applied.

For Non-manufacturing Rule waivers, select SBA guidance.

Rule of Two

You are required to set aside an acquisition for small business participation when there is a reasonable expectation that offers will be obtained from at least two responsible small business concerns that are competitive in terms of market prices, quality, and delivery
Automatic Set Asides Below the Simplified Acquisition Threshold
Less than $3,000: For acquisitions below $3,000 there is no requirement for you to set-aside the purchase. In other words, you can award on an unrestricted basis provided the price is fair and reasonable. The AbilityOne program is, however, still applicable to these acquisitions.

Greater than $3,000, but less than $150,000: All federal purchases greater than $3,000 but less than $150,000 are set aside exclusively for small business competition unless you determine that 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

However, before deciding to set aside an acquisition for small business, you may review the acquisition for an 8(a), Historically Underutilized Business Zones (HUBZone), Service-Disabled Veteran-Owned Small Business (SDVOSB), or Woman-Owned Small Business (WOSB) set aside prior to a small business set aside. For these socioeconomic categories [8(a), HUBZone, SDVOSB, or WOSB] no one program takes precedence over the other. However, if the requirement is a follow-on and is already in the 8(a) program, you must get approval from the 8(a) before choosing a different type of socioeconomic set aside. Except as authorized by law, a contract may not be awarded as the result of a small business set-aside if the cost to the awarding agency exceeds the fair market price. For additional information, see FAR 19.501(g).

Which of the following is NOT a qualification for a non-manufacturer concern?

| | Supplies U.S. made end item of a small business manufacturer or processor | | | U.S. ownership of a distributorship, with end item computer assembly in Mexico | | | Primarily engages in wholesale/retail sales to the general public | | | Does not exceed 500 employees |

In spite of U.S. ownership, if the end item is not manufactured or does not achieve its final assembly in the U.S., the concern cannot qualify under the non-manufacturer rule

You are considering your next steps to award an acquisition below $3,000. Select the statement(s) below that are true about this award. Select all that apply.

| | There is no requirement for you to set aside this purchase | | | Unfortunately, you cannot consider the AbilityOne program for this acquisition | | | You must obtain the chief contracting officer's signature on the award | | | You can award on an unrestricted basis provided the price is fair and reasonable |
For acquisitions below $3,000, there is no requirement for you to set-aside the purchase. Therefore, you can award on an unrestricted basis provided the price is fair and reasonable.

Automatic Set Asides above the Simplified Acquisition Threshold

Partial Set-Asides
You are required to set aside a portion of an acquisition, and restrict that portion for small business concerns under the following conditions: * The requirement is severable into economic lots. That is, the acquisition can be divided into different contracts. * One or more small businesses are expected to have the technical and productive competency to satisfy the set-aside portion at a fair market price. * The partial set-asides do not apply to acquisitions utilizing simplified acquisition procedures.
For more information on set-asides for small business, review the continuous learning model FAC009 that DAU offers, as well as FAR 19.502

Certificate of Competency
When you determine that a small business is not responsible, you shall refer the acquisition to your designated small business administration (SBA) representative for potential issuance of a Certificate of Competency (COC).

The Certificate of Competency program allows a small business to appeal your determination that it is unable to fulfill the requirements of a specific government contract on which it is the apparent winner.

When the small business applies for a Certificate of Competency, SBA industrial and financial specialists conduct a detailed review of the firm's capabilities to perform on the contract. If the business demonstrates the ability to perform, the SBA issues a Certificate of Competency to you, requiring your office, to award that specific contract to the small business

A large acquisition come across your desk. After having performed all research, it is apparent that you could easily divide the contract into three smaller sections of work. You are now considering how to include small business in the award. You decide that __________ is most appropriate.

| | An automatic set-aside | | | A Certificate of Competency | | | A partial set-aside | | | A price markup |

You are required to set aside a portion of an acquisition and restrict that portion for small business concerns when the requirement is severable into economic lots. In other words, the acquisition can be divided into different contracts

You hope to use a particular small business on an upcoming project, but there have been some setbacks and the business applies for a Certificate of Competency (COC). How would the business obtain the COC?

| | The SBA conducts a review of the business's capabilities to perform on this specific contract, and if deemed capable and responsible, a COC is then issued to you for the project

| | | The SBA administers quarterly competency exams to its members; a business passes the next round of exams and receives a COC

| | | The records indicate this business has performed in a capable manner on three or more contracts in the previous three years, the business automatically receives a COC

If the business demonstrates to the SBA the ability to perform on the contract, the SBA issues a COC to you requiring your office to award that specific contract to the small business.


The Buy American Act requires that only domestic end products be acquired for public use, except articles, materials, and supplies that: * Are for use outside of the United States * The cost are unreasonable as determined in accordance with FAR and / or agency guidance * The Agency Head determines that domestic preferences is inconsistent with public interest * Are not mined, produced, or manufactured in the U.S. in sufficient and reasonably available commercial quantities, of a satisfactory quality. * Purchased specifically for commissary resale * The joint venture can meet subcontracting limitations
Note: A joint venture agreement does not have to be approved by SBA.

The Berry Amendment

Regarding purchases of textile and apparel items, the Berry Amendment requires that funds made available to DoD may not be used to purchase clothing; tents, tarpaulins, or covers; cotton and other natural fiber products, woven silk or woven silk blends, spun silk yarn for cartridge cloth, synthetic fabric or coated synthetic fabric (including all textile fibers and yarns that are for use in such fabrics), canvas products, or wool (whether in the form of fiber or yarn or contained in fabrics, materials, or manufactured articles); or items of individual equipment manufactured from or containing such fibers, yarns, fabrics, or materials unless it is grown, reprocessed, reused, or produced in the United States.

That is, covered end items, components, and materials purchased with funds made available to DoD must be produced wholly in the United States

Exceptions to the Berry Amendment

Waivers to Berry Amendment restrictions on foreign purchases are permitted if the Secretary concerned determines that items grown, reprocessed, reused, or produced in the United States cannot be acquired as and when needed in a satisfactory quality and sufficient quantity at U.S. market prices. A restriction on steel may include a rare type of this metal, not produced in the United States, but necessary to be included in the end component.

However, waivers are uncommon. Waiver decisions may be made by the Under Secretary of Defense (Acquisition, Technology and Logistics), the Secretary of the Army, the Secretary of the Navy, or the Secretary of the Air Force without re-delegation.

World Trade Organization (WTO)
Government Procurement Agreement (GPA) and Free Trade Agreements

The Trade Agreements Act (19 U.S.C. 2501, et seq.) provides the authority for the President to waive the Buy American Act and other discriminatory provisions for eligible products from countries that have signed an international trade agreement with the United States, or that meet certain other criteria, such as being a least developed country.

The President has delegated this waiver authority to the U.S. Trade Representative. In acquisitions covered by the WTO GPA, Free Trade Agreements, or the Israeli Trade Act, the USTR has waived the Buy American Act and other discriminatory provisions for eligible products. Offers of eligible products receive equal consideration with domestic offers.

Prohibited Sources

You are prohibited from buying supplies or services originating from, or that were located in, or transported from or through the following locations: * Cuba * Iran * North Korea * Sudan
You should be aware of the following exception, which states that unless an agency requires a higher level of approval, you, the contracting officer, may, in unusual circumstances, acquire for use outside the United States supplies and services from the above list. Examples of an unusual circumstance include emergencies, or the non-availability of needed supplies and services

Select the three exceptions to the Buy American Act from below.

| | Duhat berries and mangosteens from a supplier in Manila for resale the Naval Base San Diego commissary | | | Reduced price items from a small business supplier within 100 miles of your office in Norfolk | | | Rare earth metals obtained from an Asian supplier for essential military communication parts manufactured in U.S. facilities | | | Cleaning supplies for European military bases purchased from a supplier in southern India |
Exceptions to the Buy American Act include items for use outside the U.S., items that are not mined, produced, or manufactured in the U.S. in sufficient and reasonably available commercial quantities of a satisfactory quality, or items purchased specifically for commissary resale.

Under certain circumstances where an international trade agreement is in effect or a country is very minimally developed, what legislation gives the President, or the designated trade representative, authority to waive the Buy American Act?

| | WTO GPA | | | The Trade Agreements Act | | | The Berry Amendment | | | Free Trade Agreements |
The Trade Agreements Act provides the authority for the President, or the delegated U.S. trade representative, to waive the Buy American Act for eligible products from countries that have signed an international trade agreement with the U.S., or that meet certain other criteria, such as being a least-developed country

James Newman, contracting officer (CO), must select potential sources for his various procurements. James: * Is familiar with the FAR requirements in Part 19, Small Business Programs * Has already considered awarding the office supply requirement to AbilityOne * Is aware that all solicitations involving set-asides may specify the applicable small business * Has checked the size standard for IT Service firms and found that it was $25 million (over the SAT) with the possibility it could be set aside for small business * Has met with a Small Business Specialist (SBS) and found out the installation of the IT equipment had met its goals for awards to HUBZone and Veteran-Owned Small Businesses, but none of the other goals had been met
Through discussions with the SBS, James found out that three small business firms had the capability to perform the service contract work, as well as one 8(a) firm, and one SDVOSB. Each of the firms were owned or managed by former military or government civilian IT professionals, and all the firms had top-secret clearances. The SBS also confirmed that she had talked to each of the firms and they all were interested. Which type of small business set-aside is this an example of?

| | Non-manufacturer Rule | | | Rule of Two | | | Automatic Set-Asides Below the Simplified Acquisition Threshold | | | Automatic Set-Asides Above the Simplified Acquisition Threshold |

Because the SBS had confirmed that she had talked to each of the firms and they were all interested, covering the Rule of Two, what action should James take?

| | James should set aside the acquisition because the total dollar value of the contract is above the Simplified Acquisition Threshold.

| | | James should set aside the acquisition because the total dollar value of the contract is below the Simplified Acquisition Threshold.

| | | James should not set aside any portion of the acquisition.

| | | James should set aside the acquisition for small business participation because there is a reasonable expectation that offers will be obtained from at least two responsible small business concerns |

James should set aside the acquisition for small business participation because there is a reasonable expectation that offers will be obtained from at least two responsible small business concerns

Use of Various Types of Contracts
Simplified Acquisition Methods are used to procure goods or services. They range from the simple Government Commercial Purchase Card to complex contracts and agreements. Other acquisition methods that will be discussed in this lesson include: * Purchase Orders * Blanket Purchase Agreements * Imprest Funds * Sealed Bidding * Fixed-Price Contracts * Cost Reimbursement Contracts * Time and Materials Contracts * Basic Agreements
Cash, Check, or Charge

Simplified Acquisition Methods
FAR Subpart 13.3, Simplified Acquisition Methods

As you read, pay particular attention to: * Distinctions between the different methods (for example the advantages, disadvantages and limitations of each) * First paragraph of each acquisition method * Paragraphs titled "General" - they give you a concise description of the different methods
Use this link to read FAR 13.301-13.307 now.

FAR Subpart 13.2, Actions at or Below the Micro-Purchase Threshold

Please take a few minutes to read this coverage and return to the lesson.
FAR Subpart 13.2

Government Commercial Purchase Card
The Government Commercial Purchase Card (GCPC) is the preferred acquisition method for simplified acquisitions, when appropriate. * Simply and widely accepted, with less administration * Used to make purchases under the micro-purchase limit * Used to place orders under other contracts and agreements
Purchase Orders
A purchase order is a written contract action at or below the simplified acquisition threshold. The purchase order is the simplest form of a written contract
Purchase Orders: * Can be used for most purchases within the Simplified Acquisition Threshold (SAT) * Have all terms and conditions in writing * Include the clauses required for purchase orders * Must be signed by a contracting officer, and sometimes it is also signed by the contractor
Unpriced Purchase Orders

Which of the following acquisition methods is used to make purchases under the micro-purchase limit for non-contracting personnel?

| | Unpriced purchase order | | | Purchase order | | | Government commercial purchase card | | | Government commercial purchase contract |
Government commercial purchase cards are used to make purchases under the micro-purchase limit for non-contracting personnel

Which of the following is the simplest form of a written contract action at or below the Simplified Acquisition Threshold?

| | Government commercial purchase card | | | Government commercial purchase contract | | | Purchase order | | | Unpriced purchase order |
Purchase orders are a simple written contract action at or below the Simplified Acquisition Threshold.

Blanket Purchase Agreements
A blanket purchase agreement (BPA) is not a contract, but an agreement between the Government and a vendor that sets forth terms and conditions that will apply to individual orders. The blanket purchase agreement is similar to an account your family might have with a store. You make purchases at the store by putting things on your account. At the end of the month, the store sends a bill for everything purchased that month.

BPAs may be used with GSA Schedule contracts to place orders; even those exceeding the SAT.

The BPA will identify who is permitted to place orders. It may be the contracting officer, or if desired, the contracting officer may appoint ordering officers inside or outside of the contracting office. When you appoint ordering officers, you provide them with letters of designation outlining the limitations of their authority.

Individual Orders

These orders are often referred to as calls. Each individual order is a contract

Imprest Funds and Third Party Drafts

Imprest funds are cash accounts. They are similar to petty cash accounts maintained by businesses. One use of imprest funds is to make small purchases without having to issue a purchase order.

Some offices use third party drafts. Local policies within DOD on the use of the third party draft vary widely. This method is not common, however, you should know that Defense Finance and Accounting Service (DFAS) prefers that third party drafts or convenience checks are used for various acquisitions where the "vendors" do not accept the GCPC (e.g., choir directors and organists) and the providers do not have a monthly billing process.

Third Party Drafts

This is a check drawn against the purchase card account to make small purchases or payments when the vendors will not accept the purchase card.

Purchase Order-Invoice-Voucher

What simplified acquisition method can be used to make small purchases when a vendor will not accept the Government Commercial Purchase Card and do not have a monthly billing process?

| | Blanket purchase agreement | | | Imprest funds | | | Third party drafts | | | Purchase order-invoice-voucher |
Third party drafts can be used to make small purchases when a vendor will not accept the Government Commercial Purchase Card and does not have a monthly billing process

Which of the following documents is used not only as a purchase order, but as an invoice for payment?

| | Blanket purchase agreement | | | Unpriced purchase order | | | Third party draft | | | Purchase order-invoice-voucher |

A purchase order-invoice-voucher is a purchase order used to annotate payment. They can be used in situations where vendors may not have the capability to process a bank credit card.

Acquisition Methods Other than Simplified Acquisition

Sealed Bidding
"What about sealed bids? In sealed bidding, there is not so much noise and excitement. Everyone has an opportunity to write down a bid and turn it in. You only have one chance to make a bid. At a designated time the bids are publicly opened and the low bidder is determined."

Steps to Sealed Bidding" * Invitation for bids (IFB) * Vendors submit bids * Solicitation is closed * Bid opening
"The steps are similar to sealed bid auctions. The Government sends out an invitation for bids or IFB, called a solicitation. You will learn much more about solicitations in later lessons. Next, vendors are offered an opportunity to submit their bids. These are called sealed bids because the Government will not open them until the designated time. At a time that is designated in the IFB, the solicitation is closed, which means no more bids will be accepted. After that there is a bid opening that is open to the public. Everyone gets to hear what everyone else bid. (Narrator) This is a formal process. Only firm-fixed price or firm-fixed price contracts with economics price adjustments can be awarded using Sealed Bid procedures. Cost-type contracts cannot be awarded using Sealed Bid.

Read FAR Subpart 14.1 to learn about the use of sealed bidding

Subpart 14.1 -- Use of Sealed Bidding
14.101 -- Elements of Sealed Bidding.
Sealed bidding is a method of contracting that employs competitive bids, public opening of bids, and awards. The following steps are involved:
(a) Preparation of invitations for bids. Invitations must describe the requirements of the Government clearly, accurately, and completely. Unnecessarily restrictive specifications or requirements that might unduly limit the number of bidders are prohibited. The invitation includes all documents (whether attached or incorporated by reference) furnished prospective bidders for the purpose of bidding.
(b) Publicizing the invitation for bids. Invitations must be publicized through distribution to prospective bidders, posting in public places, and such other means as may be appropriate. Publicizing must occur a sufficient time before public opening of bids to enable prospective bidders to prepare and submit bids.
(c) Submission of bids. Bidders must submit sealed bids to be opened at the time and place stated in the solicitation for the public opening of bids.
(d) Evaluation of bids. Bids shall be evaluated without discussions.
(e) Contract award. After bids are publicly opened, an award will be made with reasonable promptness to that responsible bidder whose bid, conforming to the invitation for bids, will be most advantageous to the Government, considering only price and the price-related factors included in the invitation.

Use of Sealed Bidding – Responsiveness
Responsiveness at FAR 14.301
Subpart 14.3 -- Submission of Bids
14.301 -- Responsiveness of Bids.
(a) To be considered for award, a bid must comply in all material respects with the invitation for bids. Such compliance enables bidders to stand on an equal footing and maintain the integrity of the sealed bidding system.
(b) Telegraphic bids shall not be considered unless permitted by the invitation. The term “telegraphic bids” means bids submitted by telegram or by mailgram.
(c) Facsimile bids shall not be considered unless permitted by the solicitation (see 14.202-7).
(d) Bids should be filled out, executed, and submitted in accordance with the instructions in the invitation. If a bidder uses its own bid form or a letter to submit a bid, the bid may be considered only if --
(1) The bidder accepts all the terms and conditions of the invitation; and
(2) Award on the bid would result in a binding contract with terms and conditions that do not vary from the terms and conditions of the invitation.
(e) Bids submitted by electronic commerce shall be considered only if the electronic commerce method was specifically stipulated or permitted by the solicitation.
* Quantity * Quality * Delivery * Price
Use of Sealed Bidding – Responsibility
The FAR talks about responsibility at FAR Subpart 9.1
Responsibility describes a vendor's ability to perform as specified in the contract.
* Technical ability * Financing integrity * Business integrity
Handling Bids
By looking at the table of contents for Part 14, you will find that there are specific guidelines covering all aspects of developing and handling IFBs. For the purpose of this lesson, we are going to skip over that for now.

Learning the details of processing a sealed bid is beyond the purpose of this lesson, but, before you process one of these for your office, you will want to read the whole of FAR Part 14. There is one issue we need to examine, however, which is how to address mistakes.
Addressing Mistakes
"You open the bids and the low bid is EXTREMELY low. Everyone is surprised at the apparent winner's low bid."
"No one is more surprised than the low bidder. He screams. Then he explains he meant to bid $200 per each item, not $200 for the whole lot. What are we to do?"
Read FAR 14.407 to learn about handling mistakes, then return to continue the lesson.

Your reading has shown you that there are different kinds of mistakes. There can be apparent clerical errors, other mistakes, and even mistakes after award.

These are handled in various ways: * Allowing a correction of the mistake * Allowing the bidder to withdraw the bid * Enforcing performance at the bid price | What about our poor bidder in the previous example? The case has not given us enough information; we would need to investigate further to see what the appropriate action would be. It is important to know, however, that the DFARS identifies who may make the final determination regarding certain mistakes | Read DFARS 214.407-3 to discover who makes these determinations for your office. You will also have to read your local supplement(s) to find out who actually makes such determinations in your office.Evaluation of BidsThe low bidder is determined by the bottom line price. The bottom line price is normally just the aggregate total of all line items bid. There are some exceptions to this including: * Split awards * Options * Economic price adjustment * Prompt payment discounts These issues are beyond the level of this lesson. If you need specific information in any of these areas and cannot find it, contact your instructor via email. |
What are the two basic methods for acquisitions above the Simplified Acquisition Threshold?

| | Silent bidding & contract by consensus | | | Sealed bidding & contract by negotiations | | | Sealed bidding & contract by consensus | | | Silent bidding & contract by negotiations | |

The first method is called sealed bidding, described in FAR Part 14, and the second method is contracting by negotiations, described in FAR Part 15.

What are the words that are very important in sealed bidding? Select all that apply.

| | Responsiveness | | | Receptiveness | | | Reactivity | | | Responsibility |
Responsiveness and responsibility are both important words associated with sealed bidding. A responsive bidder provides exactly what the Government asked for in the invitation for bids (IFB). A responsible bidder performs as specified in the contract

Two-Step Sealed Bidding

Read about Two-step Sealed Bidding by reading FAR Subpart 14.5.

The use of Two-Step Sealed Bidding is not common, but it is very effective when it can be used. A technical proposal is requested. Step one allows bidders the flexibility to be very innovative in their approach to meet the Government's need. Once the Government evaluates the technical proposals and determines which ones are satisfactory, step two provides for an objective, price-driven competition. The award is made to the low bidder, if responsive and responsible.
Contracting By Negotiation

The sealed bid method of procurement and most of the methods we looked at for acquisitions that are less than the SAT are primarily based on the lowest price, although acquisitions below the SAT may be awarded on factors other than price, which is becoming more common. The Government is often criticized for not getting the best value because it is incorrectly assumed that the Government always awards to the lowest bidder. When you shop for yourself do you do always buy the product with the lowest price? Like most people, you probably consider many factors other than price when making your shopping decisions. Often, your purchase decisions are more subjective than objective. We also need that flexibility to get the best value for the taxpayers when we write Government contracts. Sometimes the sealed bidding method does not give us that flexibility, so we use negotiated acquisitions. This is another acquisition method, besides SAT and Sealed Bid.

Best Value
Read FAR Subpart 15.1 to see what this means
15.101 -- Best Value Continuum.
An agency can obtain best value in negotiated acquisitions by using any one or a combination of source selection approaches. In different types of acquisitions, the relative importance of cost or price may vary. For example, in acquisitions where the requirement is clearly definable and the risk of unsuccessful contract performance is minimal, cost or price may play a dominant role in source selection. The less definitive the requirement, the more development work required, or the greater the performance risk, the more technical or past performance considerations may play a dominant role in source selection.
15.101-1 -- Tradeoff Process.
(a) A tradeoff process is appropriate when it may be in the best interest of the Government to consider award to other than the lowest priced offeror or other than the highest technically rated offeror.
(b) When using a tradeoff process, the following apply:
(1) All evaluation factors and significant subfactors that will affect contract award and their relative importance shall be clearly stated in the solicitation; and
(2) The solicitation shall state whether all evaluation factors other than cost or price, when combined, are significantly more important than, approximately equal to, or significantly less important than cost or price.
(c) This process permits tradeoffs among cost or price and non-cost factors and allows the Government to accept other than the lowest priced proposal. The perceived benefits of the higher priced proposal shall merit the additional cost, and the rationale for tradeoffs must be documented in the file in accordance with 15.406.
15.101-2 -- Lowest Price Technically Acceptable Source Selection Process.
(a) The lowest price technically acceptable source selection process is appropriate when best value is expected to result from selection of the technically acceptable proposal with the lowest evaluated price.
(b) When using the lowest price technically acceptable process, the following apply:
(1) The evaluation factors and significant subfactors that establish the requirements of acceptability shall be set forth in the solicitation. Solicitations shall specify that award will be made on the basis of the lowest evaluated price of proposals meeting or exceeding the acceptability standards for non-cost factors. If the contracting officer documents the file pursuant to 15.304(c)(3)(iii), past performance need not be an evaluation factor in lowest price technically acceptable source selections. If the contracting officer elects to consider past performance as an evaluation factor, it shall be evaluated in accordance with 15.305. However, the comparative assessment in 15.305(a)(2)(i) does not apply. If the contracting officer determines that a small business’ past performance is not acceptable, the matter shall be referred to the Small Business Administration for a Certificate of Competency determination, in accordance with the procedures contained in subpart 19.6 and 15 U.S.C. 637(b)(7)).
(2) Tradeoffs are not permitted.
(3) Proposals are evaluated for acceptability but not ranked using the non-cost/price factors.
(4) Exchanges may occur (see 15.306).

The "Tradeoff Process" Written in the Tradeoff Process Box is "The government looks at technical, expedited delivery and other factors." The narrator says the following: "In a tradeoff process the government looks at technical, expedited delivery and/or other factors. Then it is determined whether those factors have value that would be worth paying extra for. Acquisition professionals trade off price to get the increased value in these other areas. This can be done through objective evaluation or subjective evaluation.

-The "Lowest Price Technically Acceptable" Written in the Lowest Price Technically Acceptable box is "Every proposal is evaluated and determined technically acceptable or not acceptable." The narrator says the following: "The second method of determining best value is Lowest Price Technically Acceptable. This method is somewhat simpler in that it does not permit tradeoffs. Every proposal is evaluated and determined either technically acceptable or not acceptable. The award will go to whoever has a technically acceptable proposal and offers the lowest price.

Everyone is told ahead of time which method for evaluation will be used. The difference between Lowest Price Technically Acceptable and Two-Step Sealed Bidding revolves around the allowability of exchanges, including discussions of prices. Be fair to all potential vendors

* Do not make arbitrary decisions * You must be rational * Tell all offerors what factors you evaluate * Always consider the price or cost.
How to achieve the Best Value

1. Be fair to all potential vendors 2. Do not make arbitrary decisions 3. You must be rational 4. Tell all offerors what factors you evaluate 5. Always consider your cost or price

"Determining best value is a difficult process. Because you are entrusted to spend tax dollars, you must be fair to all potential vendors. You cannot make arbitrary decisions that affect spending Government funds. Your determinations must be rational. If you are going to evaluate factors that are not price related, you must tell all offerors what those factors are, how important they are and how they will be evaluated. Finally, no matter how important the other factors are, you must always consider the price or cost to the Government as a significant factor in your evaluation."
Process for Negotiated Acquisitions
In sealed bidding, we opened the bids publicly and read them out for all to hear. Proposals, on the other hand, are opened privately and the contents are often not released outside the Government without the offeror's explicit permission. We examined bids for responsiveness. In negotiated procurements, responsiveness is not a criterion by which to disqualify a proposal. Everything is negotiable. In sealed bidding, once we opened the bids, the next step was to award. In a negotiated procurement we often talk with offerors. We have information exchanges, clarifications and discussions. Then the offerors are often requested to revise their offers. Evaluating a proposal is different from a bid. We look at technical and other factors. We can use a tradeoff process to pick the proposal offering the best value to the Government. The reading material contained information on other areas that we must consider in negotiated procurements: * Cost and pricing data * Negotiations and documentation required * Provisions in solicitations and clauses in contracts * Notifying unsuccessful offerors * Debriefing * Unsolicited proposals

Which of the following occurs in the second step of the Two-Step Sealed Bidding process?

| | Innovative technical proposals are submitted | | | Technical proposals including pricing of supplies or services are requested | | | Sealed priced bids are submitted by those who submitted acceptable technical proposals | | | Questions relating to technical requirements are clarified |
Step two involves the submission of sealed priced bids by those who submitted acceptable technical proposals in step one. Bids submitted in step two are evaluated and the awards made in accordance with Subparts 14.3 and 14.4.

What are the two different ways to achieve best value in a negotiated procurement? Select all that apply.

| | Lowest Price Technically Affordable | | | Risk-Reward Tradeoff | | | Tradeoff process | | | Lowest Price Technically Acceptable |
Lowest Price Technically Acceptable and the tradeoff process are two different ways to achieve best value in a negotiated procurement.

Basic Types of Contracts and Agreements

The Right Tool for the Job
Having the right tool for the job can be critical. In the case of surgery, it might mean life or death. As acquisitions professionals, the FAR gives us many different contract types for our toolbox.

Selecting the right contract type is critical to obtaining an efficient effective acquisition. Normally, the contracting officer will select the contract type, but contractors have a large interest in the type. In negotiated procurements, contract type is negotiable.

Risk (Fixed-price vs. Cost Reimbursement) | |

Contract Category Characteristics

This chart highlights other differences between fixed-price and cost reimbursement contracts. | The contractor is fully responsible for costs in which type of government acquisition contract?

| | Firm-cost | | | Cost reimbursement | | | Pay for performance | | | Fixed-price | |
In a fixed-price contract, the contractor is paid a firm price. To the extent the contractor is efficient and reduces costs of performance, the contractor can earn more profit. If the cost of performance goes above the contract price, the contractor can actually lose money

Who does the risk of performance shift to in a cost reimbursement contract?

| | Contracting officer | | | Government | | | Project manager | | | Contractor |
In a cost reimbursement contract the risk of performance is shifted to the Government. The contractor is paid for all the costs that are incurred up to the amount stated in the contract.


Read FAR Subpart 16.2. Read carefully 16.202-1 and the other "-1" paragraphs which give the description of each contract type. Scan the rest of the text in this subpart noting that there is guidance on application, specific clauses, and limitations when using many of these types. Go to the FAR now to read Subpart 16.2, and 16.4 at FAR Subpart 16.2.

Key Characteristics * Contractor is obligated to perform satisfactorily * Financial liability is known * Government has remedies for unsatisfactory performance * Preferred contract type by Government

"All fixed-price contracts have some key characteristics in common. In all fixed-price contracts, the contractor is obligated to perform at a level that is satisfactory to the Government, the Government's financial liability is more or less known, and the Government has several remedies for if the contractor performs unsatisfactorily. Fixed-price contracts are always the preferred contract type by Government.

The Fixed Price Family: FPAF, FPIF, FFP. The FPAF graph shows the relation between Estimated Cost and Fee as it pertains to Award Fee (Award Fee Base line stays at 0-3% through the graph). The FPIF graph shows the relation of Target Cost to Target Profit as it relates to Share Ratio, PTA, and Ceiling Price. The FFP graph shows the relation of Estimated Cost to Fixed Fee as it relates to 100/0 Share (The 100/0 Share line is a vertical line). The narrator says "You will now see a graphical representation of how profit relates to costs in representative types of fixed-price contracts. Notice what happens to the line that represents profit and fee as costs increase or decrease."

The Family of Fixed-Price Contracts

| | 1. Firm Fixed-Price

A Firm Fixed-Price contract has a price that does not change based on costs of performance. It puts the least cost risk on the Government. This contract type is most commonly used for acquisitions under the SAT and is required for commercial item buys. 2. Fixed-Price with Economic Price Adjustment

This contract operates like a firm fixed-price contract except that certain prices may be adjusted based on economic conditions. You must keep in mind that the adjustments must be based on specific indexes or terms set forth in advance. Also, note that increases are limited. After the maximum increase, the contractor is responsible for any further increase. Decreases, however, are not limited 3. Fixed-Price Incentive (Firm Target or Successive Target)

This contract type attempts to shift some of the risk of cost overruns to the contractor and provide incentives to the contractor for saving costs. A target price, cost and profit are established. A share ratio is agreed upon to share in the savings or overrun as appropriate. Then a formula is utilized to apply the ratio based on actual costs. The actual procedure for this is beyond the scope of this course and will not be covered until you study level two materials. Incentives can also be based on performance parameters as well as costs, but cost must be an incentive. There are two types of Fixed-Price Incentive (FPI) contracts: Fixed-Price Incentive, Firm Target (FPIF), and Fixed-Price Incentive, Successive Targets (FPIS). FPIS contracts are used when there is greater cost risk 4. Fixed-Price Award Fee

Additionally, the FAR and the DFARS provide for another type of fixed-price contract that is considered an incentive contract. That is a Fixed-price Award Fee contract. Award fees are based on subjective evaluation criteria, while incentives are based on objective evaluation criteria 5. Fixed-Price Prospective Price Redetermination

This type of contract is intended for use when the immediate future is predictable, but the distant future is very unpredictable. The parties can agree to set a fixed-price for a set period of time, and then renegotiate the price for additional performance later when more information is available. This is only used if one of the types of fixed-price contracts previously mentioned will not fit your contracting situation. 6. Fixed Ceiling Price with Retroactive Price Redetermination

In this type of contract, the parties agree that they will establish a ceiling price that cannot be exceeded, and that the actual price cannot be determined before performance is completed. This type like the one above is for very specific situations. There are restrictive limitations to prevent its misuse 7. Firm Fixed-Price Level-of-Effort Term

With a level of effort contract, the exact product or service cannot be determined. The Government wants the contractor to provide experts to work on a project for a set number of hours. The contractor is paid a fixed-price for the effort that is provided by its employees. It requires special approval if it is to be used above the level of the SAT. This type of contract is often used for software revisions or development

Which of the following fixed-price contracts is influenced by national financial and market conditions?

| | Award Fee | | | Prospective Price Redetermination | | | Economic Price Adjustment | | | Incentive |
A Fixed-price with Economic Price Adjustment contract operates like a firm fixed-price contract except that certain prices may be adjusted based on economic conditions

What type of fixed-price contract is most suitable for investigation or study in a specific research or development area?

| | Prospective Price Redetermination | | | Economic Price Adjustment | | | Level-of-Effort Term | | | Retroactive Price Redetermination |
A firm-fixed-price, level-of-effort term contract is suitable for investigation or study in a specific research and development area. The product of the contract is usually a report showing the results achieved through application of the required level of effort. [FAR 16.207-2].

Cost Reimbursement Contracts

You will find Cost Reimbursement Contracts described in Subpart 16.3. Read 16.301 through 16.307. Just as you did in the previous sections, read carefully the paragraphs which give the description of each contract type. Scan the rest of the text in this subpart noting that there is guidance on application, specific clauses, and limitations when using many of these types. Go to the FAR now to read Subpart 16.3, and 16.405 Subpart 16.3.
Key Characteristics

* Reasonable estimate for SOW is agreed upon * Contractors must provide "best effort" * Government must pay all allowable and allocable costs
Just as fixed-price contracts have key characteristics in common, so do cost reimbursement contracts. In all cost reimbursement contracts, the Government and Contractor agree on a reasonable estimate for a known SOW. The contractor's obligation in cost reimbursement is to provide its "best effort" in attempting to perform the work, while the Government is obligated to pay all allowable and allocable costs that are reasonably incurred by the contractor up to the agreed upon estimate."

COST FAMILY : CPFF, CPAF, CPIF. The CPFF graph shows the relation between Estimated Cost and Fixed Fee as it pertains to 100/0 Share (The 100/0 Share line is a horizontal line). The CPAF graph shows the relation of Estimated Cost to Fee as it relates to Award Fee (The Award Fee Pool line is a horizontal line at 0-3%). The CPIF graph shows the relation of Target Cost to Target Fee as it relates to Share Ratio. The narrator says "This is a graphical representation of how the contractor's fee relates to costs in representative types of cost reimbursement contracts. Notice what happens to the line that represents fee as costs increase or decrease.

The Family of Cost Reimbursement Contracts

Types of Cost of Reimbursement

1. Cost Reimbursement with Zero Fees

Does it sound strange that someone would perform a government contract and not receive any profit? That is a cost reimbursement contract with zero fees. Sometimes we contract with universities or other organizations that are non-profit. Many of these organizations cannot accept a fee. 2. Cost-Sharing

This type sounds even more unusual than a cost reimbursement contract. In the cost-sharing contract, the Government and the contractor share in the costs. That is, the government reimburses the contractor for only a portion of the costs expended and the contractor receives no fee. Sometimes, especially in research and development, there are commercial applications that benefit the contractor doing the work. In such cases, contractors are willing to assist in paying for the work because of the benefits they receive. 3. Cost-Plus-Incentive-Fee

This contract operates similarly to the Fixed-price Incentive contracts. Incentives can be for cost or performance. There is a share ratio so that the contractor and Government share in cost savings and in cost overruns. The incentive fee is paid based on an objective formula pre-established in the contract. 4. Cost-Plus-Award-Fee

This is a contract type that allows the Government to provide incentives to the contractor based on performance evaluated using subjective performance criteria. The contractor is reimbursed for allowable costs, and may receive a fixed base fee of up to 3%. Note: the 3% limitation is a DoD limitation, not a FAR limitation on base fee. The Government award fee board evaluates the contractor's performance at scheduled intervals. The Government awards additional fees from an award fee pool. 5. Cost-Plus-Fixed-Base-Fee

The cost-plus-fixed-base-fee contract is the most common type of cost reimbursement contract. Like all the other contracts, the contractor is reimbursed allowable costs. In addition, the contractor is paid a fixed fee. The fee is for a fixed dollar amount, not a percentage. In fact, it is not permissible to award a contract that pays costs plus percentage of costs 6. Cost-Plus-Percentage-of-Costs

The one type of cost contract that is prohibited is cost-plus-percentage-of-costs. If the contractor's fee was based on how much money was spent in performance of the contract, the contractor would be incentivized to spend as much money as possible. You can see that this incentive would definitely NOT be in the Government's best interest.

What is the one type of cost reimbursement contract that is prohibited?

| | Cost-plus-incentive-fee | | | Cost-sharing | | | Cost-plus-award-fee | | | Cost-plus-percentage-of-costs |
The prohibited type of cost contract is a cost-plus-percentage-of-costs contract, in which the contractor would be incentivized to spend as much money as possible

What is the most common type of cost reimbursement contract?

| | Cost-plus-award-fee | | | Cost-plus-incentive-fee | | | Cost-sharing | | | Cost-plus-fixed-fee |
The cost-plus-fixed-fee contract is the most common type of cost reimbursement contract, where the fee is for a fixed dollar amount, set at the time of contract negotiation.

Special Types of Contracts

Situations can arise requiring contracts that do not fit neatly into one of the previously mentioned types. Contracting professionals are given latitude to deal with those special situations.

One method is to tailor the contract types. That is, you may develop a fixed-price contract with certain line items that are cost reimbursement. Or you could use a cost reimbursement contract with provisions that set certain line items as fixed-price or a contract with award fee incentives.

The FAR permits flexibility to award the type of contract appropriate to risk, performance likelihood and contractor's effort. Additionally, there are some special contract types that are included in the FAR that do not fit into either of the two we have studied so far.

Read about them now in FAR 16.6, then come back and continue this lesson.

Time and Materials
The Time and Materials contract is for special situations when two conditions exist: * The types of labor can be identified but not the actual time required * Materials are necessary to perform the contract, but the exact extent cannot be estimated before the work is to begin.
There are specific restrictions that apply to this type of contract. You must document the file that no other contract type is suitable by preparing a determination and findings (D&F). This is a formal document that lists the facts of the situation (findings) and states the type of contract to be used (determination). The second restriction is that a not-to-exceed ceiling price is established. This must be written into the contract so the contractor knows that if the ceiling price is exceeded, the Government will not reimburse the excess. Authorized personnel must validate labor and material costs

Labor Hours
A labor hour contract is very similar to a Time and Materials contract. The only difference is that in order to perform the contract, only labor, no materials, is required. The restrictions are the same as those for a Time and Materials contract. Like the Time and Materials type of contract, this arrangement is expensive for the Government to administer.

Letter Contracts
A letter contract is a preliminary contract. It is in writing and may not contain all necessary provisions. The FAR, however, requires that the letter contract include all FAR contract clauses for the type of definitive contract contemplated. The provisions are determined later when the letter contract is definitized. Does the letter contract sound like an unpriced purchase order?

The letter contract is similar to an unpriced purchase order. The major difference is that an unpriced purchase order can only be used within the SAT. As there is more money involved, and in order to protect the interests of the Governmen, there are more restrictions to using this type of contract. The letter contract must contain a not-to-exceed ceiling amount at time of award. This type of contract is often used in contingency situations or to ameliorate disasters. The contract may be used to repair complex, expensive equipment that is essential for operation or safety.

Materials are not supplied by the contractor for what special type of contract?

| | Time-and-materials | | | Labor-hour | | | Letter | | | Not-to-exceed-ceiling-price |

A labor-hour contract is a variation of the time-and-materials contract, differing only in that materials are not supplied by the contractor.

What special type of contract authorizes the contractor to begin immediately manufacturing supplies or performing services?

| | Letter | | | Time-and-materials | | | Labor-hour | | | Time-and-labor |
A letter contract is a written preliminary contractual instrument that authorizes the contractor to begin immediately manufacturing supplies or performing services.

Contracts for Recurring Payments
The Government buys the same things again and again. Shouldn't there be special contract methods or types to satisfy these requirements in an efficient manner? There are; and we shall learn about some of them in this course. Maintaining competition is always an issue when using vehicles for recurring requirements. We will not address competition in this lesson because it will be covered in detail in a future lesson.

Read FAR Subpart 16.7 and then return here.

16.702 -- Basic Agreements.
(a) Description. A basic agreement is a written instrument of understanding, negotiated between an agency or contracting activity and a contractor, that
(1) contains contract clauses applying to future contracts between the parties during its term and
(2) contemplates separate future contracts that will incorporate by reference or attachment the required and applicable clauses agreed upon in the basic agreement. A basic agreement is not a contract.
(b) Application. A basic agreement should be used when a substantial number of separate contracts may be awarded to a contractor during a particular period and significant recurring negotiating problems have been experienced with the contractor. Basic agreements may be used with negotiated fixed-price or cost-reimbursement contracts.
(1) Basic agreements shall contain --
(i) Clauses required for negotiated contracts by statute, executive order, and this regulation and
(ii) Other clauses prescribed in this regulation or agency acquisition regulations that the parties agree to include in each contract as applicable.
(2) Each basic agreement shall provide for discontinuing its future applicability upon 30 days’ written notice by either party.
(3) Each basic agreement shall be reviewed annually before the anniversary of its effective date and revised as necessary to conform to the requirements of this regulation. Basic agreements may need to be revised before the annual review due to mandatory statutory requirements. A basic agreement may be changed only by modifying the agreement itself and not by a contract incorporating the agreement.
(4) Discontinuing or modifying a basic agreement shall not affect any prior contract incorporating the basic agreement.
(5) Contracting officers of one agency should obtain and use existing basic agreements of another agency to the maximum practical extent.
(c) Limitations. A basic agreement shall not --
(1) Cite appropriations or obligate funds;
(2) State or imply any agreement by the Government to place future contracts or orders with the contractor; or
(3) Be used in any manner to restrict competition.
(d) Contracts incorporating basic agreements.
(1) Each contract incorporating a basic agreement shall include a scope of work and price, delivery, and other appropriate terms that apply to the particular contract. The basic agreement shall be incorporated into the contract by specific reference (including reference to each amendment) or by attachment.
(2) The contracting officer shall include clauses pertaining to subjects not covered by the basic agreement, but applicable to the contract being negotiated, in the same manner as if there were no basic agreement.
(3) If an existing contract is modified to effect new acquisition, the modification shall incorporate the most recent basic agreement, which shall apply only to work added by the modification, except that this action is not mandatory if the contract or modification includes all clauses required by statute, executive order, and this regulation as of the date of the modification. However, if it is in the Government’s interest and the contractor agrees, the modification may incorporate the most recent basic agreement for application to the entire contract as of the date of the modification.
16.703 -- Basic Ordering Agreements.
(a) Description. A basic ordering agreement is a written instrument of understanding, negotiated between an agency, contracting activity, or contracting office and a contractor, that contains
(1) terms and clauses applying to future contracts (orders) between the parties during its term,
(2) a description, as specific as practicable, of supplies or services to be provided, and
(3) methods for pricing, issuing, and delivering future orders under the basic ordering agreement. A basic ordering agreement is not a contract.
(b) Application. A basic ordering agreement may be used to expedite contracting for uncertain requirements for supplies or services when specific items, quantities, and prices are not known at the time the agreement is executed, but a substantial number of requirements for the type of supplies or services covered by the agreement are anticipated to be purchased from the contractor. Under proper circumstances, the use of these procedures can result in economies in ordering parts for equipment support by reducing administrative lead-time, inventory investment, and inventory obsolescence due to design changes.
(c) Limitations. A basic ordering agreement shall not state or imply any agreement by the Government to place future contracts or orders with the contractor or be used in any manner to restrict competition.
(1) Each basic ordering agreement shall --
(i) Describe the method for determining prices to be paid to the contractor for the supplies or services;
(ii) Include delivery terms and conditions or specify how they will be determined;
(iii) List one or more Government activities authorized to issue orders under the agreement;
(iv) Specify the point at which each order becomes a binding contract (e.g., issuance of the order, acceptance of the order in a specified manner, or failure to reject the order within a specified number of days);
(v) Provide that failure to reach agreement on price for any order issued before its price is established (see paragraph (d)(3) of this section) is a dispute under the Disputes clause included in the basic ordering agreement; and
(vi) If fast payment procedures will apply to orders, include the special data required by 13.403.
(2) Each basic ordering agreement shall be reviewed annually before the anniversary of its effective date and revised as necessary to conform to the requirements of this regulation. Basic ordering agreements may need to be revised before the annual review due to mandatory statutory requirements. A basic ordering agreement shall be changed only by modifying the agreement itself and not by individual orders issued under it. Modifying a basic ordering agreement shall not retroactively affect orders previously issued under it.
(d) Orders. A contracting officer representing any Government activity listed in a basic ordering agreement may issue orders for required supplies or services covered by that agreement.
(1) Before issuing an order under a basic ordering agreement, the contracting officer shall --
(i) Obtain competition in accordance with Part 6;
(ii) If the order is being placed after competition, ensure that use of the basic ordering agreement is not prejudicial to other offerors; and
(iii) Sign or obtain any applicable justifications and approvals, and any determination and findings, and comply with other requirements in accordance with 1.602-1(b), as if the order were a contract awarded independently of a basic ordering agreement.
(2) Contracting officers shall --
(i) Issue orders under basic ordering agreements on Optional Form (OF) 347, Order for Supplies or Services, or on any other appropriate contractual instrument;
(ii) Incorporate by reference the provisions of the basic ordering agreement;
(iii) If applicable, cite the authority under 6.302 in each order; and
(iv) Comply with 5.203 when synopsis is required by 5.201.
(3) The contracting officer shall neither make any final commitment nor authorize the contractor to begin work on an order under a basic ordering agreement until prices have been established, unless the order establishes a ceiling price limiting the Government’s obligation and either --
(i) The basic ordering agreement provides adequate procedures for timely pricing of the order early in its performance period; or
(ii) The need for the supplies or services is compelling and unusually urgent (i.e., when the Government would be seriously injured, financially or otherwise, if the requirement is not met sooner than would be possible if prices were established before the work began). The contracting officer shall proceed with pricing as soon as practical. In no event shall an entire order be priced retroactively.

Basic Agreements
The Basic Agreement (BA) establishes the terms and conditions that apply to contracts incorporating the agreement. These are general provisions that do not depend upon the services or supplies to be ordered. Some things a BA might include are the certifications and representations that a contractor must make about its firm: whether the firm is a small business, the contractor's tax number and other general information. Select DITCO BA for an example of a BA.

The BA helps resolve some issues early to facilitate the negotiations of individual contracts. It is especially effective when repetitive contracts with one vendor are contemplated. Some terms and conditions can be negotiated once and used again and again efficiently by incorporating the BA into the contracts.
Basic Ordering Agreements
The Basic Ordering Agreement (BOA) contains even more specific terms than the BA. It includes a description of the supplies or services to be ordered and can contain specific information regarding methods for pricing for labor or supplies. This makes it more similar to the BPA for simplified acquisitions. One important feature of any agreement is that the agreement in and of itself does not obligate the Government to place any orders. Each order under a BOA stands on its own.

What type of agreement is especially effective when repetitive contracts with one vendor are contemplated?

| | Basic Purchase Agreement | | | Blanket Agreement | | | Basic Agreement | | | Blanket Purchase Agreement |
The Basic Agreement (BA) is especially effective when repetitive contracts with one vendor are contemplated. It establishes the terms and conditions that apply to contracts incorporating the agreement. These are general provisions that do not depend upon the services or supplies to be ordered

Which of the following agreements is even more specific than the Basic Agreement because it contains methods for determining prices to be paid to the contractor for the supplies or services?

| | Blanket Agreement | | | Basic Ordering Agreement | | | Blanket Purchase Agreement | | | Basic Blanket Agreement |
The Basic Ordering Agreement (BOA) contains even more specific terms than the BA. It includes a description of the supplies or services to be ordered and can contain specific information regarding methods for pricing for labor or supplies.

Indefinite Delivery Contracts
Read about these contracts in FAR Subpart 16.5. Read carefully 16.500 through 16.504. Then scan the rest of the subpart that contains the details on using these contract types. Read FAR Subpart 16.5 now; then return to the lesson.
Indefinite Delivery Contract Types * Definite Quantity * Requirements * Indefinite Quantity
There are three types of indefinite delivery contracts. Definite Quantity highlights and the following bullets display during the narration: * Most specific * Time or place is unknown * May be awarded to multiple contractors
Definite quantity is the most specific. The Government has a requirement for a specific quantity of either supplies or services. What is unknown is the exact time or place for delivery. The contract can be written and then the items ordered as needed over the term of the contract. Definite quantity contracts may be awarded to multiple contractors for the same type of supplies or services, unlike requirements contracts."

Requirements highlights and the following bullets display during the narration: * Less specific than Definite Quantity * Provides at a specific price for specific term * Government promises exclusivity
A Requirements contract is less specific than a definite quantity contract. The Government is not sure exactly how many supplies or how much services might be required. A contract is written to provide the supplies and services when needed at a specific price for a specific term. In exchange for the contractor promising to provide the supplies and services as ordered and to guarantee their prices for a specific term, the Government makes a promise to the Contractor. The promise is one of exclusivity. The Government promises that it will not buy those supplies and services from any other contractor during the term of the contract."

Indefinite Quantity highlights and the following bullets display during the narration: * Least specific * Establishes prices for a specified term * Government guarantees a minimum quantity order * Maximum amount specified * Non-exclusivity

"The indefinite quantity is the least specific of the indefinite delivery contracts. Sometimes the Government expects a need for supplies or services. The Government cannot state exactly the extent of the need and wants to keep options open to order the supplies or services from other contractors if necessary. The Government can still use an Indefinite Quantity type contract. The contract establishes prices for the supplies or services that can be ordered for a specified term. The unique feature of the Indefinite Quantity contract is that at the time the contract is awarded, the Government guarantees that they will order a minimum quantity. A maximum amount is also specified. The Contractor is not obligated to supply anything in excess of the maximum. The Government retains the right to order the same supplies and services from other vendors."

What are the three types of indefinite-delivery contracts? Select all that apply.

| | Definite-quantity | | | Requirements-quantity | | | Requirements | | | Indefinite-quantity | | | Indefinite-definite | | | Indefinite-requirements |

The three types of indefinite-delivery contracts are definite-quantity contracts, requirements contracts, and indefinite-quantity contracts. The appropriate type of indefinite-delivery contract may be used to acquire supplies and/or services when the exact times and/or exact quantities of future deliveries are not known at the time of contract award

What type of contract includes a promise of exclusivity from the Government?

| | Requirements contract | | | Indefinite quantity contract | | | Definite quantity contract | | | Basic ordering agreement |
The Government promises that it will not buy the supplies and/or services covered by the contract from any other contractor during the term of the contract.

Welcome to Practical Exercise: Use of Various Types of Contracts! Read the scenario; then, answer a practice question to apply what you learned. Good luck!

James Newman, Contracting Officer (CO), currently has five separate contract actions to award for the 38th Security Detachment: * A contract for 6 months of office supplies estimated to cost $200,000 * 70 computers estimated to cost $210,000 * Furniture for 70 people plus conference rooms * A security fence and guardhouse estimated to cost $2 million, and * An IT service contract estimated to cost between $2 million and $4 million

Based on FAR 16.2 which type of contract should James use for the 70 computers?

| | Fixed Price | | | Cost Reimbursement | | | Firm-Cost | | | Pay-for-performance |
James should use a fixed price contract

Competition Requirements
Under simplified acquisition threshold (SAT), you were allowed more flexibility in making contracting decisions. When you make more expensive purchases, the rules are more structured. There is much more at stake for both the Government and the contractor.
The Terminal Learning Objective is: Given a customer requirement, apply competition requirements.

Select the Enabling Learning Objective button to view the Enabling Learning Objectives for the lesson.

The Enabling Learning Objectives are: * Apply competition requirements using simplified acquisition procedures (SAP). * Apply competition requirements that exceed the simplified acquisition threshold (SAT).
General Principles for Competition under SAT Purchases
Take a moment to review the soliciting competition requirements at FARS clause 13.106-1; then return to this lesson. * Limiting competition * Sole source or limited source
Also, recall the Total Small Business Set-Aside under the SAT covered in FAR 19.502-2(a).
13.106-1 Soliciting competition.
(a) Considerations. In soliciting competition, the contracting officer shall consider the guidance in 13.104 and the following before requesting quotations or offers:
(1)(i) The nature of the article or service to be purchased and whether it is highly competitive and readily available in several makes or brands, or is relatively noncompetitive.
(ii) An electronic commerce method that employs widespread electronic public notice is not available; and
(iii) The urgency of the proposed purchase.
(iv) The dollar value of the proposed purchase.
(v) Past experience concerning specific dealers’ prices.
(2) When soliciting quotations or offers, the contracting officer shall notify potential quoters or offerors of the basis on which award will be made (price alone or price and other factors, e.g., past performance and quality). Contracting officers are encouraged to use best value. Solicitations are not required to state the relative importance assigned to each evaluation factor and subfactor, nor are they required to include subfactors.
(b) Soliciting from a single source.
(1) For purchases not exceeding the simplified acquisition threshold, 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).
(2) For sole source (including brand name) acquisitions of commercial items in excess of the simplified acquisition threshold conducted pursuant to Subpart 13.5 the requirements at 13.501(a) apply.
(3) See 5.102(a)(6) for the requirement to post the brand name justification or documentation.
(c) Soliciting orally.
(1) The contracting officer shall solicit quotations orally to the maximum extent practicable, if—
(i) The acquisition does not exceed the simplified acquisition threshold;
(ii) Oral solicitation is more efficient than soliciting through available electronic commerce alternatives; and
(iii) Notice is not required under 5.101.
(2) However, an oral solicitation may not be practicable for contract actions exceeding $30,000 unless covered by an exception in 5.202.
(d) Written solicitations. If obtaining electronic or oral quotations is uneconomical or impracticable, the contracting officer should issue paper solicitations for contract actions likely to exceed $30,000. The contracting officer shall issue a written solicitation for construction requirements exceeding $2,000.
(e) Use of options. Options may be included in solicitations, provided the requirements of Subpart 17.2 are met and the aggregate value of the acquisition and all options does not exceed the dollar threshold for use of simplified acquisition procedures.
(f) Inquiries. An agency should respond to inquiries received through any medium (including electronic commerce) if doing so would not interfere with the efficient conduct of the acquisition.

Limiting Competition

What happens if you need to limit competition due to circumstances out of your control? Suppose your customer calls to tell you the roof is leaking in his or her main computer area. If the situation is not taken care of immediately, the customer will likely suffer significant losses. In this situation, do you think you have time to go out for bids in the market place? It's not likely!

The Government allows you, as the contracting officer, to solicit from a single source if you determine that the circumstances of the contract indicate that only one source is reasonably available to satisfy a need of unusual and compelling urgency. The roof leak described above is an example of an urgent need. Under the SAT, you have broad authority to make these determinations

Sole Source or Limited Source

Sole source, or limited source, describes a single contractor who is capable of filling a requirement. Sometimes it is necessary to use a sole source because they have the only product that will meet the customer's needs. Other times, you use a sole source because you need something to meet an immediate need, like the roof leak above. There are also other requirements you need to implement to protect the Government's interest
Contingency Operations or Homeland Security
Contingency Operations: * Any operation designated by SecDef where members of the armed forces are or may be involved in military actions, operations or hostilities against an enemy of the US * May be used to meet the challenges of a national emergency declared by the President or Congress * This authority is intended to allow you authority to use streamlined procedures to rapidly meet a contingency or emergency requirement.

When you are procuring requirements in support of Contingency Operations or Homeland Security, additional authority is provided to substantially increase the dollar thresholds for using micro-purchase authority or Simplified Acquisition Procedures. Recent changes to this authority added operations including recovery from nuclear, biological, chemical, or radiological attack.

Contingency Operations are defined as any operation designated by the Secretary of Defense where members of the Armed Forces are or may be involved in military actions, operations or hostilities against an enemy of the US. It also may be used to meet the challenges of a national emergency declared by the President or Congress. This authority is intended to allow you authority to use streamlined procedures to rapidly meet a contingency or emergency requirement.

Small Business Set-Asides
Purchases expected to exceed the micro-purchase threshold but not exceed SAT must be set-aside for small business; however, just because a procurement action is over SAT does not mean that that action could not be set aside.

To better understand how set-asides affect competition, please read FAR 6.203 through 6.205; then return to this lesson.

Micro-Purchase Requirements

Micro-purchases: * Provide considerable latitude making purchases below the micro-purchase threshold * Do not require solicitation of more than one vendor * Expedite the procurement process * Allow you to quickly meet customer requirements
Find guidance at FAR 13.202.

You are obligated to ensure that you distribute these purchases equally among all qualified vendors.

Remember that the Javits-Wagner-O'Day (JWOD) Act (AbilityOne Program) is applicable to these purchases. You can determine that limited competition is in the Government's interest.
Requirements Greater than Micro-Purchase but Below SAT
* Always consider dollar values * Expect the level and availability of competition to vary * Solicit sole source, when applicable * Solicit at least three sources, when available * If possible, solicit two sources not included in the previous solicitation
When soliciting requirements greater than the micro-purchase threshold, there are certain things you should consider concerning competition. You previously read those requirements at FAR 13.106-1, but you may want to look again if you didn't consider the dollar values.

Every procurement action is different, so you can expect the level and availability of competition to vary. You may have only one source of supply (sole source) or you may have many. In your reading at FAR 13.106-1 you learned that you can solicit one source if you determine that circumstances of the contract action or your market research deemed only one source reasonably available.

If there are multiple sources available, however, you should solicit at least three. It also suggests obtaining quotes from two sources not included in the previous solicitation. This is intended to generate additional competition. You have the authority to make a sole source or limited source determination for purchases under the SAT, and must document the contract file with the rationale

To help ensure competition, you must comply with the public display and synopsizing requirements identified at FAR 5.101 and 5.203.

Synopsize means to advertise the intention to contract for a requirement. The Government publicizes its intention to contract requirement for a requirement to increase competition. You may post solicitations expected to be valued between $15,000 and $25,000 in a public place; however, you must publish solicitations expected to exceed $25,000 on the FedBizOpps website–the Government's Point of Entry (GPE). This advertisement must also include, a description of the work.

For solicitations under the SAT, you are encouraged to solicit quotations orally, to the maximum extent possible. This practice may greatly increase competition

__________ is used to determine whether supplies or services to be purchased are available from one or many sources.

| | A procurement contract | | | Sole sourcing | | | An acquisition procedure | | | Market research |
Market research is used to determine whether the supplies or services to be purchased are available from one or many sources

What Government official can designate Contingency Operations? Select all that apply.

| | The President of the United States | | | Secretary of Defense | | | Secretary of Homeland Security | | | Secretary of State |
The President of the United States and the Secretary of Defense designate Contingency Operations.

When is it acceptable to solicit one vendor under the micro-purchase threshold?

| | When the price is reasonable | | | When it can expedite the procurement process | | | When it is in the Government's best interest | | | When it quickly meets the customer's requirements |
If the price is reasonable, it is acceptable to solicit to one vender under the micro-purchase threshold.

You may post solicitations expected to be valued between $15,000 and __________ in a public place; however, you must publish solicitations expected to exceed __________ on the FedBizOpps website–the Government's Point of Entry.

| | $25,000; $25,000 | | | $25,000; $100,000 | | | $50,000; $125,000 | | | $50,000, $50,000 |
Solicitations expected to be valued between $15,000 and $25,000 may be posted in a public place; however, you must publish solicitations expected to exceed $25,000 on the FedBizOpps website–the Government's Point of Entry.

Competition in Contracting Act
In 1984, Congress passed the Competition in Contracting Act (CICA) that established a requirement for executive agencies to use competitive procedures to acquire supplies and services. Competitive procedures are the procedures under which an agency enters into a contract pursuant to full-and-open competition. With certain limitations, CICA also created exceptions for certain categories of procurements to the full and open competition requirement.

Among these exceptions are seven categories of circumstances. These circumstances require that you write justifications, management approvals at certain dollar levels, and public notices, as appropriate

Take a moment and read FAR 6.101. It outlines the Government's policy for competition requirements.

Basically, with few exceptions, it states that you, as a contracting officer, shall provide for full and open competition
6.101 -- Policy.
(a) 10 U.S.C. 2304 and 41 U.S.C. 253 require, with certain limited exceptions (see Subparts 6.2 and 6.3), that contracting officers shall promote and provide for full and open competition in soliciting offers and awarding Government contracts.
(b) Contracting officers shall provide for full and open competition through use of the competitive procedure(s) contained in this subpart that are best suited to the circumstances of the contract action and consistent with the need to fulfill the Government’s requirements efficiently (10 U.S.C. 2304 and 41 U.S.C. 253).
Principles of Full-and-Open Competition
So, what is meant by the term full-and-open competition? Generally, when we say full-and-open competition, we mean that all responsible sources are permitted to compete.

Read FAR 6.102.

This section specifies the competitive procedures for use in: * Sealed biding * Competitive proposals * Combination of competitive procedures * Other competitive procedures

Other Competitive Procedures

Other competitive procedures include: * Selection of Architect-Engineer services * Competitive selection of basic and applied research * Use of General Services Agency (GSA) multiple award schedules (MAS)
6.102 -- Use of Competitive Procedures.
The competitive procedures available for use in fulfilling the requirement for full and open competition are as follows:
(a) Sealed bids. (See 6.401(a).)
(b) Competitive proposals. (See 6.401(b).) If sealed bids are not appropriate under paragraph (a) of this section, contracting officers shall request competitive proposals or use the other competitive procedures under paragraph (c) or (d) of this section.
(c) Combination of competitive procedures. If sealed bids are not appropriate, contracting officers may use any combination of competitive procedures (e.g., two-step sealed bidding).
(d) Other competitive procedures.
(1) Selection of sources for architect-engineer contracts in accordance with the provisions of 40 U.S.C. 1102 et seq. is a competitive procedure (see Subpart 36.6 for procedures).
(2) Competitive selection of basic and applied research and that part of development not related to the development of a specific system or hardware procurement is a competitive procedure if award results from --
(i) A broad agency announcement that is general in nature identifying areas of research interest, including criteria for selecting proposals, and soliciting the participation of all offerors capable of satisfying the Government’s needs; and
(ii) A peer or scientific review.
(3) Use of multiple award schedules issued under the procedures established by the Administrator of General Services consistent with the requirement of 41 U.S.C. 259(b)(3)(A) for the multiple award schedule program of the General Services Administration is a competitive procedure.

Using competitive procedures provides the means for meeting the requirement for full-and-open competition. In some of these procedures: * You synopsize using full and open competition by requesting proposals to cover a specific period of time * You competitively select one or more of the sources for future orders
By synopsizing, we can sometimes establish competitive procedures that can be used to quickly fulfill your customer's needs.

There is more than one way to let potential contractors know your needs, but synopsizing is probably the most effective.

Can the Government use the Internet to increase competition in its acquisitions? Certainly, and that is exactly what has happened. During the time eBay was growing so quickly, the Government stopped publishing the Commerce Business Daily (CBD), a paper magazine advertising government procurements. The Government created Federal Business Opportunities at FedBizOpps is an internet-based web page where anyone in the world can go to find notices of government solicitations and awards. Your solicitation can now be viewed by anyone, anywhere in the world. This is a huge advantage in terms of generating competition. This type of advertising is sure to increase competition. The FAR specifies the dollar value to advertise all requirements, with some exceptions

Using strategies to establish requirements documents that permit a broad range of proposals will help you to maximize competition.

You have considerably less discretion for deciding not to use full-and-open competition in your contract actions, but as you will learn, there are exceptions.

The documentation for exceptions is more rigid, and the approval authority, which is established based on value of the action, may be well above your authority

Competitive procedures are the procedures under which an agency enters into a contract pursuant to __________ and __________ competition.

| | Complete, open | | | Full, open | | | Complete, exposed | | | Full, exposed |
Competitive procedures are the procedures under which an agency enters into a contract pursuant to "full and open competition."

What did the Government create to publicly display notices of Government solicitations and awards?

| | eBAY | | | Commerce Business Daily | | | Auction Web | | | |
The Government created to publicly display notices of Government solicitations and awards.

Contracting Situations
Both law and regulation recognize three contracting situations relative to competition: * Full-and-open competition * Full-and-open competition after exclusion of sources * Other than full-and-open competition
These contracting situations have specific policies and procedures for their use.
Full-and-Open Competition

In this situation, all responsible sources are permitted to respond and compete for Government contracts. Obtaining competition is both feasible and practicable.

Full-and-Open Competition After Exclusion of Sources

To exclude a source: * Determine that FAR 6.202 conditions are met * Document exclusion reason(s) * Get approval from the head of your agency * Complete determination and findings (D&F) * Ensure a justification and approval (J&A) is prepared and approved
The ultimate goal is to develop alternate sources and increase competition.

Other than Full-and-Open Competition

In this situation, limited competition or sole source contracting is required to meet agency requirements. CICA permits using sole source contracting, but controls the application by prescribing seven statutory exceptions to full-and-open competition. Unless one of these exceptions can be applied, a sole source or limited competition contract cannot be awarded. A J&A must be prepared in situations where full-and-open competition is not used.

You will find information on this type of situation in FAR 6.302.

Statutory Exceptions to Full-and-Open Competition
Exceptions to Full and Open Competition * Only one responsible source * Unusual and compelling urgency * Industrial mobilization * International agreement * Authorized or required by statute * National security * Public interest
The statutory exceptions are listed in FAR Part 6.302-1 through 6.302-7.

Contracting without full and open competition is a violation of the law, unless it is permitted by an exception. Let's look at the procurement exceptions that allow you to deviate from using full and open competition.

Exceptions to full and open competition: * Only one responsible source * Unusual and compelling urgency * Industrial mobilization * International agreement * Authorized or required by statute * National security * Public interest
The statutory exceptions are listed in FAR Part 6.302-1 through 6.302-7

What must be prepared if full-and-open competition contracting is not used?

| | Justification and findings | | | Determination and approval | | | Findings and approval | | | Justification and approval |
Justification and approval is prepared whenever full and open competition is not used.

You have written a justification that allows contracting without full-and-open competition. The justification stated that due to unseen circumstances time has greatly impacted finding multiple sources for competition. Which of the following exceptions listed in the FAR Part 6.302-1 through 6.302-7 would allow this?

| | Public interest | | | Unusual and compelling urgency | | | Only one responsible source | | | Authorized or required by statute |
Unusual and compelling urgency would allow this contracting situation to be exempt from full and open competition

DFARS Coverage of Other Than Full-and-Open Competition

Take a few minutes and read the examples and applications found in DFARS 206.3.

In your reading of DFARS 206.3, you saw the examples relating to the unusual and compelling urgency exceptions. They are important, so let's review them again
Written Justifications and Approvals
The J&A documents the reason(s) for action and must be signed at the appropriate level of approval.

FAR 6.303 and FAR 6.304, respectively, specify the justification and approval requirements. The FAR tells you what types of justifications, based on contract dollar amount, are required and the requisite approval levels.

DFARS 206.303 and DFARS 206.304 provide additional guidance.

Supplementary requirements may also be imposed at your location

Freedom of Information
When determining whether other data should be removed, refer to the exemptions to disclosure information contained in the Freedom of Information Act (FOIA) (5 U.S.C.552) and the prohibitions against disclosure in FAR 24.202.

If you receive a Freedom of Information request, you must comply with FAR 24.2.

Competition Advocates
The Office of Federal Procurement Policy Act established the requirement for a competition advocate (CA). The head of each executive agency has to designate a CA for the agency and for each procuring activity of the agency.

Take a moment to read FAR 6.5.
CAs also recommend a system of personal and organizational accountability for competition that may include using recognition and awards to motivate you, your program managers, and others in authority. These efforts help to promote competition in acquisition.

You learned in FAR 6.5 about the agency CA. Many times there will be additional CAs at different levels of a buying activity with similar duties. Additionally, you are often the most effective advocate of competition and, as such, you have the greatest influence on competition for your particular procurements.

Competitive Proposals With or Without Discussions
You may request competitive proposals whenever sealed bids are not appropriate.

FAR 15.000 states, "A contract awarded using other than sealed bidding procedures is a negotiated contract."

Discussions are often necessary and can enhance competition for your acquisition

Mr. James Newman, the contracting officer (CO), will be considering the one requirement for the 38th Security Detachment that is not yet a priority. At the end of the operation, there is a requirement that all the computers be completely destroyed by an outside contractor under the supervision of two military members of the 38th Security Detachment. This effort will require that a new contract be awarded.

A review of the contract files indicates that there have been some contracts for the destruction of computer hard drives and recycling of the rest of the computer parts. The latest contract indicated a price of about $2,000 per computer. There will be 70 computers to destroy. At $2,000 each, that would be $140,000, within the Simplified Acquisition Threshold (SAT). However, these computers will require complete destruction with no recycling of any parts. It may cost more to do this. James has asked the Small Business Specialist (SBS) and the Competition Advocate (CA) to help him identify potential sources for this work.

Based on what you now know, which method of contracting would be appropriate for the destruction of the 70 computers?

| | Fixed price | | | Cost reimbursement | | | Sealed bidding | | | Open bidding |
James should use a sealed bid contracting method to destroy the computers

Acquisition Strategy Development
The Terminal Learning Objective is: Given a customer need, develop an acquisition.

Select the Enabling Learning Objective button to view the Enabling Learning Objectives for the lesson.

The Enabling Learning Objectives are: * Identify characteristics of best value. * Identify the relationship between best value, acquisition planning, and achieving mission goals. * Identify the elements of a written acquisition plan. * Identify the elements of source selection planning. * Determine the criteria in developing an acquisition strategy.
Characteristics of Best Value
Concepts of Best Value
The concept of Best Value refers to the expected outcome of an acquisition that in the customer's estimation provides the greatest overall benefit in response to his or her requirements.

Best Value Continuum
All solutions between the two points are the result of a tradeoff process, where elements of the proposed solution are traded off against each other, and against price, to arrive at the best overall deal for the Government. Where the solicitation falls on this continuum depends on the following information: * Threshold requirement(s) * Budget * State of technology * Business environment * A number of other characteristics of the procurement
Know Your Customers
To be a truly effective broker for your customer and their requirements, you must seek to understand the organization's culture.

Additionally, understanding aspects about the customer is paramount
Organizational Culture

The organizational culture consists of its: * Mission * Vision * Values * Objectives * Priorities
Customer Aspects

Aspects include: * How your customer's requirements support the goals of their organization * Who the customer themselves support and their mission * Their Concept for Employing and Operating (CONOPS) the procured items
Describing Agency Needs
Once you understand the needs of your customers, offer your assistance with describing their needs in a manner that will allow the widest response to their solicitations.

At a minimum, advise your customers to state their needs in the following manner: * One that promotes full-and-open competition, or maximum practicable competition when using simplified acquisition procedures * Only includes restrictive provisions or conditions to the extent necessary to satisfy specific needs or as authorized by law
You should also advise your customers to state their requirements with respect to an acquisition of supplies or services in terms of: * Functions to be performed * Performance required * Essential physical characteristics
Tradeoff Process
The tradeoff process is appropriate when it may be in the best interest of the Government to consider award to other than the lowest priced offeror or other than the highest technically rated offeror.

This process permits tradeoffs among cost or price and non-cost criteria and allows the Government to accept other than the lowest priced or best value proposal. When conducting trade-off decisions, the perceived benefits of the higher-priced proposal must merit the additional cost, and the rationale for tradeoffs must be documented in the contract file.
Tradeoff Process Rules
In the solicitation, you must apply the following rules when using a tradeoff process and clearly state: * All evaluation criteria and significant subcriteria that will affect contract award and their relative importance * Whether all evaluation criteria other than cost or price, when combined, are significantly more important than, approximately equal to, or significantly less important than cost or price
Evaluation Criteria
Use evaluation criteria to: * Evaluate how well each offeror's approach meets the requirements of the RFP * Identify strengths and weakness in proposals * Distinguish among proposals so that you can pick the contractor who will provide the best value to the Government
Criteria establish the broad categories that will be considered in the source selection decision. Criteria are broken down into more detailed subcriteria, and their relative order of importance is determined. Finally, standards are established to enable the Government to rate each proposal against the established criteria/subcriteria.

Review FAR 15.304 on developing and using evaluation criteria
Evaluation criteria address the broad areas of a contractor's proposal that will be reviewed and assessed by the Government to form the basis for the contract award decision. | Certain evaluation criteria such as evaluation of price or cost, quality in every source selection, past performance, and small business participation, in many instances, are required. |
Evaluation Criteria

Examples of evaluation criteria include entities such as cost, quality, technical approach, expertise, management capability, past performance, personnel qualifications, and small business participation.
Criteria and subcriteria should support meaningful discrimination among competing proposals.

The number of criteria and subcriteria is dependent on the complexity, cost, and type of solicitation, but, in general, criteria and subcriteria should be limited to the number required to provide selection personnel with the ability to effectively discriminate among proposals.

It is good practice to minimize the evaluation criteria, especially in the technical areas.

In general, the more criteria and subcriteria involved, the more difficult it will be to make the best value decision

To provide customers with the best value in writing contracts, you should always attempt to match the right __________ to the customer's __________ at an affordable price.

| | Tradeoff, requirements | | | Product, marketplace | | | Solution, requirements | | | Solution, marketplace |
In its simplest form, best value is matching the right solution to the customer's requirements at an affordable price

Which evaluation criteria would you have employed, if you rejected an offeror's response to an RFP for the following reasons? * Organization failed to meet prior contract deadlines * Organization often delivered an unacceptable percentage of inoperable products * Organization is starting to move to a new field

| | Technical approach, quality, cost | | | Past performance, quality, expertise | | | Cost, quality, personnel qualifications | | | past performance, quality, cost |
Important evaluation criteria include cost, quality, technical approach, expertise, management capability, past performance and personnel qualifications; past performance, quality, and expertise are in doubt in this situation.

Market Research
Market research is conducted to determine if commercial items or non-developmental items are available to meet the Government's needs or could be modified to meet the Government's needs.

Market surveys are a critical part of acquisition planning.
Understand the Business Environment
Once you've become familiar with your customer, their requirements, and the marketplace and its potential to satisfy these requirements, you must become familiar with the business environment within which both parties exist.

The Government's ability to accomplish its acquisition goals and objectives is a function of several competing forces.
Competing Forces

The acquisition process is influenced by the marketplace, political arena, legal community, and internal organizations.
Market forces and conditions largely determine: * Whether or not the Government can fulfill its needs with a commercial item, non-developmental item (NDI), or an item manufactured specifically for Government use (non-commercial item) * The timeliness and quality level of fulfillment * Cost of the supplies or services * Risks inherent in the acquisition * Degree to which socioeconomic objectives can be accomplished and alternatives for accomplishing them * The level and nature of competition for the acquisition * The potential tradeoffs among quality, timeliness, and cost

Captive Marketplace
Some supplies and services are required only by the Government and have no commercial counterparts (e.g., weapon systems).

When these Government-specific (non-commercial) supplies or services create a marketplace that is generally limited in scope and competition, it may become a captive market.
Political Arena
The political arena refers to the interactions among the three branches of Government and the public.

The interactions focus on: * Legislative authority for the program or programs to be supported by the acquisition * Appropriations for the program or department that would fund the acquisition * Statutes that govern the acquisition process * Congressional oversight of specific programs or the acquisition process in general * Public acceptance of the acquisition
The acquisition ultimately supports a program established through a political process and is conducted according to policies and rules that are often established through that same process.

The larger the acquisition, the more likely it is to be directly influenced by politics
Legal Community
In contract law, there are many parallels to the private sector in relation to federal contracts. There are also many differences.

Some significant challenges peculiar to Government procurements include: * Apparent Authority * Contract Clauses * Funding * With Whom to Contract
Apparent Authority

The Government is not bound by the unauthorized acts of its agents. This doctrine often comes into focus when there is a question whether the actions of a person representing you, the contracting officer, are binding on the Government
Contract Clauses

Many clauses found in Government contracts are not normally found in private sector contracts, or they depart significantly from terms and conditions customary in the private sector.

Funds appropriated by Congress may be used only for the purposes for which they were appropriated
With Whom to Contract

Many laws and regulations that place constraints on an offeror's eligibility to receive a Government contract are unique in whole or in part to Government contracting.
Steps in the Acquisition Process
The process of soliciting and awarding federal contracts is prescribed in far greater detail in laws and regulations than in private sector contracting.

Offerors may use unique procedures and forums for protesting federal contract awards if these are not made according to those laws and regulations.
Internal Organizations
Organizational criteria that affect the performance of the acquisition system include: * Organization's mission * Delegations of authority * Staffing levels * Critical criteria and standards of performance
Organization's Mission

The organization's mission includes the primary types of supplies or services required for that mission
Delegations of Authority

Delegation of authority considers three things: * Who the decision makers are * What the decision makers have the authority to decide * The quality of personnel and their knowledge of acquisition tasks, skills at performing acquisition tasks, and their ability to exercise delegated authority
Staffing Levels

Staffing levels consider: * Ratio of contract specialists to contract actions * Number of staff hours available for each action * Internal controls and oversight * Performance evaluations
Critical Criteria and Standards of Performance

Critical criteria and standards of performance are applied as follows: * Who audits performance * How is work sampled and reviewed

The interactions among the three branches of Government and the public are known as what?

| | Legislative arena | | | Political arena | | | Statutes | | | Public acceptance |
The interactions among the three branches of government and the public are referred to as the political arena.

If an offeror inquires about significant legal challenges peculiar to Government procurement, which ones will you mention?

| | Government clauses, contract authority, contract timeframe, funding | | | Apparent contract, contract authority, Government clauses, funding | | | Apparent authority, contract clauses, funding, who to contract with | | | Contract timeframe, apparent contract, Government clauses, contract authority |
Some of the most significant challenges peculiar to government procurement include apparent authority, contract clauses, funding, and who to contact with

Relationship Between Best Value‚ Acquisition Planning‚ and Achieving Mission Goals

Obtaining Best Value
To obtain the best value for your customer, you can use any one, or a combination of, source selection approaches. Keep in mind that in different types of acquisitions, the relative importance of cost or price may vary.

For example, in an acquisition where the requirement is clearly definable and the risk of unsuccessful contract performance is minimal, cost or price may play a dominant role in source selection. The less definitive the requirement, the more development work required, or the greater the performance risk, the more technical or past performance considerations may play a dominant role in source selection

Acquisition Business Case
In preparing an acquisition business case, consider regulatory and statutory influences.

Also consider the following criteria: * Acquisition phase * Contract type * Inherent risk
The contractor considers the same influences and criteria, but may develop a different assessment.

By discussing these differences, the contractor and the Government are given an opportunity to more fully understand the other's perspective and can constructively participate in determining which contractual incentives are motivators for industry, and what incentives the Government can offer that will meet the goals of both parties. The acquisition business case serves as the framework for developing the acquisition plan.
Regulatory and Statutory Influences

Regulatory and statutory influences are barriers like political, cultural, and contractual issues
The benefits of building an acquisition business case are: * Documentation * Customer/Project goals and objectives * Risk assessments * Applied weighted values given to performance, cost, and schedule (evaluation criteria) * Identification of incentive strategies, i.e. the desirable and undesirable outcomes for both parties
Steps to Building an Acquisition Business Case 1. Step 1: Identify Risk
Types of risks you should consider include: * Financial risks * Technical risk * Market risk * Schedule risk
Financial Risk

Financial risks are from both a Government and an industry perspective. Industry considers financial risk to be a measure of the likelihood of the potential contract achieving its financial objectives.
Technical Risk

Technical risk is the potential for success of the design effort
Market Risk

Market risk includes price risk, which is the industry's ability to maintain the price of the goods or services
Schedule Risk

Schedule risk is the industry's ability to meet planned schedule.

2. Step 2: Identify Business Influences (Barriers) * Identify all the barriers: * Cultural beliefs held by industry and Government regarding their business relationship * Structural mechanics of the business relationship and processes that operate within this relationship * Statutory and regulatory restrictions, mandates, or guidance that affect the structure and execution of the business relationship * Financial impacts to the business relationship from the appropriation process and internal process of allocating funds within the corporate industry and Government management process * Look at contractual impacts on the contract agreement (structure) and specific contractual relationship. * Identify programmatic influences affecting program management and plan execution. * look at the political impacts of Congressional actions, as well as those of Government and industry on the business relationship. 3. Step 3: Consider Business Criteria
Business criteria includes: * Requirement * Acquisition phase * Contract type * Performance history * Corporate strategy

What is needed and what is being purchased
Acquisition Phase

The major phase of the acquisition cycle
Contract Type

Fixed price, cost reimbursement, or other ordering vehicles
Performance History

Contractors' interest in this is not just for future work with the Government, but also how industry perceives them
Corporate Strategy

Areas important to the contractor, e.g., cash flow, technology improvement, and market share

4. Step 4: Identify Inherent Risk
The two areas to be considered when identifying inherent risk are: * The probability of the contractor failing to meet the requirements of the potential contract * The consequences of the contractor's failure to meet the requirements of the potential contract

5. Step 5: Identify Government Tools/Processes for Dealing with Risk
The last step in building an acquisition business case is to identify any Government tools and processes for dealing with risk.

While you are building an effective relationship with your customers and vendors, what are you essentially building if you are focusing on understanding the cultural and financial environment in which a requirement operates?

| | Requirement case | | | Best case | | | Acquisition business case | | | Best value case |
You are building an acquisition business case when you focus on understanding the cultural and financial environment in which a requirement operates.

If you are discussing the structural mechanics of the business relationship approach with your customer, which step are you taking to build your acquisition business case?

| | Identify risk | | | Identify business influences (barriers) | | | Consider business criteria | | | Identify inherent risk |

Business influences (barriers) include the structural mechanics of the business relationship approach

Acquisition Strategy Development
Elements of a Written Acquisition Plan
Acquisition Plans
Defense acquisition plans address content area identified in FAR 7.105 and DFARS 207.105.

In accordance with Executive Order 13101 per FAR 7.105(b) (16), when developing acquisition plans, we are required to discuss all applicable environmental and energy conservation objectives associated with the acquisition.

For additional information on Executive Order 13101, see the DoD Green Procurement Program.

Components - Acquisition Background and Objectives
Statements of Need - You should be able to write this narrative (or obtain the customer's narrative from existing documentation) from your initial meetings to develop a relationship with your customer.

Applicable conditions - The information required to draft this paragraph comes from your assessment of the business environment, existing documentation, and other conditions identified by other members of the acquisition team. This paragraph can be written before receipt of the purchase request.

Cost - You might have become familiar with your customer's budget and overall affordability concerns, but you should tackle this paragraph after you have received the purchase request. This is true for delivery or performance-period requirements, trade-offs, risks, and acquisition streamlining.

Capability or performance - Specify the required capabilities or performance characteristics of the supplies or the performance standards of the services being acquired and state how they are related to the need.

Even though much of the information required to complete your acquisition plan cannot be determined or confirmed until a firm requirement is identified, many of the topic areas can be completed, or at least some of the information is available, or can be assumed for the purpose of planning. Like every other formatted report you have probably dealt with in the past, the hardest part is determining where to find the information that is being asked for. In this case, however, that's the good part. Based on your knowledge of your customer's needs, market research, business environment, and general contracting fundamentals, you should be well equipped to fill out certain sections of your acquisition plan. Let's take a look at the top level acquisition plan categories and see where the information you've learned about can be applied, as well as which areas should be deferred until after you receive a purchase request.

Delivery or performance - period requirements - Describe the basis for establishing delivery or performance-period requirements.

Trade-offs - Discuss the expected consequences of tradeoffs among the various cost, capability or performance, and schedule goals.

Risks - Discuss technical, cost, and schedule risks and describe what efforts are planned or underway to reduce risk and the consequences of failure to achieve goals.

Acquisition streamlining - Discuss plans and procedures to encourage industry participation, and to tailor necessary and cost effective requirements

After your initial relationship-building meetings with your customer, you should be able to write the __________ for your written acquisition plan.

| | Applicable conditions | | | Delivery requirements | | | Logistics considerations | | | Statement of need |
You should be able to write the statement of need narrative from your initial meetings to develop a relationship with your customer.

Plan of Action *
Sources - You should be well equipped to knock out the better part of this paragraph with the information you gained from conducting your market research and your knowledge of required sources and socioeconomic programs. This paragraph can be written before receipt of the purchase request.

Competition - The same is true of this paragraph. This paragraph can be written before receipt of the purchase request.

Source-selection procedures - Refer to your information gained from your understanding of your customer's needs and priorities as well as our discussion on evaluation criteria to get started on this section * Acquisition considerations - You can certainly get the upper hand on many of these, such as contract type selection; use of multiyear contracting, options, or other special contracting methods performance-based contracting; small disadvantaged business concerns, 8(a) contractors, women-owned small business concerns, HUBZone small business concerns, veteran-owned small business concerns from your knowledge of socioeconomic concerns and different contract types.

Budgeting and funding - In addition to budgeting and funding, trade-offs and risks should be deferred until after the receipt of the purchase request.

Product or service descriptions

Priorities, allocations, and allotments

* Contractor versus Government performance - For a discussion of what should be discussed in these paragraphs read FAR Part 7.3 and FAR Part 7.5 respectively.

Inherently governmental functions

Management information requirements

Make or buy

Test and evaluation

Logistics considerations

Government-furnished property * Government-furnished information

Environmental and energy conservation objectives

Security considerations

Contract administration - This paragraph can be written before receipt of the purchase request.

Other considerations

Milestones for the acquisition cycle

Identification of participants in acquisition plan preparation

Additional Documentation
There are additional documentation requirements related to major systems acquisition and bundling requirements.

These topics are covered in the following FARs and DFARs: * FAR 7.106 * FAR 7.107 * FAR 7.108 * DFARS 207.106

Which of the following sections of the acquisition plan can you write before you have the purchase request (PR)?

| | Cost, tradeoffs, product descriptions, and security considerations | | | Risks, acquisition streamlining, test and evaluation, and milestones | | | Applicable conditions, sources, competition, and contract administration | | | Budgeting and funding, priorities, Government-furnished property and information |
You will be able to draft the sections about applicable conditions, sources, competition, and contract administration before you receive the purchase request (PR).

Relevance and the Big Picture
All procurements, certainly all major acquisitions, are predicated on an Acquisition Plan that documents major decisions that have been made about the program and provides guidance for the acquisition team throughout the procurement. You, as a business advisor and a key member of the acquisition team, will be expected to be an active participant of the Acquisition Planning Team, bringing to the table critical information that is required to support business strategy decisions.

The Big Picture
Acquisition planning begins as soon as a customer need is identified. The Acquisition Plan guides the overall conduct of the procurement. Acquisition Plans are periodically reviewed and adjusted to ensure that the Government is meeting its needs in the most effective, economical, and timely manner possible
Your acquisition plan should document major program __________ and provide __________ for you and your acquisition team during the procurement.

| | Decisions, guidance | | | Vendors, priorities | | | Sources, agendas | | | Value, milestones |

An acquisition plan documents major decisions made about the program and provides guidance for your acquisition team for the overall conduct of the procurement.

As soon as you identify a customer __________, your acquisition planning begins.

| | Source | | | Need | | | Budget | | | Product |
Acquisition planning begins as soon as you identify a customer need.

Elements of Source Selection Planning
Source Selection Plan Definition
The source selection plan (SSP) describes in detail the plan for the conduct of the entire source selection process.
The SSP and the solicitation must adhere to the acquisition strategy and contract methodology documented in the approved acquisition plan. For high-dollar value and other acquisitions, as prescribed by agency procedures, the source selection authority (SSA) shall approve a source selection plan before the solicitation is issued.

Procedures at PGI 215.303(b)(2), (PGI 215.303 Responsibilities, or PGI viewer mode) show a source selection plan.

For further information and guidance regarding source selection, refer the letter dated 4 March 2011 from the Director, Defense Procurement and Acquisition Policy.

Overall Responsibility
The program manager (PM) has the overall responsibility for the preparation of the SSP.

PM Assistants
The source selection evaluation board (SSEB) Chairperson, Procuring Contracting Officer (PCO), and Legal Advisor assist the PM in the preparation and review of the SSP.

After final review and approval by the PCO and legal advisor, members of the source selection advisory council (SSAC) review and sign the plan indicating concurrence.

Final Approval
The chairperson of the SSAC then submits the plan to the SSA for approval. The SSP must be approved by the SSA prior to issuing the formal solicitation

Formal solicitation issued, now what?
After issuance of the solicitation, the evaluation factors for award, and their relative importance, reflected in the SSP cannot be changed without formal amendment to the solicitation and SSP

You put together a great source selection plan (SSP); it was approved, and you have issued the solicitation. Some unexpected industry changes occurred that would affect the evaluation factors for the award. What action should you take?

| | Take no action and evaluate the proposals using the new information | | | Send a letter explaining the change to only the top three agencies competing for the contract | | | Post a notice on the Government solicitations and awards website FedBizOpps | | | Issue a formal amendment to the source selection plan (SSP) and solicitationAfter issuing the solicitation, the evaluation factors for award reflected in the source selection plan (SSP) cannot be changed without formal amendment to the solicitation and source selection plan (SSP). |

Background, Objectives, and Acquisition

Background and Objectives
Include a brief description of the requirement, a summary of the objectives, and any reference to applicable guidance.

Acquisition Strategy
Provide a summary of the planned acquisition approach to include a description of how the specific acquisition being competed fits into the entire program.

Source Selection Team

Describe the organizational structure and identify the various roles and responsibilities of each of the source selection teams during the phases of the source selection.

Some roles are: * Source selection evaluation team (SSET) * Source selection advisory council (SSAC) * Procuring contracting officer (PCO) * Source selection authority (SSA) (See PGI 215.303)
Describe the process and controls for communication with industry as well as internal Government team communication. The process and controls include the use of e-mail during the source selection and an outline of the security measures that will be used to ensure the information is protected as source selection information.

Review FAR 3.104 for more information

Evaluation Factors and Subfactors
Identify the following items in the SSP: * Evaluation factors and subfactors and their relative order of importance * The importance of all non-cost or price factors to the cost or price factor * The evaluation process including specific procedures and techniques to be used in evaluating proposals
Include the relevant and most current portions of Sections L and M in the RFP (or a non-UCF solicitation) to preclude inconsistencies between the SSP and RFP.

The Combined Technical and Risk Ratings Table provides you with a sample of the evaluation matrix used when technical and risk are combined.

The letter also provides specific direction on evaluation criteria and procedure regarding past performance, cost/price.

The Relation of Documents to Evaluation Table provides you with an example of the relationship of acquisition documents to evaluation factors and subfactors. It includes the work breakdown structure (WBS), the specification and performance work statement (PWS), the evaluation factors, subfactors, and submission information.

The Evaluation of Cost/Price Table provides you with a representative description of how cost/price may be evaluated.

In your source selection plan (SSP), you carefully lay out the security measures to protect the source selection information and prevent any disclosure that would jeopardize the successful completion of the procurement. Which section of the source selection plan (SSP) contains these security measures?

| | Acquisition strategy | | | Background and objectives | | | Communications | | | Documentation |
The communications section outlines the security measures that will be used to ensure the information is protected as source selection information.

When you are attempting to evaluate many factors in a proposal, what would assist you to look quickly at several elements at one time?

| | An evaluation matrix | | | A printout of FAR 15.2 | | | A copy of Sections L and M in the RFP | | | A list of scheduled milestones |
An evaluation matrix will help you compare various elements of the proposal quickly, especially in the case of technical evaluations where tradeoffs are performed. Using color in your matrix may also assist in your evaluation

Additional Contents of the Source Selection Plan
There are several more items that you must consider and include with the source selection plan. They include: * Documentation * Schedule of Events * Non-Governmental Personnel * Source Materials

It is also important to remember to add small business participation and past performance information in the source selection plan.

For additional information and guidance regarding source selection, refer the letter dated 4 March 2011 from the Director, Defense Procurement and Acquisition Policy


Identify the types of documents that will be prepared during the course of the source selection, to include at a minimum: * SSEB report covering the initial evaluation * Final SSEB report after receipt of Final Proposal Revisions * SSAC report, if there is an SSAC * Source selection decision document (SSDD) that reflects the SSA's independent determination. A power point presentation is acceptable to use to brief the SSA and the SSAC on the status of the procurement but should not, as a general rule, constitute the official reports required for the source selection.
Schedule of Events

List the major acquisition activities and projected completion dates
Non-Government Personnel

You should address the use of non-Government personnel in the evaluation process.
Source Materials

Detail the plan for securing all source selection materials throughout the evaluation process

What documents might you prepare during source selection? Select all that apply.

| | SSAC report | | | Source Selection Decision document | | | Initial SSEB report | | | Final SSEB report | | | SSIC Report |
At a minimum, you would prepare an initial and final SSEB report, an SSAC report, and a source selection decision document (SSID).

Criteria for Developing an Acquisition Strategy

Determining Criteria used in Developing an Acquisition Strategy
While determining the criteria used to develop an acquisition strategy, there are several key points to keep in mind.

Let's step through an exercise in which you determine key points of the following criteria: * Contents of a written acquisition plan * Relevant areas from the source selection plan
Contents of a Written Acquisition Plan
Writing your acquisition plan occurs when you coordinate and integrate the efforts of all the people on your acquisition team into a comprehensive plan that will fulfill the agency's need quickly and at a reasonable cost. It includes the overall strategy for managing the acquisition.

FAR Part 7 defines and describes acquisition plans. Familiarize yourself the following sections, now, to help you prepare to practice writing an acquisition plan: * FAR 7.105, Contents of Written Acquisition Plans * FAR 7.105 (a) Acquisition Background and Objectives * FAR 7.105 (b) Plan of Action

As the contracting officer (CO) on this project, James established a preliminary draft acquisition plan using the guidance in FAR 7.1. This guidance gave James his road map to conduct the acquisition.

Through his market research, James believes he understands the marketplace for the items he must buy to meet the basic requirement of having the 38th Security Detachment operational in Building 55 by October 1.

James approached this entire procurement from the best value concept. During this planning phase of the project, he strived to develop an expected outcome that will satisfy the 38th Security Detachment. James believes that his total approach and decisions to date will provide the greatest overall benefit in response to the requirements. The proof will come during, and at the end of, the acquisition phase when the 38th Security Detachment becomes operational.

James, Lt. Appleton, the IPT technical expert for the contract, the small business specialist, and the competition advocate prepared an acquisition business case to consider all the regulatory and statutory influences that must be considered for each procurement. The plan also included the actions necessary during the planning phase, the acquisition phase, and the contract management phase of each contract. The importance of this part of the process is that the entire team was involved because, if you recall, acquisition planning is a method of coordinating the efforts of everyone responsible for the acquisition.

The Chief Contracting Officer gave James direction to manage all the pieces of this acquisition using the procedures in FAR 7.1 Acquisition planning and the requirements for those plans in FAR 7.105 and DFARS 207.105. Other IPT members can do much of the analysis and documentation, but James is responsible for ensuring that the analysis provides for best-value decision making. The resulting documentation will be a true picture of the actions taken to arrive at the specific decisions.

James will also need to develop a source selection plan for the IT service contract by applying FAR Part 15.
Which answer best represents the 38th Security Detachment's role in creating the acquisition strategy?

| | The contracting officer | | | The project manager and contracting officer | | | The small business specialist and the customer | | | The team responsible for the acquisition |
The team from the 38th Security Detachment is responsible for the acquisition.

Which section of the FAR specifies the contents of a written acquisition plan?

| | FAR 7.105 | | | FAR 7.204 | | | FAR 7.303 | | | FAR 7.404 |

Which section of the FAR will James consult if he is determining the importance of the source selection paragraph of his acquisition strategy?

| | FAR 7.104 (b) | | | FAR 7.105 (a) | | | FAR 7.105 (b) | | | FAR 7.106 (a) |
James will consult FAR 7.105(b) if he is determining the importance of the source selection part of his acquisition strategy.

When James and Lt. Appleton consider their acquisition strategy for the purchase of office supplies, which of the following FAR subparts should they review?

| | 7.1 | | | 7.2 | | | 7.3 | | | 7.4 |
When James and Lt. Appleton consider their acquisition strategy for office supplies, they should review FAR 7.2.

Determine which of the following criteria are important in developing an acquisition strategy. Select all that apply.

| | Keep best value in mind | | | Involve the whole team | | | Consult the FAR Part 7 | | | Consider the type of acquisition | | | Conduct market researchThe following criteria are important in developing an acquisition strategy: * Keep best value in mind * Involve the whole team * Consult the FAR Part 7 * Consider the type of acquisition * Conduct market research |

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