***
***
*** RSSing Note: Article removed by member request. ***
***
***
*** RSSing Note: Article removed by member request. ***
***
↧
--- Article Removed ---
↧
--- Article Removed ---
***
***
*** RSSing Note: Article removed by member request. ***
***
***
*** RSSing Note: Article removed by member request. ***
***
↧
↧
Is contracting an intellectual pursuit? Are contracting officers intellectuals?
What follows is the text of a speech I gave on January 13, 2011, at the Conference for Journeymen held by the Air Force Space Command, Space and Missile Systems Center, the organization with which I started my career in 1974, when it was the Space and Missile Systems Organization (SAMSO) of the Air Force Systems Command. Several people have suggested that I...
↧
Experiments in Service Contracting?
Show of hands: How many of you think that the government can reduce costs under cost-reimbursement service contracts by tripling the number of government personnel involved in contract administration?
Steven Kelman, Harvard professor and former OFPP administrator (and the best one we?ve ever had), has proposed an ?experiment? to do just that in the...
Steven Kelman, Harvard professor and former OFPP administrator (and the best one we?ve ever had), has proposed an ?experiment? to do just that in the...
↧
An agenda for the new OFPP Administrator
We have a new Office of Federal Procurement Policy (OFPP) Administrator, The Honorable Joseph Jordan.
Most OFPP Administrators served about two years and didn’t do anything that had much of a lasting remedial effect on a system with which no one is very happy. Appointees have had a variety of qualifications. If I remember rightly, only two...
Most OFPP Administrators served about two years and didn’t do anything that had much of a lasting remedial effect on a system with which no one is very happy. Appointees have had a variety of qualifications. If I remember rightly, only two...
↧
↧
Policy will not fix acquisition.
A Minor League Kerfluffle
Steve Kelman and I have been involved in a minor league kerfluffle over a comment I made in response to a blog post he wrote entitled, “A new way to use past performance in contracting.” He proposed a new contracting incentive. Here is how he described it:
Here’s my proposal: if a...
Steve Kelman and I have been involved in a minor league kerfluffle over a comment I made in response to a blog post he wrote entitled, “A new way to use past performance in contracting.” He proposed a new contracting incentive. Here is how he described it:
Here’s my proposal: if a...
↧
Enough, already!
I’m going to show some self-restraint here and not say that I hate Congress.
This morning’s Government Executive email reported that some representative from Florida on the House Transportation and Infrastructure Committee "spoke out" about GSA bonuses and conference spending -- “GSA hammered...
This morning’s Government Executive email reported that some representative from Florida on the House Transportation and Infrastructure Committee "spoke out" about GSA bonuses and conference spending -- “GSA hammered...
↧
A Master of Science Degree in Government Contracting?
The George Washington University has announced a program for a Master of Science in Government Contracting. http://business.gwu.edu/msgc/program/. I knew this program was in the works, and it is a good thing, but the curriculum is a disappointment. Here it...
↧
REAs and Claims: Is There A Difference?
Despite the plain language of the FAR definition of claim and an overwhelming amount of case law, many contracting practitioners falsely believe that claims and requests for equitable adjustment (REA) under a contract clause are categorically different, that a contractor must submit an REA before it can submit a claim, and that there can’t be...
↧
↧
Can a CO update the clauses in an existing contract when the FAR changes or when exercising options?
Two of my students, who work for a very large government contractor, told me that the contracting officers (COs) who administer their contracts unilaterally update contract clauses from time to time when they add funds to the contract or when they exercise options. They wondered if that was okay.
More than a few people believe that the government must...
More than a few people believe that the government must...
↧
Experiments in Service Contracting?
Show of hands: How many of you think that the government can reduce costs under cost-reimbursement service contracts by tripling the number of government personnel involved in contract administration?
Steven Kelman, Harvard professor and former OFPP administrator (and the best one we?ve ever had), has proposed an ?experiment? to do just that in the February 14, 2011 print edition of Federal Computer Week, page 15. Read it here: http://fcw.com/articles/2011/02/14/comment...management.aspx. (If the link doesn't work, copy it and paste it into your browser.)
Prof. Kelman begins his commentary by pointing out that the government spends a lot on services every year and that service contract cost savings would contribute a great deal to deficit reduction. Agreed. He then says: ?We all know anecdotally about unnecessary work performed under service contracts and insufficient cost controls? .? Well, yes, I have heard that, and I believe it?s true to some extent, although I cannot say to what extent. He then makes an analogy between cutting service costs and house-to-house fighting in war. (An unfortunate analogy, but I?ll let that go.) He then says:
So he wants a surge. He then says:
He then proposes an experiment: (a) choose 20 cost-reimbursement contracts for ongoing services worth $5 to $10 million each, (b) double or triple (or maybe quadruple) the number of contract management personnel current assigned to each of them, ( c) track them for two years and then (d) compare the costs with 20 similar contracts that do not receive additional personnel.
Steve acknowledges that the details of the experiment would have to be worked out.
I have strong ideas about services and service contracting. I have explained them in a number of articles published since the late 1990s, many of them are available only to subscribers to Westlaw. But Ralph Nash and I wrote an article for the September 2007 issue of Defense Acquisition Review Journal in which my ideas are briefly described. That article is accessible here: http://www.dau.mil/pubscats/PubsCats/ARJ45_Edwards.pdf. Three of my thoughts are summarized in the following three passages from that article:
Now, with those passages in mind, here is what I think about Steve?s idea: While I love experiments, I would distrust results produced by any such as he describes. Why?
First, because it would be virtually impossible to establish a valid control group of 20 ?mirror? services, due to (a) differences in the conduct of competitions for contract award, (b) differences in the events and the circumstances of performance, and ( c) differences in the management styles of the government personnel involved. Every contract for long-term complex services is somewhat unique and not entirely comparable to others. Even a contract for a given service at a given location might not mirror its predecessor contract.
Second, without a valid control group to serve as bases for comparisons, it would be impossible to reliably measure savings and quality differences. Moreover, applying the experiment to cost-reimbursement contracts is problematical, because the use of a cost-reimbursement contract suggests that there is significant uncertainty with respect to cost outcomes. A cost underrun (which is unlikely in any event) could be due to savings or to estimating error. On the other hand, an overrun might reflect savings from what the costs more accurately otherwise would have been. Failure to underrun, or an overrun, might reflect a decision by the agency to use all of the funds available to it for the contract in the fiscal year.
Third, such experiments in acquisition are almost always political events, more akin to gimmicks than exercises in the scientific method. In my experience, the people who conduct them often are not trying to test a hypothesis, but trying to prove that their hypothesis is right. Thus, the tendency is to conduct the ?experiment? and then declare it a ?success? in the sense that it confirms an idea that supports a preferred course of action. Then all sorts of gurus and consultants jump on the bandwagon touting the rightness of the idea.
Performance-based contracting is a classic illustration. Something like Steve?s new idea was tried in the mid-1990s with performance-based contracting. See 59 FR 26679-01, May 23, 1994:
In May 1998, OFPP published a report of the results of the project, available here: https://www.acquisition.gov/sevensteps/libr...on-the-perf.pdf. The results are summarized nicely in the October 1998, ?final edition? of OFPP?s Guide to Best Practices for Performance-Based Services Contracting:
The Guide is available at http://georgewbush-whitehouse.archives.gov...c.html#chapter1.
The report itself concluded:
It would be an understatement to say that the "report" did not back up its claims with hard data about specific contracts or offer to provide such hard data upon request. Thus, it was impossible to independently verify the claims. As far as I?m concerned, unverifiable claims for the results of pilot projects, or experiments, are just that. To put it nicely, they are hooey. The confirmation of OFPP?s ?hypothesis? was a foregone conclusion and about as scientifically valid as professional wrestling and roller derby, which are at least fun to watch.
?Pilot project,? ?experiment,? it?s all the same.
That is not to say that increasing contract management staffing would not produce good results. Let?s consider: What would be the likely effect on cost and quality of putting more government personnel to work managing cost-reimbursement service contracts.
On the one hand, greater monitoring might detect more instances of subpar performance, which might lead to prompt corrective action and better outcomes. It might facilitate better communication between the government and its contractor. With more eyes on the contractor, the government may be better able to spot inefficient practices and performance shortfalls in progress. If we assume that to be true, then adding people would be beneficial.
But, on the other hand, adding government personnel might increase costs if the they try to squeeze more work out of the contractor or slip in unplanned requirements. It might increase costs without much to show for it if they are persnickety and demand reperformance or other corrective action in each and every instance of customer dissatisfaction, however minor or inconsequential the quality shortfall. Such a management approach will likely reduce customer satisfaction in the long run and make the government-contractor relationship more tense and disfunctional. No compromise, no savings, and a bigger bill without much real improvement.
Yet, on the other hand, if the management approach is to be helpful and cooperative, rather than merely corrective and demanding, good things could happen: cost inefficiencies might be detected and efficiencies might be found, and customer satisfaction might be improved.
Here?s a hypothesis of my own: While the government needs enough people to properly monitor performance, the quality of the government personnel, not the number, is the most important factor in the government?s contribution to performance. In other words, one wise and effective contracting officer's technical representative is better than two or three nitpicking nuisances. How can we test that hypothesis? I don?t know. Like I said, experiments in government contracting are dubious affairs.
But why test it? Why not just accept several decades of management thinking and assume that (a) the government needs the right number of people for the job, which depends on consideration of several factors ⎯ number of functions and tasks, number of performance locations, number of contractor personnel, etc. ⎯ and should not be determined by gross doubling or tripling of the current number; (b) they have to be the right kind of people ⎯ wise, competent, good communicators and capable negotiators; and ( c) they have to have the right kind of contractor to work with ⎯ honest. cooperative, capable, and seeking to please.
But some government managers like demonstrations of ?success,? and so somebody is likely going to want to conduct Steve?s ?experiment.? And why not, if it can lead to getting more personnel? After all, the time honored government management approach, when you don?t know what else to do, is to throw people at the problem and hang on to them until the next round of budget cuts. And whatever else you do, declare success.
I frankly cannot see the point in this kind of thing, which strikes me as gimmicky, as is so much of acquisition management, with its experiments, pilots, and initiatives. We have done those kinds of things many times and I don't see that they have gotten us to where we need to be. What we need to do instead is the hard work of determining, on a case by case basis, the number and kind of people that we need for each contract, how we're going to get them, and from where. It is likely that we will never have enough people, which makes it all the more important that we have the right kind of people. Where do we find them? How do we prepare them for the task?
Steven Kelman, Harvard professor and former OFPP administrator (and the best one we?ve ever had), has proposed an ?experiment? to do just that in the February 14, 2011 print edition of Federal Computer Week, page 15. Read it here: http://fcw.com/articles/2011/02/14/comment...management.aspx. (If the link doesn't work, copy it and paste it into your browser.)
Prof. Kelman begins his commentary by pointing out that the government spends a lot on services every year and that service contract cost savings would contribute a great deal to deficit reduction. Agreed. He then says: ?We all know anecdotally about unnecessary work performed under service contracts and insufficient cost controls? .? Well, yes, I have heard that, and I believe it?s true to some extent, although I cannot say to what extent. He then makes an analogy between cutting service costs and house-to-house fighting in war. (An unfortunate analogy, but I?ll let that go.) He then says:
QUOTE
To help us make progress on that house-to-house fighting, I propose that we provide more resources to the people doing the fighting ⎯ the contracting officers and program officials who manage the contracts.
So he wants a surge. He then says:
QUOTE
Many contracting professionals believe that providing more contract management employees can pay for itself ⎯ perhaps many times over ⎯ in cost savings and, ideally, performance improvement. I am inclined to agree, but nobody knows whether than assumption is correct.
He then proposes an experiment: (a) choose 20 cost-reimbursement contracts for ongoing services worth $5 to $10 million each, (b) double or triple (or maybe quadruple) the number of contract management personnel current assigned to each of them, ( c) track them for two years and then (d) compare the costs with 20 similar contracts that do not receive additional personnel.
QUOTE
If costs go down and/or performance goes up on the contracts receiving additional resources, we should use that approach more broadly in the future.
Steve acknowledges that the details of the experiment would have to be worked out.
I have strong ideas about services and service contracting. I have explained them in a number of articles published since the late 1990s, many of them are available only to subscribers to Westlaw. But Ralph Nash and I wrote an article for the September 2007 issue of Defense Acquisition Review Journal in which my ideas are briefly described. That article is accessible here: http://www.dau.mil/pubscats/PubsCats/ARJ45_Edwards.pdf. Three of my thoughts are summarized in the following three passages from that article:
QUOTE
This article proposes that there are two categories of services, and that PBSA as it is known at the beginning of 2007 works for one, but not the other. The first category includes many common, routine, and relatively simple services that can be acquired through PBSA as it is currently defined, including many housekeeping services, simple equipment maintenance and repair services, and the like. The second category includes services that are too long-term and complex to permit complete specification of results and competitive pricing at the outset of contracting. These include many long-term information technology services, services to operate government-owned facilities, and long-term and multifunction or multitask professional, administrative, and management support services. These are the services for which the government spends the most money.
* * *
In real life, parties to long-term and complex service contracts do not specify all requirements at the time of contract award in clear, specific, objective, and measurable terms. Instead, they engage in ad hoc decision making in response to emerging and changing requirements, shifting priorities, and unexpected circumstances. They make it up as they go along, developing and adjusting expectations and agreements accordingly. Reality is never the same as expectations and projections, and plans and agreements go awry. No matter how long and hard future needs are considered, contracts will include things that will not be needed and leave out things that will be. Specifications and expectations must be adjusted over the course of time.* * *
Unlike most supply purchases, long-term service contracts entail close human relationships that enable the parties to deal with dynamic complexity and respond to emerging and changing needs and circumstances. Relationships are crucial, and it is well established in service marketing literature that subjective customer satisfaction is as important, and sometimes more important, than technical success. [Footnotes omitted.]Now, with those passages in mind, here is what I think about Steve?s idea: While I love experiments, I would distrust results produced by any such as he describes. Why?
First, because it would be virtually impossible to establish a valid control group of 20 ?mirror? services, due to (a) differences in the conduct of competitions for contract award, (b) differences in the events and the circumstances of performance, and ( c) differences in the management styles of the government personnel involved. Every contract for long-term complex services is somewhat unique and not entirely comparable to others. Even a contract for a given service at a given location might not mirror its predecessor contract.
Second, without a valid control group to serve as bases for comparisons, it would be impossible to reliably measure savings and quality differences. Moreover, applying the experiment to cost-reimbursement contracts is problematical, because the use of a cost-reimbursement contract suggests that there is significant uncertainty with respect to cost outcomes. A cost underrun (which is unlikely in any event) could be due to savings or to estimating error. On the other hand, an overrun might reflect savings from what the costs more accurately otherwise would have been. Failure to underrun, or an overrun, might reflect a decision by the agency to use all of the funds available to it for the contract in the fiscal year.
Third, such experiments in acquisition are almost always political events, more akin to gimmicks than exercises in the scientific method. In my experience, the people who conduct them often are not trying to test a hypothesis, but trying to prove that their hypothesis is right. Thus, the tendency is to conduct the ?experiment? and then declare it a ?success? in the sense that it confirms an idea that supports a preferred course of action. Then all sorts of gurus and consultants jump on the bandwagon touting the rightness of the idea.
Performance-based contracting is a classic illustration. Something like Steve?s new idea was tried in the mid-1990s with performance-based contracting. See 59 FR 26679-01, May 23, 1994:
QUOTE
To stimulate the government's conversion to performance-based service contracting, OFPP has developed a government-wide pilot project which relies on voluntary pledges by individual agencies to convert specified contracts for services to performance-based contracting methods. Agencies will be encouraged to limit their pledged contracts to recurring requirements to facilitate before and after measurement and assessment of results. Agencies will also be asked to consider breaking up large level-of-effort umbrella contracts in order to increase competition and convert to completion-type contracts where possible, thereby generating more innovation and cost effective proposals.
Agency pledges are also expected to include:
Endorsement of the project by the agency head; establishment of a high-level agency task force to oversee the effort; agreement to share lessons learned and best practices with other agencies; and measurement of the results of the project using predetermined project measurement criteria. The proposed project measurement criteria are: contract price; level of competition; number of contract audits; customer (project officer) satisfaction; length of procurement cycle; and small business participation.
Agency pledges are also expected to include:
Endorsement of the project by the agency head; establishment of a high-level agency task force to oversee the effort; agreement to share lessons learned and best practices with other agencies; and measurement of the results of the project using predetermined project measurement criteria. The proposed project measurement criteria are: contract price; level of competition; number of contract audits; customer (project officer) satisfaction; length of procurement cycle; and small business participation.
In May 1998, OFPP published a report of the results of the project, available here: https://www.acquisition.gov/sevensteps/libr...on-the-perf.pdf. The results are summarized nicely in the October 1998, ?final edition? of OFPP?s Guide to Best Practices for Performance-Based Services Contracting:
QUOTE
As a result of the pledge, 15 agencies converted 26 contracts with an estimated value of $585 million to performance-based methods. The agencies reported an average 15 percent reduction in contract price in nominal dollars, and an 18 percent improvement in satisfaction with the contractors? work. Moreover, reduced prices and increased customer satisfaction occurred at all price ranges, for both nontechnical and professional and technical services, and whether the contract remained fixed-price or was converted from cost reimbursement to fixed-price.
The Guide is available at http://georgewbush-whitehouse.archives.gov...c.html#chapter1.
The report itself concluded:
QUOTE
The results of the project strongly support the hypothesis that PBSC, when fully and properly applied, enables agencies simultaneously to obtain improved performance and reduced prices. PBSC is appropriate for professional and technical services as well as non-technical services, and for large, complex contracts as well as small contracts. Moreover, PBSC?s benefits are amplified when awarded using fixed price contracts.
It would be an understatement to say that the "report" did not back up its claims with hard data about specific contracts or offer to provide such hard data upon request. Thus, it was impossible to independently verify the claims. As far as I?m concerned, unverifiable claims for the results of pilot projects, or experiments, are just that. To put it nicely, they are hooey. The confirmation of OFPP?s ?hypothesis? was a foregone conclusion and about as scientifically valid as professional wrestling and roller derby, which are at least fun to watch.
?Pilot project,? ?experiment,? it?s all the same.
That is not to say that increasing contract management staffing would not produce good results. Let?s consider: What would be the likely effect on cost and quality of putting more government personnel to work managing cost-reimbursement service contracts.
On the one hand, greater monitoring might detect more instances of subpar performance, which might lead to prompt corrective action and better outcomes. It might facilitate better communication between the government and its contractor. With more eyes on the contractor, the government may be better able to spot inefficient practices and performance shortfalls in progress. If we assume that to be true, then adding people would be beneficial.
But, on the other hand, adding government personnel might increase costs if the they try to squeeze more work out of the contractor or slip in unplanned requirements. It might increase costs without much to show for it if they are persnickety and demand reperformance or other corrective action in each and every instance of customer dissatisfaction, however minor or inconsequential the quality shortfall. Such a management approach will likely reduce customer satisfaction in the long run and make the government-contractor relationship more tense and disfunctional. No compromise, no savings, and a bigger bill without much real improvement.
Yet, on the other hand, if the management approach is to be helpful and cooperative, rather than merely corrective and demanding, good things could happen: cost inefficiencies might be detected and efficiencies might be found, and customer satisfaction might be improved.
Here?s a hypothesis of my own: While the government needs enough people to properly monitor performance, the quality of the government personnel, not the number, is the most important factor in the government?s contribution to performance. In other words, one wise and effective contracting officer's technical representative is better than two or three nitpicking nuisances. How can we test that hypothesis? I don?t know. Like I said, experiments in government contracting are dubious affairs.
But why test it? Why not just accept several decades of management thinking and assume that (a) the government needs the right number of people for the job, which depends on consideration of several factors ⎯ number of functions and tasks, number of performance locations, number of contractor personnel, etc. ⎯ and should not be determined by gross doubling or tripling of the current number; (b) they have to be the right kind of people ⎯ wise, competent, good communicators and capable negotiators; and ( c) they have to have the right kind of contractor to work with ⎯ honest. cooperative, capable, and seeking to please.
But some government managers like demonstrations of ?success,? and so somebody is likely going to want to conduct Steve?s ?experiment.? And why not, if it can lead to getting more personnel? After all, the time honored government management approach, when you don?t know what else to do, is to throw people at the problem and hang on to them until the next round of budget cuts. And whatever else you do, declare success.
I frankly cannot see the point in this kind of thing, which strikes me as gimmicky, as is so much of acquisition management, with its experiments, pilots, and initiatives. We have done those kinds of things many times and I don't see that they have gotten us to where we need to be. What we need to do instead is the hard work of determining, on a case by case basis, the number and kind of people that we need for each contract, how we're going to get them, and from where. It is likely that we will never have enough people, which makes it all the more important that we have the right kind of people. Where do we find them? How do we prepare them for the task?
↧
An agenda for the new OFPP Administrator
We have a new Office of Federal Procurement Policy (OFPP) Administrator, The Honorable Joseph Jordan.
Most OFPP Administrators served about two years and didn’t do anything that had much of a lasting remedial effect on a system with which no one is very happy. Appointees have had a variety of qualifications. If I remember rightly, only two had ever worked in a contracting office doing contracting work.
OFPP’s job is to:
(2) promote economy, efficiency, and effectiveness in the procurement of property and services by the executive branch of the Federal Government.
41 U.S.C. 1101. (The statutory definition of “procurement” is substantially the same as the definition of “acquisition” in FAR 2.101.)
The Administrator’s job is to:
41 U.S.C. 1121. The statute says:
There is a long list of specific functions in 41 U.S.C. 1122. However, if you read the statute closely you will see that the Administrator’s powers, as opposed to his functions, appear to be limited. Two non-political appointee positions -- the Director of Defense Procurement and the Director of Defense Pricing – have more immediate and effective power, and the appointees usually stay in their jobs longer.
The new Administrator told the Senate during his confirmation hearings that his priorities are: (1) buying smarter, (2) building the right supplier relationships, (3) strengthening the acquisition workforce, and (4) remaining “mindful” of the relationship between Federal employees and contractors. He offered few specifics, which was probably appropriate at a Senate confirmation hearing. It is not immediately clear what he can and will actually do about any of those things other than to issue memos that few will read and fewer will remember two years from now. Nevertheless, what should he try to do?
In his blog for Federal Computer Week, http://fcw.com/Blogs...l-business.aspx, Steve Kelman suggested raising the micro-purchase threshold to $250,000 for limited purposes, in order to improve opportunities for “innovative” small businesses to get into the government market. That's right, the micro-purchase threshold. (Okay, stop cheering.) In what has to be the understatement of the week, he wrote: “There would be a few implementation issues that would have to be worked out.”
So what are my ideas about what the new Administrator should try to do? What things might he try to persuade Congress and agency managers to do? Well, choosing a few from a long list:
1. Restructure the contracting workforce to reflect the workload. Hire fewer contract specialists and more purchasing agents and procurement clerks, and create a new position: “acquisition data specialist” to do all that pesky data entry.
2. Establish a uniform standard of contracting officer selection, appointment, and appointment renewal. Set the standards high. We desperately need more competent people in that role. If we had more competent people we would not need so many laws and regulations.
3. Review and clarify small business law, policy, and programs and put the rules all in one place in the C.F.R. (and, yes, yes, increase opportunities for small businesses to get government contracts).
4. Change the protest system by either (preferably) eliminating the Court of Federal Claims as a protest forum or (second best) requiring protestors to choose one forum or the other and live with the result, prohibiting them from filing with the GAO and then going to the court if they lose.
5. Free the Department of the Defense from the phony “single, simplified, uniform” FAR System and allow it to publish its own acquisition regulation. Congress has written so many laws unique to DOD acquisition that it really has a separate system. The notion that we have a "single, simplified, uniform" system of acquisition regulation is absurd. Let's face facts. It would actually make life easier for everybody.
6. Remove FAR Subpart 8.4 and Part 13 from 48 CFR Chapter 1 (the FAR itself) and put them in separate chapters of their own. The idea is to give people conducting those kinds of acquisitions smaller regulations to cope with and to make it clear that they don’t have to worry about the rest of FAR and can simplify their processes.
7. Require GSA to establish a single source for the clauses in its Federal Supply Schedule contracts and to publish them in the Federal Register through the notice and public comment process. (A lot of GSA FSS COs have no idea where the clauses come from and cut and paste from old documents.)
8. Make the test program for commercial items (FAR Subpart 13.5) permanent.
That’s enough for one blog post. No point in getting carried away.
If Steve Kelman can propose raising the micro-purchase threshold to $250,000, why can’t I fantasize?
Most OFPP Administrators served about two years and didn’t do anything that had much of a lasting remedial effect on a system with which no one is very happy. Appointees have had a variety of qualifications. If I remember rightly, only two had ever worked in a contracting office doing contracting work.
OFPP’s job is to:
(1) provide overall direction of Government-wide procurement policies, regulations, procedures, and forms for executive agencies; and
(2) promote economy, efficiency, and effectiveness in the procurement of property and services by the executive branch of the Federal Government.
41 U.S.C. 1101. (The statutory definition of “procurement” is substantially the same as the definition of “acquisition” in FAR 2.101.)
The Administrator’s job is to:
provide overall direction of procurement policy and leadership in the development of procurement systems of the executive agencies.
41 U.S.C. 1121. The statute says:
To the extent that the Administrator considers appropriate in carrying out the policies and functions set forth in this division, and with due regard for applicable laws and the program activities of the executive agencies, the Administrator may prescribe Government-wide procurement policies. The policies shall be implemented in a single Government-wide procurement regulation called the Federal Acquisition Regulation.
There is a long list of specific functions in 41 U.S.C. 1122. However, if you read the statute closely you will see that the Administrator’s powers, as opposed to his functions, appear to be limited. Two non-political appointee positions -- the Director of Defense Procurement and the Director of Defense Pricing – have more immediate and effective power, and the appointees usually stay in their jobs longer.
The new Administrator told the Senate during his confirmation hearings that his priorities are: (1) buying smarter, (2) building the right supplier relationships, (3) strengthening the acquisition workforce, and (4) remaining “mindful” of the relationship between Federal employees and contractors. He offered few specifics, which was probably appropriate at a Senate confirmation hearing. It is not immediately clear what he can and will actually do about any of those things other than to issue memos that few will read and fewer will remember two years from now. Nevertheless, what should he try to do?
In his blog for Federal Computer Week, http://fcw.com/Blogs...l-business.aspx, Steve Kelman suggested raising the micro-purchase threshold to $250,000 for limited purposes, in order to improve opportunities for “innovative” small businesses to get into the government market. That's right, the micro-purchase threshold. (Okay, stop cheering.) In what has to be the understatement of the week, he wrote: “There would be a few implementation issues that would have to be worked out.”
So what are my ideas about what the new Administrator should try to do? What things might he try to persuade Congress and agency managers to do? Well, choosing a few from a long list:
1. Restructure the contracting workforce to reflect the workload. Hire fewer contract specialists and more purchasing agents and procurement clerks, and create a new position: “acquisition data specialist” to do all that pesky data entry.
2. Establish a uniform standard of contracting officer selection, appointment, and appointment renewal. Set the standards high. We desperately need more competent people in that role. If we had more competent people we would not need so many laws and regulations.
3. Review and clarify small business law, policy, and programs and put the rules all in one place in the C.F.R. (and, yes, yes, increase opportunities for small businesses to get government contracts).
4. Change the protest system by either (preferably) eliminating the Court of Federal Claims as a protest forum or (second best) requiring protestors to choose one forum or the other and live with the result, prohibiting them from filing with the GAO and then going to the court if they lose.
5. Free the Department of the Defense from the phony “single, simplified, uniform” FAR System and allow it to publish its own acquisition regulation. Congress has written so many laws unique to DOD acquisition that it really has a separate system. The notion that we have a "single, simplified, uniform" system of acquisition regulation is absurd. Let's face facts. It would actually make life easier for everybody.
6. Remove FAR Subpart 8.4 and Part 13 from 48 CFR Chapter 1 (the FAR itself) and put them in separate chapters of their own. The idea is to give people conducting those kinds of acquisitions smaller regulations to cope with and to make it clear that they don’t have to worry about the rest of FAR and can simplify their processes.
7. Require GSA to establish a single source for the clauses in its Federal Supply Schedule contracts and to publish them in the Federal Register through the notice and public comment process. (A lot of GSA FSS COs have no idea where the clauses come from and cut and paste from old documents.)
8. Make the test program for commercial items (FAR Subpart 13.5) permanent.
That’s enough for one blog post. No point in getting carried away.
If Steve Kelman can propose raising the micro-purchase threshold to $250,000, why can’t I fantasize?
↧
Policy will not fix acquisition.
A Minor League Kerfluffle
Steve Kelman and I have been involved in a minor league kerfluffle over a comment I made in response to a blog post he wrote entitled, “A new way to use past performance in contracting.” He proposed a new contracting incentive. Here is how he described it:
I commented, “I cannot tell you how awful I think the ‘fee’ return idea is. Truly awful.” I let it go at that. But feeling guilty about not explaining myself, I posted a detailed explanation in a later comment. You can read the whole thing here: http://fcw.com/Blogs...re-results.aspx.
Steve responded with a later blog post entitled, “A response to my critics,” later retitled, “How to think about new policy proposals -- feedback on my feedback.” He cited a “fascinating” paper by a Harvard Business School professor to insinuate that what he sees as my negativism is a way for me to feel better about myself. I responded by telling him that he seems to think that acquisition problems can be solved by new policies and procedural gimmicks, but that that the only way to fix deep seated problems in acquisition is to improve the workforce, and I tried to enlist him in that struggle. You can read that here: http://fcw.com/Blogs...m.aspx#Comments.
The Policy-Making Imperative
Here is the problem in acquisition today as I see it:
When someone is unhappy with something, for instance, if they think the government pays too much for goods and services, some official launches an “initiative” and issues a policy memorandum with a snappy title directing that acquisition personnel do things a certain way:
In short, the standard approach to problem solving is to issue policy and procedure directives. Sometimes the policy is called a policy innovation, or an innovative policy. (Innovate is second only to dream as America’s favorite magic word. If alien archeologists visit this planet after we’re gone and examine our surviving records, they will dub us the Dreaming Innovators. They will say that our civilization might have survived if we had spent less time dreaming and innovating and more time seeing reality and using our heads.)
Reactions To Policy
So what happens after a new policy is issued? First, the people in the field (or in the trenches, as some like to say, but really in the cubicles) roll their eyes and sigh. Then they start asking questions:
Some in the field, glad to see something new, anything new, get on board and design the innovative implementations of the policy maker’s dreams in the hope of recognition and maybe a silver hammer. Those are the Positivists. The Negativists write skeptical critiques or scathing condemnations, or simply foam at the mouth. Consultants set up shop and write slight “how to” pieces in trade and professional publications, hoping for new business. Some are dubbed “gurus” of the new policy and conduct pricey seminars devoid of details. The most ambitious write a book, or arrange for someone else to write it and then take author credit.
The Implementation
The policy makers set up a reporting scheme. Reporting is late and inaccurate. Ultimately, it is found that surveillance has been poor and implementation has been spotty. Congress holds hearings, complains about the spotty implementation, and enacts the new policy into law, apparently in the belief that everyone respects and fears them and will thus comply. Congress demands reports. Reports are late and inaccurate. The GAO finds that implementation of the law is spotty and ineffective or not as effective as it could be if everyone followed GAO’s recommendations.
Time passes. The policy maker moves on. The no-longer-new policy dims and may fade away entirely. It is ignored by the original policy maker’s successor, who wants her own initiative. It is mentioned no more at conferences. Seminars are offered no longer. Reporting continues, but no one really cares anymore. In time, some future official will launch an initiative that dotty old timers will say seems familiar. And then some crotchety paper hoarder will come in waving a copy of the original memo from a decade or two earlier, proving once again that there is no new thing under the sun.
The Great Game
Policy making is the great game in acquisition. We are being overwhelmed by laws, regulations, case law, policy memos, manuals, and handbooks. Policy making is the only power of the otherwise impotent. Senior officials, especially political (excuse me, I meant presidential) appointees, are touted as successes because they issued a couple of policy memos and attended a lot of meetings before moving on to better jobs on the strength of their newly padded resumes. They then write articles and make speeches about their policy memos and meetings and speak of things still to be done, even though they did not stay on to do them. The mere issuance of a policy memo is deemed a success, regardless of whether it is proven to be effective. If the policy maker is really bold, he or she will simply claim or imply success for the policy even in the absence of verifiable data. If they are modest at all they will claim limited success, which validates their theory, and say that it would have been more effective if implemented properly at the working level.
This has been going on for decades. The real way to improve acquisition is to improve the acquisition workforce -- really, seriously, improve it. But that would be hard and take time, and would be expensive. When most officials talk about improving the acquisition workforce they mean hiring more people. Oh, they will talk about improving the quality of the workforce, but they think that means ensuring that more people get to the official PowerPoint sessions ("training courses"). They have no idea what to do and how to do it. They don’t even have dreams. Innovation is putting the PowerPoint sessions online.
Reality Check
Acquisition works reasonably well if what you care about is that paper gets processed and stuff gets bought. Stuff does get bought. Whether we pay good prices and get good quality within a reasonable period of time is another matter. We often do and we often don’t. The vast majority of buys are for commodities and commodified services, and those go reasonably well, although there will always be something for the GAO and the IGs to complain about -- poor implementation or regulatory violations that, if fixed, might produce better results. As for the big stuff -- major defense systems and large information technology programs -- things are generally a mess, but they have been a mess pretty much throughout history. We know what the problems are, we just can’t fix them. We never will. We work in a cloud of mediocrity.
The Way To Real Improvement
In a complex system like acquisition, any attempt to fix deep seated system faults through policy will fail. The only way to get at the deep seated problems in acquisition is through workforce improvement, and I don’t mean numbers. We need well-educated, superbly trained people for the big stuff, and we do not have enough of them. Mismanagement and poor leadership will prompt many of the best of the new recruits to leave. The problems are beyond the reach of management in the organizational structure we have now for the simple reason that no one is in charge. Only someone with the power and the ruthlessness of a Stalin could fix the system. A few purges might be just the thing.
Here’s how to have a good career in contracting: First, study. Read a lot, read widely, and think about what you read. Next, find a contracting office to work for that does demanding work, like the Air Force Space and Missile Systems Center in El Segundo, California, which is doing really interesting work, is staffed by people of very high quality, and is very well led. Work, learn, and grow. If that is not enough, write articles and books. That will keep you busy. Ignore the rest, because you cannot do anything about it. Roll with the punches. Practice a wry smile.
I’ve heard that some call me the prophet of doom (or maybe it was gloom, I’m not sure). I’m not, really. I just do not rest my hopes on the system. I rest them on people, individuals. The only hope for our system is that committed individuals will never stop trying to be the best that they can be and to bring out the best in their colleagues. If enough individuals will do that, good things will happen. Try it. You’re going to like the way you feel.
Steve Kelman and I have been involved in a minor league kerfluffle over a comment I made in response to a blog post he wrote entitled, “A new way to use past performance in contracting.” He proposed a new contracting incentive. Here is how he described it:
Here’s my proposal: if a contractor, at the end of the contract where performance has met requirements, returns 3 percent of the fee on a fixed-price contract to the government customer (maybe make it 5 percent for a contract under $500,000), the contractor will automatically be given the highest-possible rating on the cost control element of the past performance evaluation, with an explanation in the evaluation of why the rating was received. With the increased attention these days to cost control, this may be a valuable incentive for contractors to return money (to which, it should be remembered, they are entitled to by the contract) to the government.
I commented, “I cannot tell you how awful I think the ‘fee’ return idea is. Truly awful.” I let it go at that. But feeling guilty about not explaining myself, I posted a detailed explanation in a later comment. You can read the whole thing here: http://fcw.com/Blogs...re-results.aspx.
Steve responded with a later blog post entitled, “A response to my critics,” later retitled, “How to think about new policy proposals -- feedback on my feedback.” He cited a “fascinating” paper by a Harvard Business School professor to insinuate that what he sees as my negativism is a way for me to feel better about myself. I responded by telling him that he seems to think that acquisition problems can be solved by new policies and procedural gimmicks, but that that the only way to fix deep seated problems in acquisition is to improve the workforce, and I tried to enlist him in that struggle. You can read that here: http://fcw.com/Blogs...m.aspx#Comments.
The Policy-Making Imperative
Here is the problem in acquisition today as I see it:
When someone is unhappy with something, for instance, if they think the government pays too much for goods and services, some official launches an “initiative” and issues a policy memorandum with a snappy title directing that acquisition personnel do things a certain way:
- From now on, write performance work statements.
- Negotiate fixed-price incentive contracts with a 50/50 share line and a 120 percent ceiling.
- Set negotiation objectives for service contracts at 2010 price levels.
- Definitize undefinitized contractual actions within 180 days.
In short, the standard approach to problem solving is to issue policy and procedure directives. Sometimes the policy is called a policy innovation, or an innovative policy. (Innovate is second only to dream as America’s favorite magic word. If alien archeologists visit this planet after we’re gone and examine our surviving records, they will dub us the Dreaming Innovators. They will say that our civilization might have survived if we had spent less time dreaming and innovating and more time seeing reality and using our heads.)
Reactions To Policy
So what happens after a new policy is issued? First, the people in the field (or in the trenches, as some like to say, but really in the cubicles) roll their eyes and sigh. Then they start asking questions:
- What do you mean, exactly?
- Do you mean this or do you mean that?
- Does the new policy apply to this or to that circumstance?
- Does the dollar threshold include options?
- What is the waiver procedure?
- Who can approve waivers?
- How long will it take to get a waiver?
- Are you going to delegate waiver authority?
- And, finally, the ultimate question: How do I do that?
Some in the field, glad to see something new, anything new, get on board and design the innovative implementations of the policy maker’s dreams in the hope of recognition and maybe a silver hammer. Those are the Positivists. The Negativists write skeptical critiques or scathing condemnations, or simply foam at the mouth. Consultants set up shop and write slight “how to” pieces in trade and professional publications, hoping for new business. Some are dubbed “gurus” of the new policy and conduct pricey seminars devoid of details. The most ambitious write a book, or arrange for someone else to write it and then take author credit.
The Implementation
The policy makers set up a reporting scheme. Reporting is late and inaccurate. Ultimately, it is found that surveillance has been poor and implementation has been spotty. Congress holds hearings, complains about the spotty implementation, and enacts the new policy into law, apparently in the belief that everyone respects and fears them and will thus comply. Congress demands reports. Reports are late and inaccurate. The GAO finds that implementation of the law is spotty and ineffective or not as effective as it could be if everyone followed GAO’s recommendations.
Time passes. The policy maker moves on. The no-longer-new policy dims and may fade away entirely. It is ignored by the original policy maker’s successor, who wants her own initiative. It is mentioned no more at conferences. Seminars are offered no longer. Reporting continues, but no one really cares anymore. In time, some future official will launch an initiative that dotty old timers will say seems familiar. And then some crotchety paper hoarder will come in waving a copy of the original memo from a decade or two earlier, proving once again that there is no new thing under the sun.
The Great Game
Policy making is the great game in acquisition. We are being overwhelmed by laws, regulations, case law, policy memos, manuals, and handbooks. Policy making is the only power of the otherwise impotent. Senior officials, especially political (excuse me, I meant presidential) appointees, are touted as successes because they issued a couple of policy memos and attended a lot of meetings before moving on to better jobs on the strength of their newly padded resumes. They then write articles and make speeches about their policy memos and meetings and speak of things still to be done, even though they did not stay on to do them. The mere issuance of a policy memo is deemed a success, regardless of whether it is proven to be effective. If the policy maker is really bold, he or she will simply claim or imply success for the policy even in the absence of verifiable data. If they are modest at all they will claim limited success, which validates their theory, and say that it would have been more effective if implemented properly at the working level.
This has been going on for decades. The real way to improve acquisition is to improve the acquisition workforce -- really, seriously, improve it. But that would be hard and take time, and would be expensive. When most officials talk about improving the acquisition workforce they mean hiring more people. Oh, they will talk about improving the quality of the workforce, but they think that means ensuring that more people get to the official PowerPoint sessions ("training courses"). They have no idea what to do and how to do it. They don’t even have dreams. Innovation is putting the PowerPoint sessions online.
Reality Check
Acquisition works reasonably well if what you care about is that paper gets processed and stuff gets bought. Stuff does get bought. Whether we pay good prices and get good quality within a reasonable period of time is another matter. We often do and we often don’t. The vast majority of buys are for commodities and commodified services, and those go reasonably well, although there will always be something for the GAO and the IGs to complain about -- poor implementation or regulatory violations that, if fixed, might produce better results. As for the big stuff -- major defense systems and large information technology programs -- things are generally a mess, but they have been a mess pretty much throughout history. We know what the problems are, we just can’t fix them. We never will. We work in a cloud of mediocrity.
The Way To Real Improvement
In a complex system like acquisition, any attempt to fix deep seated system faults through policy will fail. The only way to get at the deep seated problems in acquisition is through workforce improvement, and I don’t mean numbers. We need well-educated, superbly trained people for the big stuff, and we do not have enough of them. Mismanagement and poor leadership will prompt many of the best of the new recruits to leave. The problems are beyond the reach of management in the organizational structure we have now for the simple reason that no one is in charge. Only someone with the power and the ruthlessness of a Stalin could fix the system. A few purges might be just the thing.
Here’s how to have a good career in contracting: First, study. Read a lot, read widely, and think about what you read. Next, find a contracting office to work for that does demanding work, like the Air Force Space and Missile Systems Center in El Segundo, California, which is doing really interesting work, is staffed by people of very high quality, and is very well led. Work, learn, and grow. If that is not enough, write articles and books. That will keep you busy. Ignore the rest, because you cannot do anything about it. Roll with the punches. Practice a wry smile.
I’ve heard that some call me the prophet of doom (or maybe it was gloom, I’m not sure). I’m not, really. I just do not rest my hopes on the system. I rest them on people, individuals. The only hope for our system is that committed individuals will never stop trying to be the best that they can be and to bring out the best in their colleagues. If enough individuals will do that, good things will happen. Try it. You’re going to like the way you feel.
↧
↧
Enough, already!
I’m going to show some self-restraint here and not say that I hate Congress.
This morning’s Government Executive email reported that some representative from Florida on the House Transportation and Infrastructure Committee "spoke out" about GSA bonuses and conference spending -- “GSA hammered on outrageous bonuses, conference spending.” His complaints were based on reports by some TV station.
Enough. It is true that the agency was mismanaged in some ways for many years and wasted money. We have every right to be mad about that. We’ve gotten the news and the point. However, GSA does important work for the government and does it reasonably well given the amount of work that it does (which is not to say that it cannot do better). It makes no sense to destroy the agency through continued relentless attacks. The government needs GSA. Continued grandstanding about bonuses and conferences serves no good purpose and is not in the government’s best interests.
A new GSA Administrator has been appointed and seems to be working hard to fix things. He should be allowed to do his work without having the agency plowed under by grandstanding politicians who are obviously enjoying their brief days in the sun. There are thousands of decent, hardworking people at GSA who did their jobs and had nothing to do with creating bonus programs and setting up conferences, and there is no reason to utterly destroy whatever morale they may have left by piling on. Many of them are just starting out in their careers and might be forever turned off. Surely, given the state of transportation and infrastructure in this country, the House Committee on Transportation and Infrastructure has more important things to do.
GSA is not the only agency that has mismanaged the public’s money. Nextgov reported today that the Defense Department “quietly” shut down the Joint Tactical Radio System Program Office in San Diego, which reportedly spent $15 billion over 15 years without producing a workable product. The program has been transferred to the Army. If that report is correct, DOD "wasted" an average of one billion dollars per year for 15 years before someone decided that enough was enough. Who has been fired for that fiasco?
I have never before written this kind of blogpost. I don’t see myself as a white knight defender of government agencies and employees and have often been severely critical of them myself. But this thing about GSA has gotten to be just too much.
Presidents should be more careful about the political appointments they make. Investigations should continue until all of the mismanagement has been brought to light. Mismanagement culprits should be identified and fired if they aren't already gone. Criminals should be prosecuted. Right. But stop trashing GSA. Believe me, they are sorry about what happened.
Sorry for the outburst. (Not really.) OK, I've burned the soapbox.
This morning’s Government Executive email reported that some representative from Florida on the House Transportation and Infrastructure Committee "spoke out" about GSA bonuses and conference spending -- “GSA hammered on outrageous bonuses, conference spending.” His complaints were based on reports by some TV station.
Enough. It is true that the agency was mismanaged in some ways for many years and wasted money. We have every right to be mad about that. We’ve gotten the news and the point. However, GSA does important work for the government and does it reasonably well given the amount of work that it does (which is not to say that it cannot do better). It makes no sense to destroy the agency through continued relentless attacks. The government needs GSA. Continued grandstanding about bonuses and conferences serves no good purpose and is not in the government’s best interests.
A new GSA Administrator has been appointed and seems to be working hard to fix things. He should be allowed to do his work without having the agency plowed under by grandstanding politicians who are obviously enjoying their brief days in the sun. There are thousands of decent, hardworking people at GSA who did their jobs and had nothing to do with creating bonus programs and setting up conferences, and there is no reason to utterly destroy whatever morale they may have left by piling on. Many of them are just starting out in their careers and might be forever turned off. Surely, given the state of transportation and infrastructure in this country, the House Committee on Transportation and Infrastructure has more important things to do.
GSA is not the only agency that has mismanaged the public’s money. Nextgov reported today that the Defense Department “quietly” shut down the Joint Tactical Radio System Program Office in San Diego, which reportedly spent $15 billion over 15 years without producing a workable product. The program has been transferred to the Army. If that report is correct, DOD "wasted" an average of one billion dollars per year for 15 years before someone decided that enough was enough. Who has been fired for that fiasco?
I have never before written this kind of blogpost. I don’t see myself as a white knight defender of government agencies and employees and have often been severely critical of them myself. But this thing about GSA has gotten to be just too much.
Presidents should be more careful about the political appointments they make. Investigations should continue until all of the mismanagement has been brought to light. Mismanagement culprits should be identified and fired if they aren't already gone. Criminals should be prosecuted. Right. But stop trashing GSA. Believe me, they are sorry about what happened.
Sorry for the outburst. (Not really.) OK, I've burned the soapbox.
↧
A Master of Science Degree in Government Contracting?
The George Washington University has announced a program for a Master of Science in Government Contracting. http://business.gwu.edu/msgc/program/. I knew this program was in the works, and it is a good thing, but the curriculum is a disappointment. Here it is:
There is a link on the webpage to the course descriptions.
Basically, what they have done is slapped together some of their standard MBA courses with some of their standard law school courses and added a research and writing project. The problem is not what's there, but what's missing. (Although some of what's there is odd for a master of science in contracting.)
Where are the courses on professional practice? Look closely at the core curriculum. Except for a class in "marketing strategies," the management courses do not focus on government contracting. The focus comes in the law school courses.
Do you see any classes about requirements analysis and specification development (a topic heavily emphasized by the Services Acquisition Reform Panel)? No, probably because this master of science program is a joint venture of the management and law schools and they have no expertise in that topic. How about decision analysis for acquisition planning and source selection, contract strategy and structure, cost estimating methods, appropriations law, contingency contracting, international contracting and foreign military sales?
Why only two credit hours for government contract costs and pricing, one of the most important courses of all, when you probably need six credit hours (three for cost-based pricing and three for market based pricing)? Read the course description. The course is about the legal aspects of pricing, not the practical aspects. You're not going to learn how commercial firms price their products or services, or how costs are analyzed and established for major systems.
Defense spending dominates government contracting and defense programs are the government's largest and most controversial. Where is the class about major systems acquisition? Where is the class about the structure and performance of the defense industry? Where is the class about contracting in a monopsony market? Why only two credit hours for intellectual property (patents and data rights), an important and complex topic, especially in defense contracting. Information technology programs are the second most controversial in government contracting. Where is the class about that?
Why a course about financial accounting, but not about cost accounting (aka management accounting), which is of greater interest and concern to contracting practitioners?
Why no class about themes and fads in the history of government contracting? Why no class about the role of Congress in contracting policy development and management? What about contracting policy development process? What about the government program planning, budgeting, appropriation, and funds management processes? What about systems analysis and engineering? What about risk management? What about about competition theory and practice and negotiation theory and practice? What about contracting process design? What about about the politics and economics of socio-economics programs? What about the politics and economics of major systems acquisition? What about statutory and regulatory interpretation? How about a class in business writing for the contracting practitioner? And why not any focus on service contracting, which has been a dominant concern in government contracting for the past decade?
While I am all for advanced education, I'm not for degree bagging, even if the degree is from GWU, especially when the degree is expensive and based on a curriculum that does not reflect the needs of today's contracting practitioners. People considering the program ought to do some market research and find out what they would be paying for if they were admitted and ask themselves whether attendance would worth the price and a best value. Ask yourself: Will this degree get me promoted? Will it enable me to get enough additional salary to make the gain worth the cost?
Knowing how much we Americans love and respect credentials, I have no doubt that GWU will receive many applications, and that many tuitions will be paid by students and employers, including the government, especially DOD. (Military officers in the D.C. area who need at least one graduate degree to get promoted will line up.) I guess it's a start, but this isn't the program that we need, and I don't recommend it as it is. I want better education for contracting professionals, but not just any education. If learning is what interests you, you'd be better off just buying some books and reading them.
Core Business Curriculum (18 credit hours)
Government Contracts Curriculum - Required (8 credit hours)
- MBAd 6261 Organizations and Leadership (1.5 cr.)
- DNSC 6202 Mathematics and Statistics for Management (3.0 cr.)
- MBAd 6211 Financial Accounting (3.0 cr.)
- MBAd 6233 Financial Markets 1 (1.5 cr.)
- MBAd 6234 Financial Management 1 (1.5 cr.)
- MBAd 6242 Microeconomics for the World Economy (1.5 cr.)
- DNSC 6261 Introduction to Project and Program Management (3.0 cr.)
- Marketing Strategies for Federal Acquisition (3.0 cr.)
Government Contracts Curriculum - Selectives (6 credit hours)
- Law 6502 Formation of Government Contracts (3.0 cr.)
- Law 6503 Performance of Government Contracts (3.0 cr.)
- Law 6506 Government Contracts Cost and Pricing (2.0 cr.)
Capstone (4 credit hours)
- Law 6508 Comparative Public Procurement (3.0 cr.)
- Law 6512 Government Procurement of Intellectual Property Seminar (2.0 cr.)
- Law 6509-21 Government Contracts Seminar: Anti-Corruption in Procurement (3.0 cr.)
- Law 6509-10 Government Contracts Seminar: Public Values & Foreign Affairs Outsourcing (2.0 cr.)
- Government Contracts Capstone: Research and Writing Project (4.0 cr.)
There is a link on the webpage to the course descriptions.
Basically, what they have done is slapped together some of their standard MBA courses with some of their standard law school courses and added a research and writing project. The problem is not what's there, but what's missing. (Although some of what's there is odd for a master of science in contracting.)
Where are the courses on professional practice? Look closely at the core curriculum. Except for a class in "marketing strategies," the management courses do not focus on government contracting. The focus comes in the law school courses.
Do you see any classes about requirements analysis and specification development (a topic heavily emphasized by the Services Acquisition Reform Panel)? No, probably because this master of science program is a joint venture of the management and law schools and they have no expertise in that topic. How about decision analysis for acquisition planning and source selection, contract strategy and structure, cost estimating methods, appropriations law, contingency contracting, international contracting and foreign military sales?
Why only two credit hours for government contract costs and pricing, one of the most important courses of all, when you probably need six credit hours (three for cost-based pricing and three for market based pricing)? Read the course description. The course is about the legal aspects of pricing, not the practical aspects. You're not going to learn how commercial firms price their products or services, or how costs are analyzed and established for major systems.
Defense spending dominates government contracting and defense programs are the government's largest and most controversial. Where is the class about major systems acquisition? Where is the class about the structure and performance of the defense industry? Where is the class about contracting in a monopsony market? Why only two credit hours for intellectual property (patents and data rights), an important and complex topic, especially in defense contracting. Information technology programs are the second most controversial in government contracting. Where is the class about that?
Why a course about financial accounting, but not about cost accounting (aka management accounting), which is of greater interest and concern to contracting practitioners?
Why no class about themes and fads in the history of government contracting? Why no class about the role of Congress in contracting policy development and management? What about contracting policy development process? What about the government program planning, budgeting, appropriation, and funds management processes? What about systems analysis and engineering? What about risk management? What about about competition theory and practice and negotiation theory and practice? What about contracting process design? What about about the politics and economics of socio-economics programs? What about the politics and economics of major systems acquisition? What about statutory and regulatory interpretation? How about a class in business writing for the contracting practitioner? And why not any focus on service contracting, which has been a dominant concern in government contracting for the past decade?
While I am all for advanced education, I'm not for degree bagging, even if the degree is from GWU, especially when the degree is expensive and based on a curriculum that does not reflect the needs of today's contracting practitioners. People considering the program ought to do some market research and find out what they would be paying for if they were admitted and ask themselves whether attendance would worth the price and a best value. Ask yourself: Will this degree get me promoted? Will it enable me to get enough additional salary to make the gain worth the cost?
Knowing how much we Americans love and respect credentials, I have no doubt that GWU will receive many applications, and that many tuitions will be paid by students and employers, including the government, especially DOD. (Military officers in the D.C. area who need at least one graduate degree to get promoted will line up.) I guess it's a start, but this isn't the program that we need, and I don't recommend it as it is. I want better education for contracting professionals, but not just any education. If learning is what interests you, you'd be better off just buying some books and reading them.
↧
REAs and Claims: Is There A Difference?
Despite the plain language of the FAR definition of claim and an overwhelming amount of case law, many contracting practitioners falsely believe that claims and requests for equitable adjustment (REA) under a contract clause are categorically different, that a contractor must submit an REA before it can submit a claim, and that there can’t be a claim until the parties have reached an impasse or are in dispute. Those beliefs are untrue. My objective in this blog entry is to explain why.
What Is a "claim"?
The Contract Disputes Act, 41 U.S.C. 7101 – 7109, does not define claim. The only official definition is in FAR 2.101, which defines "claim" as follows:
Second, "sum certain" means a specific amount. There can be no equivocation using language such as “approximately,” “at least,” “in excess of,” “well over,” or “no less than.” However, the sum certain requirement can be met through the use of a formula that permits the amount to be determined mathematically. (See Note 3.)
Third, although the FAR definition does not say so, the CDA and the boards and courts require that in order to be a claim a contractor's request for relief must ask the CO for a decision on the matter. See 41 U.S.C. Sec. 7103( a ). The request need not be explicit, but may be implied from the context of the assertion or demand. See James M. Ellett Construction Co. v. United States, 93 F.3d 1537, 1543 (Fed. Cir. 1996); BLR Group of America, Inc. v. United States, 96 Fed. Cl. 9, 13 (2010).
Fourth, although the second sentence in the definition says that contractors must certify claims “seeking payment of money” in excess of $100,000, the CDA requires certification of any monetary claim in excess of $100,000, whether for immediate payment or price adjustment. See 41 U.S.C. 7103( b ).
Contracting practitioners must be able to recognize a claim when they see one.
The submission and receipt of a claim have four important legal consequences:
1. Interest begins to accrue when the CO receives a claim, but not when he receives a non-claim request for contractual relief. See FAR 33.208. (But see also Note 4.)
2. COs must make final decisions on claims within statutory deadlines, see FAR 33.211( c ), but they face no deadline for responding to non-claim requests for contractual relief.
3. Contractors cannot recover the costs of claim preparation and prosecution, but they can recover the costs of the preparation of non-claim requests for contractual relief. See FAR 31.205-33( b ) and 31.205-47( f )(1).
4. The jurisdiction of the boards of contract appeals and the U.S. Court of Federal Claims to adjudicate a contractor's appeal under the CDA is predicated upon ( a ) the submission of a CDA "claim" and ( b ) issuance of a CO final decision. See Reflectone, Inc. v. Dalton, Secretary of the Navy, 60 F.3d 1572, 1575 (Fed, Cir. 1995), and James M. Ellett Construction Co. Inc. v. United States, 93 F.3d 1537, 1541 - 42 (Fed. Cir. 1996). Unless a contractor has submitted a claim and the CO has issued a final decision, the boards and the Court of Federal Claims have no jurisdiction under the CDA. They have no jurisdiction under the CDA over non-claim submissions, not even if the CO mistakenly issued a final decision when none was required. See Agility Defense & Government Services, Inc. v. United States, 103 Fed. Cl. 366 (2012). In that case the contractor submitted a document that did not possess the required elements of a claim as defined in FAR 2.101. Nevertheless, the CO issued a "final decision." The contractor appealed the decision, but the court dismissed the appeal for lack of subject matter jurisdiction, because the contractor's submission did not have all of the elements of a claim as defined in FAR 2.101. The court said:
Thus, acquisition practitioners must know when they are submitting or when they have received a claim. Claims are not always easy to recognize, however.
A claim need not be in any particular format or use any particular language.
The definition of claim specifies no format for a claim and does not require the use of specific words of terms, except for the claim certification. The courts and boards have consistently held over the course of many years that a claim need not be in any particular format or stated in any particular language. A claim need not be labeled "Claim." See Contract Cleaning Maintenance, Inc. v. United States, 811 Fed. 2d 586, 592 (Fed. Cir. 1987):
See also SITCO General Trading and Contracting Co. v. United States, 87 Fed. Cl. 506, 508 (2009).
A submission need not include a cost breakdown or other supporting cost data in order to be a claim. See H.L. Smith, Inc. v. Dalton, Secretary of the Navy, 49 F.3d 1563, 1564 (Fed. Cir. 1995):
Thus, a claim could be a simple letter. See Transamerica Insurance Corp. v. United States, 973 F.2d 1572, 1576 (Fed.Cir.1992):
A simple claim under $100,000 might be stated in a single sentence. See Cibinic, Nash & Nagle, Administration of Government Contracts 1264 (4th ed., 2006):
Thus, a request for relief without supporting data might be a claim, but without the supporting data it might not be sufficient to prove the contractor's entitlement to the relief sought.
In pointing these things out I am not suggesting that contractors submit undocumented claims. My only purpose is to show that a contractor's submission need not be thoroughly documented in order be a claim and thus trigger the legal consequences of submitting a claim. Best practice is, of course, to prepare claims carefully and document them as thoroughly as possible.
The content is what matters, not what you call it.
The determination of whether a contractor’s submission to a CO is or is not a claim does not depend on what the parties call it. The mere fact that a contractor calls its submission a claim will not make it a claim if it lacks any necessary element of a claim. And calling a submission an REA does not mean that it is not a claim if it possesses all of the necessary elements of a claim. Claims and REAs are not categorically different things. It is the content of a submission, not what the parties label it or call it, that determines whether it is a claim.
In Zafer Taahhut Insaat ve Ticaret A.S., ASBCA 56770, 11-2 BCA ¶ 34841 (2011), the government argued that a contractor’s REA was not a claim because the contractor used the word “request” instead of claim in its claim certification. The board rejected that argument:
Request for reconsideration denied, Zafer Taahhut Insaat ve Ticaret A.S., ASBCA 56770, 12-1 BCA ¶ 34951 (2012). See also Saco Defense, Inc., ASBCA 44792, 93-3 BCA ¶ 26029:
What is an REA?
The CDA does not mention REAs. Although the term REA appears in 31 places in the FAR System -- ten places in the FAR itself, the rest in seven agency FAR supplements -- the FAR does not define REA.
"Request for equitable adjustment" is a term of art for just what the name indicates: (a ) a request ( b ) for an equitable adjustment to one or more contract terms. REAs are grounded on contract clauses that provide for such relief, such as the "Changes" clauses, FAR 52.243-1 through - 5; the "Differing Site Conditions" clause, FAR 52.236-2; and the "Government Property" clause, FAR 52.245-1.
Contractors doing business with the Department of Defense that submit non-claim REAs valued at more than the simplified acquisition threshold must certify them as required by DFARS 243.204-71 and 252.243-7002. The certification reads as follows:
An REA valued at more than the simplified acquisition threshold that includes the REA certification, but not the claim certification, is an REA that is not a claim, because it lacks one of the necessary elements of a claim. If the same REA is certified as a claim, and has the other necessary elements of a claim, then it is an REA that is a claim.
What if a contractor includes both the REA certification and the claim certification? Assuming that the REA has all of the other necessary elements of a claim, it is an REA that is a claim, notwithstanding the inclusion of the REA certification. However, the dual certification might indicate some confusion on the part of the contractor and make its intentions unclear.
Bottom line: An REA is a claim if it has the required elements of a claim as defined in FAR 2.101. An REA that lacks any required element of a claim is not a claim.
An impasse or dispute is not necessary for an REA to be a claim.
Many contracting practitioners think that there must be an impasse in negotiations or that the parties must be in dispute before REAs can be claims. That is not true, as determined in the landmark decision Relectone, Inc. v. Dalton, Secretary of the Navy, 60 F.3d 1572, 1577 (Fed. Cir, 1995):
Reflectone is must reading for all practitioners. (At the time of that decision the definition of claim was in FAR 33.201. It has since been moved to FAR 2.101.)
See also Systems Development Corp. v. McHugh, Secretary of the Army, 658 F.3d 1341, 1346 - 47 (Fed. Cir. 2011):
An REA is not a "routine request for payment."
According to the definition of claim in FAR 2.101, the only thing that has to be in dispute in order to be a claim is a “[a] voucher, invoice, or other routine request for payment,” and REAs are not routine requests for payment. That was settled by the Federal Circuit 17 years ago, in the landmark decision Reflectone, Inc. v. Dalton, 60 F.2d 1572, 1577 (Fed. Cir. 1995):
Some contracting practitioners think that REAs are routine because "they happen all the time." Indeed, they are common in some contracting offices. However, the boards and courts do not interpret "routine" on the basis of frequency, but on the basis of the nature of the cause. See Parsons Global Services, Inc., ex rel. Odell International, Inc. v. McHugh, Secretary of the Army, 677 F.3d 1166, 1170 (Fed. Cir. 2012):
So why the persistent belief in the need for a dispute? It may due to the fact that claims are addressed in FAR clause 52.233-1, "Disputes." The reasoning goes that since claims are discussed in the Disputes clause if follows that there has to be a dispute in order for there to be a claim. Not so. The Disputes clause prescribes the procedure for submitting and processing claims and issuing CO final decisions. The clause does not state that a dispute must precede the submission of a claim, nor does anything in the CDA or in FAR Subpart 33.2, "Disputes."
FAR 33.204, "Policy," might be another reason for the mistaken belief in the need for a dispute. It states, in pertinent part, “Reasonable efforts should be made to resolve controversies prior to the submission of a claim.”
That’s the government’s policy, and it makes good sense from the government's perspective. It is designed to avoid the accrual of interest by encouraging settlement before the contractor submits a claim, on which interest accrues. However, the government’s policy in no way restricts what contractors can do. It does not require that contractors submit non-claim REAs before they submit claims. The CDA requires only that contractors believe they have a right to what they want in order to submit claims. Contractors do not have to first submit a non-claim REA and then wait while the government takes its own sweet time to evaluate the submission and to make repeated requests for more information before getting down to business.
To avoid confusion about claims and REAs, read the definition of claim.
Some of my students express shock and disbelief when I tell them that an REA can be a claim. "Are you saying that all of those REAs we get are claims and have to be treated like claims?" No, I'm not saying that. Here is what I'm saying:
First, when COs receive contractor requests for relief they should use the FAR 2.101 definition of claim as a checklist. No matter what the contractor calls it, a contractor’s request should be treated as a claim if it has all of the elements of a claim as defined in FAR 2.101. If it lacks any element of a claim it need not be treated as a claim.
Second, some inexperienced contractors may not understand that "claim" is an officially defined term with legal implications. If for any reason a CO is not sure about a contractor’s intention the CO should ask the contractor. If the contractor says that it meant to submit a claim, and if the submission lacks any element of a claim, then the CO should tell the contractor so it can correct its submission. The CO should explain the implications with respect to preparation costs if the contractor says it intended to submit a claim. If an REA has the elements of a claim, but the contractor says that it did not intend to submit a claim, the CO should ask for confirmation in writing.
Finally, contractors should check the definition of claim when submitting REAs and make sure that they understand what they are submitting -- either an REA that is not a claim or an REA that is a claim -- and the consequences of submitting it. They should make their intentions clear to COs. A warning: If your intention as a contractor is to submit a claim, then make sure that you get it right. Prepare the claim document well and document it fully. That improves the chances of a successful settlement. The government will not hesitate to challenge board or court jurisdiction over the slightest flaw in your submittal. If they succeed it will result in a significant loss of time and money. If your claim is significant, hire an attorney who knows the rules to assist in its preparation.
Every year we see board and court decisions in which one of the parties disputed the tribunal's jurisdiction on the ground that an REA was not a claim. The government does so to force the parties back to the negotiating table and avoid interest. Contractors do so to retain their entitlement to submission preparation costs. Such litigation is a needless and avoidable waste of money and time.
Knowledge, clear communication, good faith, and good will can prevent misunderstandings and needless jurisdictional litigation. But knowledge must come first.
---------------------------------------------------
Note 1: Relief, as used in the context of the CDA, is a legal term of art that means "The redress or benefit, esp., equitable in nature, ... that a party seeks in court." Black's Law Dictionary, 9th ed. (2009). According to FAR 33.213( a ), a claim for relief` "arising under a contract" is a claim that can be resolved under a contract clause other than the Disputes clause, FAR 52.233-1. A claim for relief "relating to a contract" is a claim for which no contract clause except for the Disputes clause provides for the relief sought. It is a breach of contract claim.
Note 2:
The dollar value of a claim for certification purposes is the absolute value of increases and decreases. See FAR 33.207( d ).
Note 3: Professor Ralph C. Nash, Jr. discusses the sum certain requirement in the August 2012 edition of The Nash & Cibinic Report: “Contract Disputes Act claims: the 'sum certain' requirement." 26 N&CR para. 41.
Note 4: FAR 33.208(a) says that interest begins to accrue when the CO receives the claim or when payment otherwise would be due, whichever is later. The FAR is wrong. The U.S. Court of Appeals for the Federal Circuit has thrice ruled that there is a single “red letter date” for the accrual of interest, and that is the date that the CO receives the claim. Furthermore, interest on a claim can accrue even before the contractor incurs any cost. See Richlin Security Service Co. v. United States, 437 F.3d 1296 (Fed. Cir. 2006) (rehearing and rehearing en banc denied); Caldera v. J.S. Alberici Construction Co., 153 F.3d 1381 (Fed. Cir. 1998); and Servidone Construction Corp. v. United States, 931 F.2d 860 (Fed. Cir. 1991).]
What Is a "claim"?
The Contract Disputes Act, 41 U.S.C. 7101 – 7109, does not define claim. The only official definition is in FAR 2.101, which defines "claim" as follows:
“Claim” means a written demand or written assertion by one of the contracting parties seeking, as a matter of right, the payment of money in a sum certain, the adjustment or interpretation of contract terms, or other relief arising under or relating to the contract. However, a written demand or written assertion by the contractor seeking the payment of money exceeding $100,000 is not a claim under the Contract Disputes Act of 1978 until certified as required by the Act. A voucher, invoice, or other routine request for payment that is not in dispute when submitted is not a claim. The submission may be converted to a claim, by written notice to the contracting officer as provided in 33.206(a), if it is disputed either as to liability or amount or is not acted upon in a reasonable time.
Reading that definition closely, we see that there are four sentences. The first sentence defines claim as: (1) a written demand or assertion, (2) by the prime contractor or the government, (3) seeking "relief" to which the contractor or the government believes it is entitled pursuant to the terms of a contract clause or due to breach of contract by the other party. (See Note 1.) In order to be a claim a contractor's request for contractual relief must have all of the elements stated in the first sentence.
The second sentence requires certification of claims for more than $100,000. (See Note 2.) A contractor request for more than $100,000 that is not certified is not a claim.
The third sentence says that routine requests for payment must be in dispute when submitted in order to be a claim. Thus, a request for payment upon completion of performance and acceptance of the work or a request for a progress payment is not a claim unless it was in dispute when submitted.
The fourth sentence says that a routine request for payment may be converted to a claim under certain circumstances.
We need to dig still deeper. First, the words "assertion" and "demand" in the first sentence are legal terms of art for requests for what one believes he or she is entitled to. See Blacks Law Dictionary 9th (2009). They should not be understood to mean that a contractor’s request must be strident, angry, or vehement, or be the product of strife or dispute.
Second, "sum certain" means a specific amount. There can be no equivocation using language such as “approximately,” “at least,” “in excess of,” “well over,” or “no less than.” However, the sum certain requirement can be met through the use of a formula that permits the amount to be determined mathematically. (See Note 3.)
Third, although the FAR definition does not say so, the CDA and the boards and courts require that in order to be a claim a contractor's request for relief must ask the CO for a decision on the matter. See 41 U.S.C. Sec. 7103( a ). The request need not be explicit, but may be implied from the context of the assertion or demand. See James M. Ellett Construction Co. v. United States, 93 F.3d 1537, 1543 (Fed. Cir. 1996); BLR Group of America, Inc. v. United States, 96 Fed. Cl. 9, 13 (2010).
Fourth, although the second sentence in the definition says that contractors must certify claims “seeking payment of money” in excess of $100,000, the CDA requires certification of any monetary claim in excess of $100,000, whether for immediate payment or price adjustment. See 41 U.S.C. 7103( b ).
Contracting practitioners must be able to recognize a claim when they see one.
The submission and receipt of a claim have four important legal consequences:
1. Interest begins to accrue when the CO receives a claim, but not when he receives a non-claim request for contractual relief. See FAR 33.208. (But see also Note 4.)
2. COs must make final decisions on claims within statutory deadlines, see FAR 33.211( c ), but they face no deadline for responding to non-claim requests for contractual relief.
3. Contractors cannot recover the costs of claim preparation and prosecution, but they can recover the costs of the preparation of non-claim requests for contractual relief. See FAR 31.205-33( b ) and 31.205-47( f )(1).
4. The jurisdiction of the boards of contract appeals and the U.S. Court of Federal Claims to adjudicate a contractor's appeal under the CDA is predicated upon ( a ) the submission of a CDA "claim" and ( b ) issuance of a CO final decision. See Reflectone, Inc. v. Dalton, Secretary of the Navy, 60 F.3d 1572, 1575 (Fed, Cir. 1995), and James M. Ellett Construction Co. Inc. v. United States, 93 F.3d 1537, 1541 - 42 (Fed. Cir. 1996). Unless a contractor has submitted a claim and the CO has issued a final decision, the boards and the Court of Federal Claims have no jurisdiction under the CDA. They have no jurisdiction under the CDA over non-claim submissions, not even if the CO mistakenly issued a final decision when none was required. See Agility Defense & Government Services, Inc. v. United States, 103 Fed. Cl. 366 (2012). In that case the contractor submitted a document that did not possess the required elements of a claim as defined in FAR 2.101. Nevertheless, the CO issued a "final decision." The contractor appealed the decision, but the court dismissed the appeal for lack of subject matter jurisdiction, because the contractor's submission did not have all of the elements of a claim as defined in FAR 2.101. The court said:
"For the above reasons, the Court finds that it does not have jurisdiction to adjudicate Agility's complaint. The Court makes this ruling with some reluctance, given the contracting officer's contribution to a confused set of circumstances."
Thus, acquisition practitioners must know when they are submitting or when they have received a claim. Claims are not always easy to recognize, however.
A claim need not be in any particular format or use any particular language.
The definition of claim specifies no format for a claim and does not require the use of specific words of terms, except for the claim certification. The courts and boards have consistently held over the course of many years that a claim need not be in any particular format or stated in any particular language. A claim need not be labeled "Claim." See Contract Cleaning Maintenance, Inc. v. United States, 811 Fed. 2d 586, 592 (Fed. Cir. 1987):
“We know of no requirement in the Disputes Act that a “claim” must be submitted in any particular form or use any particular wording. All that is required is that the contractor submit in writing to the contracting officer a clear and unequivocal statement that gives the contracting officer adequate notice of the basis and amount of the claim.”
See also SITCO General Trading and Contracting Co. v. United States, 87 Fed. Cl. 506, 508 (2009).
A submission need not include a cost breakdown or other supporting cost data in order to be a claim. See H.L. Smith, Inc. v. Dalton, Secretary of the Navy, 49 F.3d 1563, 1564 (Fed. Cir. 1995):
“[N]either the CDA nor its implementing regulations, the Federal Acquisition Regulations (FAR), requires submission of a detailed cost breakdown or other specific cost-related documentation with the claim.”
Thus, a claim could be a simple letter. See Transamerica Insurance Corp. v. United States, 973 F.2d 1572, 1576 (Fed.Cir.1992):
“This court will not require contractors to do more than to comply as fully and reasonably as possible with the statutory requirements of the CDA when this court has definitively stated that certain “magic words” need not be used and that the intent of the “claim” governs.”
A simple claim under $100,000 might be stated in a single sentence. See Cibinic, Nash & Nagle, Administration of Government Contracts 1264 (4th ed., 2006):
"As long as the contractor's assertion contains the minimum information necessary to inform the contracting officer of what is being claimed and the grounds of the claim, the contracting officer must act on the claim and deny it if the information is insufficient to approve it, Fred A. Arnold, Inc., ASBCA 27151, 83-3 BCA para. 17,517."
Thus, a request for relief without supporting data might be a claim, but without the supporting data it might not be sufficient to prove the contractor's entitlement to the relief sought.
In pointing these things out I am not suggesting that contractors submit undocumented claims. My only purpose is to show that a contractor's submission need not be thoroughly documented in order be a claim and thus trigger the legal consequences of submitting a claim. Best practice is, of course, to prepare claims carefully and document them as thoroughly as possible.
The content is what matters, not what you call it.
The determination of whether a contractor’s submission to a CO is or is not a claim does not depend on what the parties call it. The mere fact that a contractor calls its submission a claim will not make it a claim if it lacks any necessary element of a claim. And calling a submission an REA does not mean that it is not a claim if it possesses all of the necessary elements of a claim. Claims and REAs are not categorically different things. It is the content of a submission, not what the parties label it or call it, that determines whether it is a claim.
In Zafer Taahhut Insaat ve Ticaret A.S., ASBCA 56770, 11-2 BCA ¶ 34841 (2011), the government argued that a contractor’s REA was not a claim because the contractor used the word “request” instead of claim in its claim certification. The board rejected that argument:
“The government objects to Zafer's 1 August 2007 REA as the basis for our jurisdiction, alleging that the document is a preliminary request for equitable adjustment, and does not adhere to CDA certification requirements because 'request' is twice substituted for 'claim' and the authority of the certifier is not stated. We find that the REA is a cognizable claim, as it adequately informs the government of the basis and precise amount of the claim and that the use of the word 'request' in lieu of 'claim' is inconsequential.”
Request for reconsideration denied, Zafer Taahhut Insaat ve Ticaret A.S., ASBCA 56770, 12-1 BCA ¶ 34951 (2012). See also Saco Defense, Inc., ASBCA 44792, 93-3 BCA ¶ 26029:
“[T]he threshold question is whether that submission constituted a “claim” under the CDA. To that end, it does not matter if the submission is styled as a ‘claim,’ a ‘proposal,’ a ‘request for equitable adjustment,’ or something else. What matters is that the submission satisfies the definition of ‘claim’ prescribed in applicable implementing regulations and contract clauses, as interpreted by the Federal Circuit.”
What is an REA?
The CDA does not mention REAs. Although the term REA appears in 31 places in the FAR System -- ten places in the FAR itself, the rest in seven agency FAR supplements -- the FAR does not define REA.
"Request for equitable adjustment" is a term of art for just what the name indicates: (a ) a request ( b ) for an equitable adjustment to one or more contract terms. REAs are grounded on contract clauses that provide for such relief, such as the "Changes" clauses, FAR 52.243-1 through - 5; the "Differing Site Conditions" clause, FAR 52.236-2; and the "Government Property" clause, FAR 52.245-1.
Contractors doing business with the Department of Defense that submit non-claim REAs valued at more than the simplified acquisition threshold must certify them as required by DFARS 243.204-71 and 252.243-7002. The certification reads as follows:
“I certify that the request is made in good faith, and that the supporting data are accurate and complete to the best of my knowledge and belief.”
An REA valued at more than the simplified acquisition threshold that includes the REA certification, but not the claim certification, is an REA that is not a claim, because it lacks one of the necessary elements of a claim. If the same REA is certified as a claim, and has the other necessary elements of a claim, then it is an REA that is a claim.
What if a contractor includes both the REA certification and the claim certification? Assuming that the REA has all of the other necessary elements of a claim, it is an REA that is a claim, notwithstanding the inclusion of the REA certification. However, the dual certification might indicate some confusion on the part of the contractor and make its intentions unclear.
Bottom line: An REA is a claim if it has the required elements of a claim as defined in FAR 2.101. An REA that lacks any required element of a claim is not a claim.
An impasse or dispute is not necessary for an REA to be a claim.
Many contracting practitioners think that there must be an impasse in negotiations or that the parties must be in dispute before REAs can be claims. That is not true, as determined in the landmark decision Relectone, Inc. v. Dalton, Secretary of the Navy, 60 F.3d 1572, 1577 (Fed. Cir, 1995):
"[W]e hold that FAR 33.201 does not require that 'a written demand ... seeking, as a matter of right, the payment of money in a sum certain' must already be in dispute when submitted to the CO to satisfy the definition of 'claim,'exceptwhere that demand or request is a 'voucher, invoice or other routine request for payment.' This interpretation, based on the plain language of the FAR, examines and reconciles the text of the entire regulation, not simply isolated sentences."
Reflectone is must reading for all practitioners. (At the time of that decision the definition of claim was in FAR 33.201. It has since been moved to FAR 2.101.)
See also Systems Development Corp. v. McHugh, Secretary of the Army, 658 F.3d 1341, 1346 - 47 (Fed. Cir. 2011):
"SDC contends that our precedent holds that a claim does not accrue until there is an impasse in negotiations between the contractor and the government. SDC, however, misapprehends our precedent. Impasse is not required for SDC's equitable adjustment claims to accrue.
In support of its impasse theory, SDC points to Rex Systems, Inc. v. Cohen, 224 F.3d 1367 (Fed.Cir.2000). In Rex Systems, we considered when a submission by a contractor to a CO meets the definition of a 'claim' for the purposes of the CDA. See also James M. Ellett Constr. Co. v. United States, 93 F.3d 1537 (Fed.Cir.1996). We acknowledged that not all contractor submissions to a CO are claims. Rex Sys., 224 F.3d. at 1372 ('[A]ny non-routine submission by a contractor meets the definition of a claim if it is: (1) a written demand; (2) seeking as a matter of right; (3) the payment of money in a sum certain.'). In this line of cases, we clarified that termination settlement proposals submitted under the termination for convenience clause of the FAR generally are not CDA claims. Under certain circumstances, however, a termination settlement proposal may ripen into a claim. Id. For example, as we explained in Ellett, a termination settlement proposal may ripen into a CDA claim when the parties' negotiations reach an impasse. 93 F.3d at 1543–44. Contrary to SDC's assertion, nothing in these cases addressed situations beyond termination settlement proposals. Indeed, we emphasized that the FAR “anticipate[s] the submission of claims independently of the termination settlement proposal.” Id. at 1548. We have never indicated that such independently submitted claims require an impasse.
* * *
SDC's equitable adjustment claims were wholly separate from its termination settlement proposal. Nothing precluded SDC from presenting them to a CO as soon as SDC knew of their basis as provided in the FAR."
An REA is not a "routine request for payment."
According to the definition of claim in FAR 2.101, the only thing that has to be in dispute in order to be a claim is a “[a] voucher, invoice, or other routine request for payment,” and REAs are not routine requests for payment. That was settled by the Federal Circuit 17 years ago, in the landmark decision Reflectone, Inc. v. Dalton, 60 F.2d 1572, 1577 (Fed. Cir. 1995):
“[A]n REA is anything but a ‘routine request for payment.’ It is a remedy payable only when unforeseen or unintended circumstances, such as government modification of the contract, differing site conditions, defective or late-delivered government property or issuance of a stop work order, cause an increase in contract performance costs. Pacific Architects and Eng'rs Inc. v. United States, 491 F.2d 734, 739, 203 Ct.Cl. 499 (1974). A demand for compensation for unforeseen or unintended circumstances cannot be characterized as “routine.” The Supreme Court has confirmed the non-routine nature of an REA by equating it with assertion of a breach of contract. Crown Coat Front Co. v. United States, 386 U.S. 503, 511, 87 S.Ct. 1177, 1181, 18 L.Ed.2d 256 (1967) (‘With respect to claims arising under the typical government contract, the contractor has agreed in effect to convert what otherwise might be claims for breach of contract into claims for equitable adjustment.’). Thus, an REA provides an example of a written demand for payment as a matter of right which is not ‘a routine request for payment’ and, therefore, it satisfies the FAR definition of ‘claim’ whether or not the government's liability for or the amount of the REA was already disputed before submission of the REA to the CO.”
Some contracting practitioners think that REAs are routine because "they happen all the time." Indeed, they are common in some contracting offices. However, the boards and courts do not interpret "routine" on the basis of frequency, but on the basis of the nature of the cause. See Parsons Global Services, Inc., ex rel. Odell International, Inc. v. McHugh, Secretary of the Army, 677 F.3d 1166, 1170 (Fed. Cir. 2012):
"The distinction between a routine and non-routine request for payment is a factual one, dependent on the circumstances in which the requested costs arose. A routine request is one incurred and submitted ‘in accordance with the expected or scheduled progression of contract performance.’ Ellett Constr., 93 F.3d at 1542–43. Such requests are ‘made under the contract, not outside it’ and include invoices, vouchers, progress payments, and other requests for costs under the contract's terms. Reflectone, 60 F.3d at 1577. By contrast, a non-routine request is one ‘seeking compensation because of unforeseen or unintended circumstances.’ Ellett Constr., 93 F.3d at 1543; Reflectone, 60 F.3d at 1577. Such requests include requests for equitable adjustments for costs incurred from “government modification of the contract, differing site conditions, defective or late-delivered government property or issuance of a stop work order” and other government-ordered changes, Reflectone, 60 F.3d at 1577; for damages resulting from the government's termination for convenience and termination settlement proposals that have reached an impasse, Ellett Constr., 93 F.3d at 1542–43; for compensation for additional work not contemplated by the contract but demanded by the government, Scan–Tech Sec., L.P. v. United States, 46 Fed.Cl. 326, 333 (2000); for the return of contractor property in the government's possession, J & E Salvage Co. v. United States, 37 Fed.Cl. 256, 261 n. 4 (1997), aff'd, 152 F.3d 945 (1998) (table); and for damages stemming from the government's breach of contract or cardinal change to the contract, Ky. Bridge & Dam, Inc. v. United States, 42 Fed.Cl. 501, 518–19 (1998). A common thread among these examples is the presence of some unexpected or unforeseen action on the government's part that ties it to the demanded costs."
So why the persistent belief in the need for a dispute? It may due to the fact that claims are addressed in FAR clause 52.233-1, "Disputes." The reasoning goes that since claims are discussed in the Disputes clause if follows that there has to be a dispute in order for there to be a claim. Not so. The Disputes clause prescribes the procedure for submitting and processing claims and issuing CO final decisions. The clause does not state that a dispute must precede the submission of a claim, nor does anything in the CDA or in FAR Subpart 33.2, "Disputes."
FAR 33.204, "Policy," might be another reason for the mistaken belief in the need for a dispute. It states, in pertinent part, “Reasonable efforts should be made to resolve controversies prior to the submission of a claim.”
That’s the government’s policy, and it makes good sense from the government's perspective. It is designed to avoid the accrual of interest by encouraging settlement before the contractor submits a claim, on which interest accrues. However, the government’s policy in no way restricts what contractors can do. It does not require that contractors submit non-claim REAs before they submit claims. The CDA requires only that contractors believe they have a right to what they want in order to submit claims. Contractors do not have to first submit a non-claim REA and then wait while the government takes its own sweet time to evaluate the submission and to make repeated requests for more information before getting down to business.
To avoid confusion about claims and REAs, read the definition of claim.
Some of my students express shock and disbelief when I tell them that an REA can be a claim. "Are you saying that all of those REAs we get are claims and have to be treated like claims?" No, I'm not saying that. Here is what I'm saying:
First, when COs receive contractor requests for relief they should use the FAR 2.101 definition of claim as a checklist. No matter what the contractor calls it, a contractor’s request should be treated as a claim if it has all of the elements of a claim as defined in FAR 2.101. If it lacks any element of a claim it need not be treated as a claim.
Second, some inexperienced contractors may not understand that "claim" is an officially defined term with legal implications. If for any reason a CO is not sure about a contractor’s intention the CO should ask the contractor. If the contractor says that it meant to submit a claim, and if the submission lacks any element of a claim, then the CO should tell the contractor so it can correct its submission. The CO should explain the implications with respect to preparation costs if the contractor says it intended to submit a claim. If an REA has the elements of a claim, but the contractor says that it did not intend to submit a claim, the CO should ask for confirmation in writing.
Finally, contractors should check the definition of claim when submitting REAs and make sure that they understand what they are submitting -- either an REA that is not a claim or an REA that is a claim -- and the consequences of submitting it. They should make their intentions clear to COs. A warning: If your intention as a contractor is to submit a claim, then make sure that you get it right. Prepare the claim document well and document it fully. That improves the chances of a successful settlement. The government will not hesitate to challenge board or court jurisdiction over the slightest flaw in your submittal. If they succeed it will result in a significant loss of time and money. If your claim is significant, hire an attorney who knows the rules to assist in its preparation.
Every year we see board and court decisions in which one of the parties disputed the tribunal's jurisdiction on the ground that an REA was not a claim. The government does so to force the parties back to the negotiating table and avoid interest. Contractors do so to retain their entitlement to submission preparation costs. Such litigation is a needless and avoidable waste of money and time.
Knowledge, clear communication, good faith, and good will can prevent misunderstandings and needless jurisdictional litigation. But knowledge must come first.
---------------------------------------------------
Note 1: Relief, as used in the context of the CDA, is a legal term of art that means "The redress or benefit, esp., equitable in nature, ... that a party seeks in court." Black's Law Dictionary, 9th ed. (2009). According to FAR 33.213( a ), a claim for relief` "arising under a contract" is a claim that can be resolved under a contract clause other than the Disputes clause, FAR 52.233-1. A claim for relief "relating to a contract" is a claim for which no contract clause except for the Disputes clause provides for the relief sought. It is a breach of contract claim.
Note 2:
The certification for claims in excess of $100,000 is stated in FAR 33.207 as follows:
I certify that the claim is made in good faith; that the supporting data are accurate and complete to the best of my knowledge and belief; that the amount requested accurately reflects the contract adjustment for which the contractor believes the Government is liable; and that I am duly authorized to certify the claim on behalf of the contractor.
The dollar value of a claim for certification purposes is the absolute value of increases and decreases. See FAR 33.207( d ).
Note 3: Professor Ralph C. Nash, Jr. discusses the sum certain requirement in the August 2012 edition of The Nash & Cibinic Report: “Contract Disputes Act claims: the 'sum certain' requirement." 26 N&CR para. 41.
Note 4: FAR 33.208(a) says that interest begins to accrue when the CO receives the claim or when payment otherwise would be due, whichever is later. The FAR is wrong. The U.S. Court of Appeals for the Federal Circuit has thrice ruled that there is a single “red letter date” for the accrual of interest, and that is the date that the CO receives the claim. Furthermore, interest on a claim can accrue even before the contractor incurs any cost. See Richlin Security Service Co. v. United States, 437 F.3d 1296 (Fed. Cir. 2006) (rehearing and rehearing en banc denied); Caldera v. J.S. Alberici Construction Co., 153 F.3d 1381 (Fed. Cir. 1998); and Servidone Construction Corp. v. United States, 931 F.2d 860 (Fed. Cir. 1991).]
↧
Can a CO update the clauses in an existing contract when the FAR changes or when exercising options?
Two of my students, who work for a very large government contractor, told me that the contracting officers (COs) who administer their contracts unilaterally update contract clauses from time to time when they add funds to the contract or when they exercise options. They wondered if that was okay.
It's not okay.
More than a few people believe that the government must update contract clauses when the government changes the Federal Acquisition Regulation (FAR). Some of them think that the government may do so unilaterally. Others believe that contracts are “automatically” updated when the government changes the FAR. Those beliefs are false.
Once the government and a contractor enter into a contract a deal is a deal, and the government and the contractor are bound by the clauses in the awarded contracts until the contracts are completed. Nothing in FAR and no standard FAR clause authorizes a CO to unilaterally update, add, or delete clauses in a contract after award. None of the five Changes clauses, FAR 52.243-1 through -5, empower a CO to do that.
Thus, with a few exceptions, which are discussed below, changes to FAR clauses — revisions, additions, and deletions — must be accomplished through supplemental agreement , 197 Ct. Cl. 11 (1972).
Any attempt by the government to impose new terms on a contractor when exercising an option would be breach of contract and would invalidate the option. See New England Tank Industries of New Hampshire, Inc. v. U.S., 861 F. 2d 685 (Fed. Cir. 1988):
The rule that exercise of an option must be in accordance with the terms of the option as awarded is reflected in FAR 17.207(e), which requires that before exercising an option the CO must make a written determination that the exercise “is in accordance with the terms of the option….” Thus, unless a contract contains an express term to the contrary, COs have no authority to unilaterally update contract clauses when exercising options.**
What is the effect of changes to parts of the FAR that were incorporated into a contract by reference?
Several FAR contract clauses incorporate parts of the FAR into contracts by reference. See e.g., FAR 52.202-1, which incorporates FAR definitions “in effect at the time the solicitation was issued,” and 52.216-7(a)(1), which incorporates the version of FAR Subpart 31.2 “in effect on the date of this contract.” In those examples, the terms of the FAR are fixed in time and cannot be altered without mutual agreement of the parties and consideration.
But what if the clause does not fix the terms of the FAR? See e.g., FAR 52.211-15, “Defense Priority and Allocation Requirements (APR 2008).” It requires the contractor to comply with “15 C.F.R. 700,” without further qualification. See also the various small business clauses that require the contractor to comply with Title 19 of the C.F.R., and the labor law clauses that require the contractor to comply with Title 29. If those regulations change after contract award the contractor is always bound by the current regulation. In such cases the updating is automatic and does not require a contract modification unless the clause provides for an adjustment of some kind, equitable or otherwise.
As I mentioned above, some clauses, such as the Cost Accounting Standards clause, provide for automatic updating with price adjustment.
Can Congress enact a law that changes existing contracts?
Yes, but they might breach the contract if they do. That was the holding of the Supreme Court in United States v. Winstar Corp., cited above, in which Congress changed a law, and the agency changed its regulations accordingly, after entering into contracts with financial institutions:
In Winstar, the court quoted its decision in Sinking Fund Cases, 99 U.S. 700 (1879):
Conclusion
Getting back to my two students, absent express language in the contract to the contrary, a CO may not unilaterally change the clauses in a contract when funding the contract or exercising an option. He or she may change clauses only with the assent of the contractor and with consideration for the change.
I asked my two students how they responded when their COs unilaterally updated the clauses in their contracts. They said that they went along with it, because so far none of the changes had much if any effect. That is too bad, because they are teaching the COs in question that what they are doing is okay. It is not okay. And it is not wise for one party to a contract to let the other party violate its rights by unilaterally imposing new terms.
*Note that “consideration” is not the same as an “equitable adjustment.” An equitable adjustment is a fair increase or decrease in the contract price or estimated cost and fee and the time required for contract performance, as required by a contract clause, such as a Changes clause or Differing Site Conditions clause. The amount of the equitable adjustment is based on the estimated or actual effect of the change on the cost or time required for performance. When the parties to a contract agree to modify it on the basis of mutual agreement, and not in accordance with a contract clause that provides for equitable adjustment, the parties are making a new bargain and the bargain must be supported by consideration in order to be enforceable in court. Consideration is necessary whether or not there is any effect on cost or time. The amount of the consideration is not determined or limited on the basis of the effect on cost or time, but is determined through bargaining. The consideration would flow from the party that will benefit from inclusion of the clause to the party that agrees to its inclusion.
**However, the parties may change the terms of a future option period pursuant to the terms of contract clauses, such as the Changes clause, or pursuant to a justification for other than full and open competition.
It's not okay.
More than a few people believe that the government must update contract clauses when the government changes the Federal Acquisition Regulation (FAR). Some of them think that the government may do so unilaterally. Others believe that contracts are “automatically” updated when the government changes the FAR. Those beliefs are false.
Once the government and a contractor enter into a contract a deal is a deal, and the government and the contractor are bound by the clauses in the awarded contracts until the contracts are completed. Nothing in FAR and no standard FAR clause authorizes a CO to unilaterally update, add, or delete clauses in a contract after award. None of the five Changes clauses, FAR 52.243-1 through -5, empower a CO to do that.
Thus, with a few exceptions, which are discussed below, changes to FAR clauses — revisions, additions, and deletions — must be accomplished through supplemental agreement , 197 Ct. Cl. 11 (1972).
See also, McArthur et al. v. Rosenbaum Company of Pittsburg, 180 F.2d 617, 620 (3rd Cir., 1950). Even substantial compliance with the terms of an option is insufficient. See 17 CJS, Contracts, Section 42, n. 83(2) at 676.
Any attempt by the government to impose new terms on a contractor when exercising an option would be breach of contract and would invalidate the option. See New England Tank Industries of New Hampshire, Inc. v. U.S., 861 F. 2d 685 (Fed. Cir. 1988):
It is well-settled that to properly exercise [an] option, the government’s acceptance of the offer [must] be unconditional and in exact accord with the terms of the contract being renewed.
* * *
The dispositive question is whether the government's exercise of its option to renew the contract was valid or invalid. As above noted, the board recognized that an attempt to alter the contract terms would “render ineffective the purported exercise of an option,” and that insertion of an “availability of funds” clause renders the option exercise “invalid”, see 88–1 BCA at 103,166, and neither party quarrels with those statements of the law.
The rule that exercise of an option must be in accordance with the terms of the option as awarded is reflected in FAR 17.207(e), which requires that before exercising an option the CO must make a written determination that the exercise “is in accordance with the terms of the option….” Thus, unless a contract contains an express term to the contrary, COs have no authority to unilaterally update contract clauses when exercising options.**
What is the effect of changes to parts of the FAR that were incorporated into a contract by reference?
Several FAR contract clauses incorporate parts of the FAR into contracts by reference. See e.g., FAR 52.202-1, which incorporates FAR definitions “in effect at the time the solicitation was issued,” and 52.216-7(a)(1), which incorporates the version of FAR Subpart 31.2 “in effect on the date of this contract.” In those examples, the terms of the FAR are fixed in time and cannot be altered without mutual agreement of the parties and consideration.
But what if the clause does not fix the terms of the FAR? See e.g., FAR 52.211-15, “Defense Priority and Allocation Requirements (APR 2008).” It requires the contractor to comply with “15 C.F.R. 700,” without further qualification. See also the various small business clauses that require the contractor to comply with Title 19 of the C.F.R., and the labor law clauses that require the contractor to comply with Title 29. If those regulations change after contract award the contractor is always bound by the current regulation. In such cases the updating is automatic and does not require a contract modification unless the clause provides for an adjustment of some kind, equitable or otherwise.
As I mentioned above, some clauses, such as the Cost Accounting Standards clause, provide for automatic updating with price adjustment.
Can Congress enact a law that changes existing contracts?
Yes, but they might breach the contract if they do. That was the holding of the Supreme Court in United States v. Winstar Corp., cited above, in which Congress changed a law, and the agency changed its regulations accordingly, after entering into contracts with financial institutions:
When the law as to capital requirements changed in the present instance, the Government was unable to perform its promise and, therefore, became liable for breach. We accept the Federal Circuit's conclusion that the Government breached these contracts when, pursuant to the new regulatory capital requirements imposed by FIRREA [Financial Institutions Reform, Recovery, and Enforcement Act of 1989], 12 U.S.C. § 1464(t), the federal regulatory agencies limited the use of supervisory goodwill and capital credits in calculating respondents' net worth. 64 F.3d, at 1545. In the case of Winstar and Statesman, the Government exacerbated its breach when it seized and liquidated respondents' thrifts for regulatory noncompliance. Ibid.
In Winstar, the court quoted its decision in Sinking Fund Cases, 99 U.S. 700 (1879):
The United States are as much bound by their contracts as are individuals. If they repudiate their obligations, it is as much repudiation, with all the wrong and reproach that terms implies, as it would be if the repudiator had been a State or a municipality or a citizen.
Conclusion
Getting back to my two students, absent express language in the contract to the contrary, a CO may not unilaterally change the clauses in a contract when funding the contract or exercising an option. He or she may change clauses only with the assent of the contractor and with consideration for the change.
I asked my two students how they responded when their COs unilaterally updated the clauses in their contracts. They said that they went along with it, because so far none of the changes had much if any effect. That is too bad, because they are teaching the COs in question that what they are doing is okay. It is not okay. And it is not wise for one party to a contract to let the other party violate its rights by unilaterally imposing new terms.
NOTES
*Note that “consideration” is not the same as an “equitable adjustment.” An equitable adjustment is a fair increase or decrease in the contract price or estimated cost and fee and the time required for contract performance, as required by a contract clause, such as a Changes clause or Differing Site Conditions clause. The amount of the equitable adjustment is based on the estimated or actual effect of the change on the cost or time required for performance. When the parties to a contract agree to modify it on the basis of mutual agreement, and not in accordance with a contract clause that provides for equitable adjustment, the parties are making a new bargain and the bargain must be supported by consideration in order to be enforceable in court. Consideration is necessary whether or not there is any effect on cost or time. The amount of the consideration is not determined or limited on the basis of the effect on cost or time, but is determined through bargaining. The consideration would flow from the party that will benefit from inclusion of the clause to the party that agrees to its inclusion.
**However, the parties may change the terms of a future option period pursuant to the terms of contract clauses, such as the Changes clause, or pursuant to a justification for other than full and open competition.
↧
↧
THINK! (maybe)
On April 24, the Under Secretary of Defense for Acquisition, Technology and Logistics issued a memorandum about implementation of the “Better Buying Power” initiative, phase 2.0. You can find it at:
http://bbp.dau.mil/
Sigh, another acquisition improvement memo.
But, reading the thing, I came upon this interesting paragraph:
“Think”! Now that’s something you don’t often see in an official memo. You’re much more likely to see something like, Just do it. Why did the Under Secretary write that? Does he believe that people haven’t been thinking, or was “Think” just a rhetorical exhortation? Let’s give him the benefit of the doubt and assume that he really isn’t happy with the present state of acquisition thinking. He shouldn’t be.
What Is Thinking?
What does “Think” mean? Let’s think about this. “Think.” What is thinking, exactly? It’s a mental activity, we all know that. Is it something that must be accomplished, or is it a method of accomplishing something? Is it a function — a set of tasks directed towards a general purpose, like maintenance, or is it a specific task? Is it a method? If so, is it a specific method or is there more than one way to think? If there is more than one method, how many more, and in what ways do they differ? Is thinking the same as reasoning? Can one think without reasoning, or reason without thinking? Is there unreasoning thinking, or unthinking reasoning?
As I pondered thinking I recalled a book that might help and rummaged around in my library until I found it: What Is Called Thinking? (English trans., 1968) by Martin Heidegger. I shuddered as I recalled the college course (oh, so long ago) in which it was assigned reading. I frankly don’t remember much about the book, and my old underlining didn’t help. But the very first two paragraphs were a bad omen:
That book is sitting on my nightstand now, like the raven on Poe's bust of Athena. It’s time to pull out a dictionary.
One of the definitions for think in the American Heritage Dictionary of the English Language, 5th ed., is as follows:
A Dictionary of Philosophy, Rev. 2d ed. (1979), by Anthony Flew, provides something a little more expansive on pp. 352 - 353:
I found a longer entry about thinking in Volume 8 of The Encyclopedia of Philosophy, Reprint Edition (1972), pp. 100 – 103, which contains the following:
Despite their obvious shortcomings, I like those last two explanations, because I can relate them to things that contracting personnel do at work. For instance thinking about what evaluation factors to use in a source selection is deliberation. Thinking about what kind of thing an evaluation factor is and what kinds of evaluation factors there are is contemplation. Deliberation is practical. Contemplation is theoretical. You deliberate in order to decide what to do. You contemplate in order to understand and develop ideas.
So, what is thinking? (The definitions that I quoted are from lexicographers and philosophers. A psychologist might answer differently. See Thinking, Fast and Slow (2011), by Daniel Kahneman.) I believe thinking is a debate with yourself — a purposeful process of asking yourself questions about something and then trying to answer them. You ask, you answer, you challenge, you respond, and you decide, just you and yourself, in foro interno. For example: What is an evaluation factor? Answering entails definition, induction, analysis, classification, deduction, and argument. Each of those operations should be performed according to exacting standards of rigorous thought. You will get a different answer from other people. It is something to think about. But right now I like the contemplation/deliberation distinction and will run with it.
Contemplation and Deliberation
It seems to me that in order to deliberate well, you must contemplate first. You cannot deliberate well about what contract type to use until you first contemplate the concept of contract types until you understand what they are and how they are supposed to work. In order to do that you must read more than the summary descriptions in FAR Part 16 or in a set of PowerPoint slides. You must read the standard contract clauses peculiar to each type and think about how the clauses work together and with what results. You must then figure out how each contract type differs from the others. You must also contemplate contract type theory, which holds that the right distribution of cost risk “will provide the contractor the greatest incentive for efficient and economical performance.” Is that true? In order to contemplate contract type theory, you have to contemplate risk: What is it? What causes it? Can you measure it? If so, how? And on, and on. It’s never done.
In order to deliberate well a professional must have a head full of well developed professional ideas gained through contemplation, as many as possible. You will need them in your deliberations. Much deliberating is done in cooperation with others, and you can better communicate and be understood when your ideas are well-developed and deep, so that you can explain them clearly and answer questions.
Where do you get such ideas? You get them by going to school, reading, talking things over with colleagues, and, especially important, by going into a quiet corner and asking yourself questions and developing answers about the things that you have been taught, that you have read, that you have heard, and that you have worked out for yourself. It takes quite a lot of effort, and it takes a long time, a professional lifetime. It’s never done.
Understand Simple Things Deeply
According to The 5 Elements of Effective Thinking (2012) by Edward B. Burger and Michael Starbird, the first key to effective thinking is to master the fundamentals by understanding simple things deeply. “The most fundamental ideas in any subject can be understood with ever-increasing depth.” If asked to explain cost, as used in cost estimate, cost analysis, and should cost, what would you say? If asked to define cost on the spot, could you do it? A cost estimate is an estimate of what, exactly? How much and how good of an explanation could you give to someone who doesn’t know anything about it? How deeply could you go into that concept? Could you anticipate the inevitable questions? Could you answer them?
If you are a contract specialist, how much do you know about the concept of contract? Can you go beyond “an agreement that the courts will enforce” or offer, acceptance, mutual assent, consideration, competent parties, legal purpose, etc., or the definition in FAR 2.101? How long can you talk about What is a contract? Five minutes? Fifteen minutes? An hour? Longer? How much do you know about, and how deeply do you understand, the thing in which you specialize?
In his memo, the Under Secretary alludes to the importance of contemplation:
Contemplation is professional preparation for deliberation. Deliberation is the practical application of professional ideas to professional problems. You cannot deliberate well if you have not first contemplated well, and in order to contemplate well you have to put in a lot of work. And it’s never done.
The Perils of Deliberation without Prior Contemplation
What happens when you deliberate before you contemplate? Consider: The Department of Defense IG recently issued a report that is critical of the way DOD contracting personnel awarded and administered performance based payments (PBP). See DOD Inspector General Report No. DODIG-2013-063, Award and Administration of Performance Based Payments in DOD Contracts, April 8, 2013, and FAR Subpart 32.10, Performance Based Payments.
According to the DODIG:
Italics added.
In order to award performance based payments (instead of progress payments based on costs), contracting officers must identify and select performance events (aka, milestones) and then pay contractors based on the predetermined value of the occurrence of the event. See FAR 32.1004(a)(1). FAR doesn’t explain the concept of an event, but says that contracting officers may not use as events such occurrences as (1) the signing of contracts or modifications, (2) the exercise of options, and (3) the mere passage of time.
Maybe what the DODIG found happened because the contracting personnel deliberated about what events to use before they had contemplated the concept of an event. Perhaps they did not ask and answer some basic questions:
Perhaps they should have contemplated those matters and identified the attributes common to (1) the signing of contracts or modifications, (2) the exercise of options, and (3) the passage of time that make those events unsuitable. Then, when deliberating about what events to use, they could have made sure not to choose any that had those attributes.
Now consider this: Suppose that a source selection team must decide what evaluation factors to use. See FAR 15.304. The team sets to thinking about their choices, and decides to look at old RFPs for examples. They then choose certain ones and cut and paste. They don’t stop to ask themselves:
If the agency’s acquisition personnel don’t devote some time to contemplating those things, if they cut and paste from old RFPs, they may end up making bad choices and being unsuccessful or less efficient and economical than they could have been in identifying the firm that offers best value. See Vernon J. Edwards, “Streamlining Source Selection by Improving the Quality of Evaluation Factors,” The Nash and Cibinic Report, October 1994.
Is Anyone Thinking?
How good are acquisition personnel at thinking? Do they contemplate before they deliberate, and do they contemplate and deliberate well? Are they professionally prepared to do those things, as the Under Secretary says that they must be in order for their thinking to be of any use and to have a good outcome?
Based on extensive personal experience in the classroom, I believe that acquisition personnel could do much better at professional level thinking. They are not alone in that. It is often asserted that today’s undergraduate education does not prepare students to think well. The private sector has long recognized this problem. See “Executives to new grads: Shape up!” by Anne Fisher, accessible on line at CNNMoney:
http://management.fo...grads-shape-up/
See also “What are most students learning in college? Not enough, study says,” by Sara Rimer in The Hechinger Report, January 18, 2011:
http://hechingerrepo...udy-says_4979/.
Many public and private universities and some institutions of professional military education offer courses about thinking. Harvard even has a course called “Thinking about Thinking.” The National Defense University, in conjunction with the Defense Acquisition University, offers a two part, two semester course entitled, Critical Thinking and Decision Making in Defense Acquisition, ICAF 6152-1 and 6153-1, but it is available only to those who already have a Level III certification and who are enrolled in the Senior Acquisition Course. If thinking is so important in acquisition, why isn’t there a course more widely available for those in earlier phases of their professional development? Why wait until someone is a decision maker to offer them such training? Many mature students have complained to me that they didn’t get the right kinds of training early enough in their careers. Why is that so?
Assuming that acquisition personnel know what thinking is and are able to do it well, do they have enough time to think, given their professional workload and their reporting, data entry, and other clerical duties? Do they have enough administrative and clerical support?
The workload has been crushing over the last decade, and the rules keep getting more and more complex. In October 1995, the rule in FAR 16.505( b ) governing the multiple award task order contract “fair opportunity” process was 565 words long. By May 2012 the rule had grown to 2,203 words. There was a similar development in the rule in FAR Subpart 8.4 governing the placement of orders against GSA Federal Supply Schedule contracts. That kind of development means more work to process a contract action. Also, the issuance of new reporting requirements has become practically routine. Administrative and clerical support is virtually nonexistent, yet, every year, Congress and senior officials in the Executive Branch pile more reporting and data entry tasks onto the shoulders of contracting personnel. I believe that I know what a random sample of GS-1102s would say if asked whether they have enough time to think deeply about anything at work.
Think! Really?
Thinking, however, can produce troublesome thoughts, and I wonder if the Under Secretary realizes what he has asked for and, if so, whether he means it. What if people begin to think and their thinking leads them to question fundamental tenets of acquisition dogma? For example, what if contemplation leads them to question the efficacy of proposal-based competition for development contracts? What if they argue that such competitions encourage the submission of inflated promises and foster unrealistic expectations? What if they begin to question the utility of contract incentives and to argue that they cost more to plan and administer than they yield in terms of reductions in cost and improvements in performance?
Will such thinkers be welcomed and their thoughts given serious consideration? Or will they face professional “excommunication” and see their thoughts rejected out of hand? How open will the higher ups be to their ideas? Will they encourage and support such thoughts?
Consider the DOD Source Selection Procedures issued under the previous Under Secretary on March 4, 2011:
http://www.acq.osd.m...183-10-DPAP.pdf
Italics added. “All” -- no exceptions. Waivers require the “express permission” of the Director of Defense Procurement. In short: Don’t think. We’ve already done the thinking. Just do what we say. Use the standardized rating tables, whether they make sense in your case or not, whether or not you think there is a better scheme. That’s ironic in light the Under Secretary’s memo: “Our workforce should be encouraged by leaders to think and not to automatically default to a perceived school solution just because it is expected to be approved more easily.”
Yet, we need thinkers in acquisition, and good ones. I recently read the following in “Education for Critical Thinking,” by Col. Thomas M. Williams, in Military Review, January-February 2013, pp. 49- 54:
Substitute acquisition for “war” and “operational,” and I think his statement applies equally well to the work of acquisition professionals.
Acquisition is a squishy field. While there are acquisition laws, regulations, and dogma, to be sure, most of the big problems involve fuzzy logic, and experts can and do disagree about solutions. Critical thinking is an essential skill. So it makes sense that the Under Secretary demands that DOD acquisition professionals think, but it is ironic that his office has issued directives like the source selection memo.
I wonder whether the Under Secretary is serious about wanting acquisition personnel to think. If he is serious, I wonder what he is going to do about it. A memo isn’t an accomplishment. Is it? Well, is it?
http://bbp.dau.mil/
Sigh, another acquisition improvement memo.
But, reading the thing, I came upon this interesting paragraph:
Think. The first responsibility of the acquisition workforce is to think. We need to be true professionals who apply our education, training, and experience through analysis and creative, informed thought to address our daily decisions. Our workforce should be encouraged by leaders to think and not to automatically default to a perceived school solution just because it is expected to be approved more easily. BBP 2.0, like BBP 1.0, is not rigid dogma ¾ it is guidance subject to professional judgment.
“Think”! Now that’s something you don’t often see in an official memo. You’re much more likely to see something like, Just do it. Why did the Under Secretary write that? Does he believe that people haven’t been thinking, or was “Think” just a rhetorical exhortation? Let’s give him the benefit of the doubt and assume that he really isn’t happy with the present state of acquisition thinking. He shouldn’t be.
What Is Thinking?
What does “Think” mean? Let’s think about this. “Think.” What is thinking, exactly? It’s a mental activity, we all know that. Is it something that must be accomplished, or is it a method of accomplishing something? Is it a function — a set of tasks directed towards a general purpose, like maintenance, or is it a specific task? Is it a method? If so, is it a specific method or is there more than one way to think? If there is more than one method, how many more, and in what ways do they differ? Is thinking the same as reasoning? Can one think without reasoning, or reason without thinking? Is there unreasoning thinking, or unthinking reasoning?
As I pondered thinking I recalled a book that might help and rummaged around in my library until I found it: What Is Called Thinking? (English trans., 1968) by Martin Heidegger. I shuddered as I recalled the college course (oh, so long ago) in which it was assigned reading. I frankly don’t remember much about the book, and my old underlining didn’t help. But the very first two paragraphs were a bad omen:
We come to know what it means to think when we ourselves try to think. If the attempt is to be successful, we must be ready to learn thinking.
As soon as we allow ourselves to become involved in such learning, we have admitted that we are not yet capable of thinking.
That book is sitting on my nightstand now, like the raven on Poe's bust of Athena. It’s time to pull out a dictionary.
One of the definitions for think in the American Heritage Dictionary of the English Language, 5th ed., is as follows:
To reason about or reflect on; ponder… To decide by reasoning, reflection, or pondering….
A Dictionary of Philosophy, Rev. 2d ed. (1979), by Anthony Flew, provides something a little more expansive on pp. 352 - 353:
The mental activity of (a) theoretical [i.e., explanatory, speculative] contemplation directed toward some object with a view to reaching a propositional conclusion; or ( b ) practical deliberation directed toward some objet with a view to reaching a decision to act.
I found a longer entry about thinking in Volume 8 of The Encyclopedia of Philosophy, Reprint Edition (1972), pp. 100 – 103, which contains the following:
Thinking is an essentially human activity occurring in two basic forms. We may think in order to attain knowledge of what is, must, or may be the case; we may also think with a view to making up our mind about what we will or will not do. Following Aristotle, these two forms of thought may be called, respectively, contemplation and deliberation. Both forms may be carried on well or badly, successfully or unsuccessfully, intelligently or stupidly.
Despite their obvious shortcomings, I like those last two explanations, because I can relate them to things that contracting personnel do at work. For instance thinking about what evaluation factors to use in a source selection is deliberation. Thinking about what kind of thing an evaluation factor is and what kinds of evaluation factors there are is contemplation. Deliberation is practical. Contemplation is theoretical. You deliberate in order to decide what to do. You contemplate in order to understand and develop ideas.
So, what is thinking? (The definitions that I quoted are from lexicographers and philosophers. A psychologist might answer differently. See Thinking, Fast and Slow (2011), by Daniel Kahneman.) I believe thinking is a debate with yourself — a purposeful process of asking yourself questions about something and then trying to answer them. You ask, you answer, you challenge, you respond, and you decide, just you and yourself, in foro interno. For example: What is an evaluation factor? Answering entails definition, induction, analysis, classification, deduction, and argument. Each of those operations should be performed according to exacting standards of rigorous thought. You will get a different answer from other people. It is something to think about. But right now I like the contemplation/deliberation distinction and will run with it.
Contemplation and Deliberation
It seems to me that in order to deliberate well, you must contemplate first. You cannot deliberate well about what contract type to use until you first contemplate the concept of contract types until you understand what they are and how they are supposed to work. In order to do that you must read more than the summary descriptions in FAR Part 16 or in a set of PowerPoint slides. You must read the standard contract clauses peculiar to each type and think about how the clauses work together and with what results. You must then figure out how each contract type differs from the others. You must also contemplate contract type theory, which holds that the right distribution of cost risk “will provide the contractor the greatest incentive for efficient and economical performance.” Is that true? In order to contemplate contract type theory, you have to contemplate risk: What is it? What causes it? Can you measure it? If so, how? And on, and on. It’s never done.
In order to deliberate well a professional must have a head full of well developed professional ideas gained through contemplation, as many as possible. You will need them in your deliberations. Much deliberating is done in cooperation with others, and you can better communicate and be understood when your ideas are well-developed and deep, so that you can explain them clearly and answer questions.
Where do you get such ideas? You get them by going to school, reading, talking things over with colleagues, and, especially important, by going into a quiet corner and asking yourself questions and developing answers about the things that you have been taught, that you have read, that you have heard, and that you have worked out for yourself. It takes quite a lot of effort, and it takes a long time, a professional lifetime. It’s never done.
Understand Simple Things Deeply
According to The 5 Elements of Effective Thinking (2012) by Edward B. Burger and Michael Starbird, the first key to effective thinking is to master the fundamentals by understanding simple things deeply. “The most fundamental ideas in any subject can be understood with ever-increasing depth.” If asked to explain cost, as used in cost estimate, cost analysis, and should cost, what would you say? If asked to define cost on the spot, could you do it? A cost estimate is an estimate of what, exactly? How much and how good of an explanation could you give to someone who doesn’t know anything about it? How deeply could you go into that concept? Could you anticipate the inevitable questions? Could you answer them?
If you are a contract specialist, how much do you know about the concept of contract? Can you go beyond “an agreement that the courts will enforce” or offer, acceptance, mutual assent, consideration, competent parties, legal purpose, etc., or the definition in FAR 2.101? How long can you talk about What is a contract? Five minutes? Fifteen minutes? An hour? Longer? How much do you know about, and how deeply do you understand, the thing in which you specialize?
In his memo, the Under Secretary alludes to the importance of contemplation:
People. Thinking does not do much good if we do not have the professional preparation to think well. Policies and processes are of little use without acquisition professionals who are experienced, trained and empowered to apply them effectively. At the end of the day, qualified people are essential to successful outcomes and professionalism, particularly in acquisition leaders, drives results more than any policy change.
Contemplation is professional preparation for deliberation. Deliberation is the practical application of professional ideas to professional problems. You cannot deliberate well if you have not first contemplated well, and in order to contemplate well you have to put in a lot of work. And it’s never done.
The Perils of Deliberation without Prior Contemplation
What happens when you deliberate before you contemplate? Consider: The Department of Defense IG recently issued a report that is critical of the way DOD contracting personnel awarded and administered performance based payments (PBP). See DOD Inspector General Report No. DODIG-2013-063, Award and Administration of Performance Based Payments in DOD Contracts, April 8, 2013, and FAR Subpart 32.10, Performance Based Payments.
According to the DODIG:
DoD contracting personnel did not properly evaluate and negotiate PBP schedules. Specifically, for the 60 PBP schedules reviewed, they did not:
· establish appropriate events for 1,807 out of 2,356 events on 57 approved PBP schedules. This occurred because DoD guidance was inadequate and DoD contracting personnel needed specific PBP training. Therefore, DoD contracting personnel either misunderstood or were not aware of the FAR requirements for defining the performance events that allowed payment to the contractor. In the absence of thorough DoD policy and adequate training, contracting personnel did not scrutinize the contracts but accepted contractor-provided PBP schedules.
Italics added.
In order to award performance based payments (instead of progress payments based on costs), contracting officers must identify and select performance events (aka, milestones) and then pay contractors based on the predetermined value of the occurrence of the event. See FAR 32.1004(a)(1). FAR doesn’t explain the concept of an event, but says that contracting officers may not use as events such occurrences as (1) the signing of contracts or modifications, (2) the exercise of options, and (3) the mere passage of time.
Maybe what the DODIG found happened because the contracting personnel deliberated about what events to use before they had contemplated the concept of an event. Perhaps they did not ask and answer some basic questions:
· What is an event?
· What is a performance event in the context of performance-based payments?
· Are there different kinds of events and, if so, how many kinds are there, and what are the differences?
· Of the various kinds of events, which are appropriate to use as bases for performance based payments?
Perhaps they should have contemplated those matters and identified the attributes common to (1) the signing of contracts or modifications, (2) the exercise of options, and (3) the passage of time that make those events unsuitable. Then, when deliberating about what events to use, they could have made sure not to choose any that had those attributes.
Now consider this: Suppose that a source selection team must decide what evaluation factors to use. See FAR 15.304. The team sets to thinking about their choices, and decides to look at old RFPs for examples. They then choose certain ones and cut and paste. They don’t stop to ask themselves:
· What is evaluation?
· What is an evaluation factor?
· Are there different kinds of evaluation factors?
· If so, how do they differ from one another, and what is the significance of each of those differences to the tasks of proposal preparation and proposal evaluation?
If the agency’s acquisition personnel don’t devote some time to contemplating those things, if they cut and paste from old RFPs, they may end up making bad choices and being unsuccessful or less efficient and economical than they could have been in identifying the firm that offers best value. See Vernon J. Edwards, “Streamlining Source Selection by Improving the Quality of Evaluation Factors,” The Nash and Cibinic Report, October 1994.
Is Anyone Thinking?
How good are acquisition personnel at thinking? Do they contemplate before they deliberate, and do they contemplate and deliberate well? Are they professionally prepared to do those things, as the Under Secretary says that they must be in order for their thinking to be of any use and to have a good outcome?
Based on extensive personal experience in the classroom, I believe that acquisition personnel could do much better at professional level thinking. They are not alone in that. It is often asserted that today’s undergraduate education does not prepare students to think well. The private sector has long recognized this problem. See “Executives to new grads: Shape up!” by Anne Fisher, accessible on line at CNNMoney:
http://management.fo...grads-shape-up/
In all, a 65% majority of business leaders say young people applying for jobs at their companies right out of college are only "somewhat" prepared for success in business, with 40% of C-suite executives saying they are "not prepared at all." Not only that, but even those who get hired anyway may not rise very far. Almost half (47%) of C-suite executives believe that fewer than one-quarter (21%) of new grads have the skills they'll need to advance past entry-level jobs.
And what skills might those be? The most sought-after are problem-solving (49% ranked it No. 1), collaboration (43%), and critical thinking (36%). Also in demand is the ability to communicate clearly and persuasively in writing (31%). Technology and social media skills came in at rock bottom on the list, valued highly by only a tiny 5% minority of senior managers. The kicker: According to the poll, new grads fall far short of the mark in every one of these areas -- except tech savvy, the least desired.
See also “What are most students learning in college? Not enough, study says,” by Sara Rimer in The Hechinger Report, January 18, 2011:
http://hechingerrepo...udy-says_4979/.
Many public and private universities and some institutions of professional military education offer courses about thinking. Harvard even has a course called “Thinking about Thinking.” The National Defense University, in conjunction with the Defense Acquisition University, offers a two part, two semester course entitled, Critical Thinking and Decision Making in Defense Acquisition, ICAF 6152-1 and 6153-1, but it is available only to those who already have a Level III certification and who are enrolled in the Senior Acquisition Course. If thinking is so important in acquisition, why isn’t there a course more widely available for those in earlier phases of their professional development? Why wait until someone is a decision maker to offer them such training? Many mature students have complained to me that they didn’t get the right kinds of training early enough in their careers. Why is that so?
Assuming that acquisition personnel know what thinking is and are able to do it well, do they have enough time to think, given their professional workload and their reporting, data entry, and other clerical duties? Do they have enough administrative and clerical support?
The workload has been crushing over the last decade, and the rules keep getting more and more complex. In October 1995, the rule in FAR 16.505( b ) governing the multiple award task order contract “fair opportunity” process was 565 words long. By May 2012 the rule had grown to 2,203 words. There was a similar development in the rule in FAR Subpart 8.4 governing the placement of orders against GSA Federal Supply Schedule contracts. That kind of development means more work to process a contract action. Also, the issuance of new reporting requirements has become practically routine. Administrative and clerical support is virtually nonexistent, yet, every year, Congress and senior officials in the Executive Branch pile more reporting and data entry tasks onto the shoulders of contracting personnel. I believe that I know what a random sample of GS-1102s would say if asked whether they have enough time to think deeply about anything at work.
Think! Really?
Thinking, however, can produce troublesome thoughts, and I wonder if the Under Secretary realizes what he has asked for and, if so, whether he means it. What if people begin to think and their thinking leads them to question fundamental tenets of acquisition dogma? For example, what if contemplation leads them to question the efficacy of proposal-based competition for development contracts? What if they argue that such competitions encourage the submission of inflated promises and foster unrealistic expectations? What if they begin to question the utility of contract incentives and to argue that they cost more to plan and administer than they yield in terms of reductions in cost and improvements in performance?
Will such thinkers be welcomed and their thoughts given serious consideration? Or will they face professional “excommunication” and see their thoughts rejected out of hand? How open will the higher ups be to their ideas? Will they encourage and support such thoughts?
Consider the DOD Source Selection Procedures issued under the previous Under Secretary on March 4, 2011:
http://www.acq.osd.m...183-10-DPAP.pdf
These procedures are effective July 1, 2011, and are mandatory for all competitive acquisitions using FAR Part 15 procedures. All requests for proposals (RFPs) issued after July 1. 2011, are subject to these procedures.
Italics added. “All” -- no exceptions. Waivers require the “express permission” of the Director of Defense Procurement. In short: Don’t think. We’ve already done the thinking. Just do what we say. Use the standardized rating tables, whether they make sense in your case or not, whether or not you think there is a better scheme. That’s ironic in light the Under Secretary’s memo: “Our workforce should be encouraged by leaders to think and not to automatically default to a perceived school solution just because it is expected to be approved more easily.”
Yet, we need thinkers in acquisition, and good ones. I recently read the following in “Education for Critical Thinking,” by Col. Thomas M. Williams, in Military Review, January-February 2013, pp. 49- 54:
[W]ar is about identifying and solving ill-defined problems where experts can and do disagree on the range of solutions. In this operational environment, leaders have to prepare themselves to do more than apply doctrine and follow rules. Army doctrine — Mission Command — welcomes this possibility and gives us license to be unorthodox if the situation warrants. Army Doctrinal Reference Publication (ADRP) 6-0 states that it is “a guide for action rather than a set of fixed rules,” adding that effective leaders know when the doctrine or training experience and experience no longer apply, when they must adapt. This is not a legal indemnification; it is a call for honest critical thinking.
Substitute acquisition for “war” and “operational,” and I think his statement applies equally well to the work of acquisition professionals.
Acquisition is a squishy field. While there are acquisition laws, regulations, and dogma, to be sure, most of the big problems involve fuzzy logic, and experts can and do disagree about solutions. Critical thinking is an essential skill. So it makes sense that the Under Secretary demands that DOD acquisition professionals think, but it is ironic that his office has issued directives like the source selection memo.
I wonder whether the Under Secretary is serious about wanting acquisition personnel to think. If he is serious, I wonder what he is going to do about it. A memo isn’t an accomplishment. Is it? Well, is it?
↧
Just do it!
This morning I came across an article of Department of Defense news dated June 4, 2013, with the headline: “People at Center of Defense Acquisition Process, Official Says.” It describes an interview with the Assistant Secretary of Defense for Acquisition in which that official emphasized that people are at the heart of the Better Buying Power 2.0 program. You should read it, even if you don't work for DOD. You can access it here:
http://www.defense.gov/News/NewsArticle.aspx?ID=120204
The interviewee makes the de rigueur observation that the acquisition workforce was “decimated” and “downsized horrendously” during the 1990s, and that during the 2000s the emphasis was on spending money to meet the needs of the warfighter. Supposedly, the Better Buying Power initiative has changed all that. Now there is a “huge effort” to ensure that the workforce thinks and that it has the professional “tools and training” it needs. Right. Note that the interviewee did not describe one specific thing that has been or is being done to accomlish that goal. Not. One. Thing.
The interviewee said that acquisition is a “team sport” and “leaders” are needed. I agree. When will they get here? Henry V made a great speech at Agincourt, but then he fought.
http://www.defense.gov/News/NewsArticle.aspx?ID=120204
The interviewee makes the de rigueur observation that the acquisition workforce was “decimated” and “downsized horrendously” during the 1990s, and that during the 2000s the emphasis was on spending money to meet the needs of the warfighter. Supposedly, the Better Buying Power initiative has changed all that. Now there is a “huge effort” to ensure that the workforce thinks and that it has the professional “tools and training” it needs. Right. Note that the interviewee did not describe one specific thing that has been or is being done to accomlish that goal. Not. One. Thing.
The interviewee said that acquisition is a “team sport” and “leaders” are needed. I agree. When will they get here? Henry V made a great speech at Agincourt, but then he fought.
↧
Barney Klehman
Barney Klehman, my friend of more than 30 years, died yesterday at his home. His office called to tell me. I was working outside when the call came. I knew something was wrong when I saw the look on my wife’s face as she came outside. She said Barney’s office had called with news. I was apprehensive when I went to the phone, because I was always worried about Barney’s health. I felt two ways when I was told: like a ton of bricks had fallen on me and suddenly empty inside. I kept thinking: You mean, I won’t see him again? Not ever again? Barney?
We’d had dinner in Arlington, Virginia with two other old friends the week before, and the week before that he and I had dined in Huntsville, Alabama. It didn’t seem possible. It didn’t compute. But I knew it was true. I had worried about the possibility of just this.
Barney had a close circle of intimate friends who had all worked together for the Air Force in El Segundo, California, at the Space & Missile Systems Organization (SAMSO), since the 1970s. I met him one summer when we both played on the contracting office softball team. He played softball the same way that he worked: passionately, with knowledge and skill, and with an it ain’t over ‘till it’s over commitment to success.
That commitment took him a long way. He started out working for the old Defense Contract Administration Service in Pasadena, California. Then went to SAMSO in the Air Force Systems Command. When he died he was an SES, Director of Acquisition for the Missile Defense Agency. In the course of his long career he worked on many programs and trained and mentored a lot of young contracting folks. You were very lucky if you got to work for Barney Klehman, because he cared about you and was devoted to your education and development. In return, you had to show that you cared, because Barney didn’t have much use for people who do not care and will not strive.
Even though we were both very opinionated and passionate about our work, I don’t recall us ever being angry at each other, although we sometimes did disagree. Many a disagreement ended with one of us saying, Hmm, I hadn't thought of that, or Yeah, okay, that’s right. You’re right. But we didn’t talk just work. We also talked sports (he knew a lot more than I) and life.
Barney had one fault that bothered all of his friends: He took better care of other people and of his work than he did of himself, which is why I worried about him. He did not take care of his health. Everybody complained to him about it and he always agreed, but he didn’t follow through. When I called one old friend to give him the news, he was shocked, I can’t believe this! and then furious, Blank-blank it! He didn’t take care of himself! We told him he had to take better care of himself!
Telephone calls throughout the day. Emails late into the night. Expressions of shock and grief. One friend sent us an email with photos of Barney through the years. I was glad to get those photos, they break my heart, but I can't stop looking at them.
The notice sent out by Vice Admiral Syring, Director of the Missile Defense Agency, said:
Yes, that’s true. But what will stick with me is this one, that came in an email yesterday from a woman who had worked for him: “Barney was one of the kindest men I’ve ever known.”
There it is. One of the truest and best epitaphs I’ve ever read. That was Barney.
He was what the Irish call a darlin’ man.
Amicus vitae solatium. Amicus animae dimidium.
We’d had dinner in Arlington, Virginia with two other old friends the week before, and the week before that he and I had dined in Huntsville, Alabama. It didn’t seem possible. It didn’t compute. But I knew it was true. I had worried about the possibility of just this.
Barney had a close circle of intimate friends who had all worked together for the Air Force in El Segundo, California, at the Space & Missile Systems Organization (SAMSO), since the 1970s. I met him one summer when we both played on the contracting office softball team. He played softball the same way that he worked: passionately, with knowledge and skill, and with an it ain’t over ‘till it’s over commitment to success.
That commitment took him a long way. He started out working for the old Defense Contract Administration Service in Pasadena, California. Then went to SAMSO in the Air Force Systems Command. When he died he was an SES, Director of Acquisition for the Missile Defense Agency. In the course of his long career he worked on many programs and trained and mentored a lot of young contracting folks. You were very lucky if you got to work for Barney Klehman, because he cared about you and was devoted to your education and development. In return, you had to show that you cared, because Barney didn’t have much use for people who do not care and will not strive.
Even though we were both very opinionated and passionate about our work, I don’t recall us ever being angry at each other, although we sometimes did disagree. Many a disagreement ended with one of us saying, Hmm, I hadn't thought of that, or Yeah, okay, that’s right. You’re right. But we didn’t talk just work. We also talked sports (he knew a lot more than I) and life.
Barney had one fault that bothered all of his friends: He took better care of other people and of his work than he did of himself, which is why I worried about him. He did not take care of his health. Everybody complained to him about it and he always agreed, but he didn’t follow through. When I called one old friend to give him the news, he was shocked, I can’t believe this! and then furious, Blank-blank it! He didn’t take care of himself! We told him he had to take better care of himself!
Telephone calls throughout the day. Emails late into the night. Expressions of shock and grief. One friend sent us an email with photos of Barney through the years. I was glad to get those photos, they break my heart, but I can't stop looking at them.
The notice sent out by Vice Admiral Syring, Director of the Missile Defense Agency, said:
“Barney was a true professional with more than four decades of extensive contracting and acquisition leadership experience across the Air Force and Joint DoD Community. Beginning his federal service career in 1972 as a contract price analyst with what is now the Defense Contract Management Agency, he served in leadership positions in multiple program offices before joining the Missile Defense Agency in 2004. Barney dedicated his life to helping others grow professionally, and he was a passionate mentor and friend to many people throughout the Agency and DoD.”
Yes, that’s true. But what will stick with me is this one, that came in an email yesterday from a woman who had worked for him: “Barney was one of the kindest men I’ve ever known.”
There it is. One of the truest and best epitaphs I’ve ever read. That was Barney.
He was what the Irish call a darlin’ man.
Amicus vitae solatium. Amicus animae dimidium.
↧