REQUEST: In support of a PSC research paper that David Berteau will present at the Naval Post Graduate School’s 21st Annual Acquisition Research Symposium in May 2024, we are seeking your company’s timely feedback on survey questions (below). We would appreciate your response by Monday, March 11, 2024.
Note: We estimate that this survey will take [10-15] minutes to complete. PSC staff will ensure that all responses are aggregated and anonymized; no identifying information will be used (for either an individual or a company).
BACKGROUND: PSC’s paper will explore the intersection of cost realism, competition, and solicited versus executed requirements, as outlined in the below abstract. Although this paper will be presented to Department of Defense senior officials, PSC recognizes this issue is not isolated to the DoD. We anticipate the opportunity to identify how broadly this issue persists across the Federal Government space, and how damaging these scenarios can be to the depth and breadth of the government contracting industrial base. Thank you in advance for your time and support, and as always, please reach out with any questions.
RESEARCH ABSTRACT (as submitted to NPS): When done well, accurate cost realism analyses are highly effective at identifying material and substantive discrepancies between competitive offerors, as well as “buying in” or collusive behaviors; these analyses can also support a full and accurate responsibility determination prior to award. However, a worrying trend has emerged in the award of professional support services requirements, reflecting a disconnect between the workforce requirements (“skill mix”) solicited and the workforce requirements executed after award. This disconnect effectively eliminates the value of cost or pricing analyses conducted prior to award. Specifically, marked inconsistencies between the solicited and evaluated skill mix during source selection and the actual programmatic requirement delivered to support the mission are creating a de facto “Lowest Price Technically Acceptable” acquisition environment. This trend has the potential to drive unreasonable competitive behaviors, increase financial responsibility risk, limit a company’s ability to innovate and invest in future capabilities, and drive competitors from the market. These factors and the quality of cost realism analyses must be examined more closely to clarify the disconnects and impacts between program officers, contracting officers, and companies, yielding a more stable relationship between industry and government.
Note: We estimate that this survey will take [10-15] minutes to complete. PSC staff will ensure that all responses are aggregated and anonymized; no identifying information will be used (for either an individual or a company).
BACKGROUND: PSC’s paper will explore the intersection of cost realism, competition, and solicited versus executed requirements, as outlined in the below abstract. Although this paper will be presented to Department of Defense senior officials, PSC recognizes this issue is not isolated to the DoD. We anticipate the opportunity to identify how broadly this issue persists across the Federal Government space, and how damaging these scenarios can be to the depth and breadth of the government contracting industrial base. Thank you in advance for your time and support, and as always, please reach out with any questions.
RESEARCH ABSTRACT (as submitted to NPS): When done well, accurate cost realism analyses are highly effective at identifying material and substantive discrepancies between competitive offerors, as well as “buying in” or collusive behaviors; these analyses can also support a full and accurate responsibility determination prior to award. However, a worrying trend has emerged in the award of professional support services requirements, reflecting a disconnect between the workforce requirements (“skill mix”) solicited and the workforce requirements executed after award. This disconnect effectively eliminates the value of cost or pricing analyses conducted prior to award. Specifically, marked inconsistencies between the solicited and evaluated skill mix during source selection and the actual programmatic requirement delivered to support the mission are creating a de facto “Lowest Price Technically Acceptable” acquisition environment. This trend has the potential to drive unreasonable competitive behaviors, increase financial responsibility risk, limit a company’s ability to innovate and invest in future capabilities, and drive competitors from the market. These factors and the quality of cost realism analyses must be examined more closely to clarify the disconnects and impacts between program officers, contracting officers, and companies, yielding a more stable relationship between industry and government.