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PBSA Update and Best Practices

PBSA Update and Best Practices. Lyle Eesley Director, Learning Center of Excellence for Service Acquisition Defense Acquisition University Lyle.Eesley@DAU.Mil 4 Aug 2008 2:00 – 3:00pm. Overview. Service Acquisition Policy Updates Best Practices

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PBSA Update and Best Practices

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  1. PBSA Update and Best Practices Lyle Eesley Director, Learning Center of Excellence for Service Acquisition Defense Acquisition University Lyle.Eesley@DAU.Mil 4 Aug 2008 2:00 – 3:00pm

  2. Overview • Service Acquisition Policy Updates • Best Practices • Performance Based Service Acquisition works • Service Acquisition Mall update • Service Acquisition Workshop provides your service Acquisition Team with a roadmap for success

  3. Policy Issues • FY 2008 National Defense Authorization Act • Section 807 Annual inventories and review of contracts for services • Section 324 FY 2008 NDAA “In-sourcing vs Outsourcing debate”

  4. Changes coming to DODI 5000 • Current DODI 5000.2 • 1.3. Establishes a simplified and flexible management framework for translating mission needs and technology opportunities, based on approved mission needs and requirements, into stable, affordable, and well-managed acquisition programs that include weapon systems and automated information systems (AISs). • Draft DODI 5000.02 • 1.2. Establishes a simplified and flexible management framework for translating capability needs and technology opportunities, based on approved capability needs, into stable, affordable, and well-managed acquisition programs that include weapon systems, services, and automated information systems (AISs). • Significant expansion of Enclosure 8 dealing with service contracts addresses Section 807 requirements

  5. New COR training and “certification standards” coming • Expect significant changes in near future • 46 Hours of training, combination of classroom(36) and on line (8) • Appointed and trained before contract award • Certification needed based on complexity of contract assigned

  6. Performance Based Service Acquisition works! Navy needed Reliable AC tire delivery • Goal: • Aircraft Tire Delivery • 48 hrs CONUS • 96 hrs OCONUS • 95% on time

  7. Aircraft Tires PBL Contract Performance 1000 requisitions per month...3K tires per month • Goal is 95% on time • 48 hrs CONUS • 96 hrs OCONUS • Record: • Not one backorder (100% fill rate) • ACWT CONUS: 32 hrs 53 mins • ACWT OCONUS: 58 hrs 31 mins • Wholesale & Retail inventory levels dropping • Taking cost out %

  8. Navy Tires PBL • Benefits to Navy • $3M / year in supply chain management savings • Reduction from approximately 1.5 years wholesale inventory to 3 months • Reduction from 60 days to 15 days retail inventory at all CONUS Naval Air Stations • Response times reduced to 2 days in US, 4 days OCONUS • On-time delivery improvement from 81% to 99+% • Saving the Navy more than $49M over the life of the contract

  9. Service Acquisition Mall Update • Integrates Process Knowledge and Learning assets with Product Service Code specific information • Aligns service types with DPAP Service Portfolios • Utilizes sourcing process contained in Service Acquisition Workshop and ACQ 265 • Concept demonstrator development effort ready for contract award SAM

  10. Enter SAM thru ACE for Services Site located on DAU’s ACC https://acc.dau.mil/ace Click on the SAM SAM Enter Here

  11. Service Acquisition Mall Directory Help Desk Enter your PSC Code :_______ To look up PSC code click on PSC Group below (Until the SAM is built, you can go to Web site to find PSC codes) www.usabid.com/resources/tables/pscs Suggestion Box

  12. If you’re planning or researching an Aircraft Maintenance service requirement, the PSC code is J015. Entering J015 takes us to the J015 Store “Stores” have “Managers” that ensure shelves are stocked with relevant, quality information, learning assets and best in class samples, examples, market research, metrics, business strategies, etc. The Mall uses a seven step sourcing process to create a Requirements Roadmap for acquisition teams to follow JO 15 Aisles of Information

  13. Service Acquisition Mall (SAM) Integrates Process Knowledge and Learning assets with Product Service Code specific information Mission Need Step 1 Step 2 Step 3 Requirements Roadmap Mission Results Step 7 Step 4 Step 5 Step 6 Standards AQL* Inspection Incentive Objective JO15 Store Steps in the Sourcing process and Sub elements Clicking on any of the step boxes 1 thru 7 will display the step sub elements of that step, with learning assets associated with each sub element Feedback and Suggestions Samples and Examples Aisle Training Aisle Coach Aisle Sam’s U Tube Aisle Video or MP3 audio file Roadmap Process Knowledge PSC Knowledge Tool Aisle Each topic box has a pull down menu for content

  14. Mission Need Step 1 Step 2 Step 3 Requirements Roadmap Mission Results Step 7 Step 4 Step 5 Step 6 Standards AQL* Inspection Incentive Objective Step 3: Market Research JO15 Store • Step 3: Process sub elements • Take a team approach • Determine data sources • Develop interview guide • Conduct Marker Research • RFI from service providers • Analyze Market for emerging • suppliers • Analyze Market Research • Document Market Research and trends Feedback and Suggestions Samples and Examples Aisle Training Aisle Coaches Aisle Sam’s U Tube Aisle New Topic Aisles may appear based on your step in the process Commercial Practices & Metrics from Airlines, Freight, Charter companies Government Samples & Metrics DOD, NASA, USCG, Other Market Research Reports Interview Guide Market Research Sourcing Options Aisle Tool Aisle Existing Contracts DOD, Non DOD Strategic Sourcing Options 14

  15. Your opportunity to build the foundation • As we move forward with SAM we Need • Your ideas • Your experience • Your commitment • Why? • Stock the shelves with Good examples, market research, business strategies and roadmaps for all to use

  16. The Challenge: Getting the Acquisition Started ! • Lack of an experience workforce complicates our service acquisitions • Often falls to a scratch team to plan and execute service acquisition efforts • How can you get an acquisition team trained and started on their acquisition at the same time? • Answer - Service Acquisition Workshop

  17. Service Acquisition Workshop • Just in time, intact team training • 4 Days in length • Requires participation of all key members of acquisition team • Targeted for specific acquisition team as they start the sourcing process • Special focus how to develop performance based business strategies, requirements and assessment strategies using Requirements Roadmap process • Works team through the seven step sourcing process PWS SAW

  18. Seven Step Sourcing Model Form the Team • Leadership Support • Build the Team Mission Requirement for Supply or Service starts the process 1 Users Stakeholders QA Reps Proj. Mgr Sourcing Team PCO CORs Tech Buyers SB Resource Mgt PEOs Legal

  19. Seven Step Sourcing Model Review Current Strategy Form the Team • Conduct Historical Analysis • Define Stakeholder & Customer needs • Leadership Support • Build the Team 2 Mission Requirement for Supply or Service starts the process 1 Users Stakeholders QA Reps Proj. Mgr Sourcing Team PCO CORs Tech Buyers SB Resource Mgt PEOs Legal

  20. Requirements Roadmap Process Step Two identifies Key Stakeholder and Customer high level desired outcomes. • Acquisition Vision • Stakeholder Desired Outcomes • A… • B… • - C… Identified and validated during discussions and interviews with Key Stakeholders and Customers

  21. Seven Step Sourcing Model Review Current Strategy Form the Team • Conduct Historical Analysis • Define Stakeholder & Customer needs • Leadership Support • Build the Team Market Research • Analyze Market • Identify suppliers 2 Mission Requirement for Supply or Service starts the process 1 3 Users Stakeholders QA Reps Proj. Mgr Sourcing Team PCO CORs Tech Buyers SB Resource Mgt PEOs Legal

  22. Critical Factor: Effective Market Research MARKET DATA Collected Assess from many angles New technologies Pricing/Value Comparisons Competition Market Trends (Supply/Demand) Small Business Opportunities Market Leverage Performance Metrics Compare/Contrast to Needs Conduct MARKET ANALYSIS Whole Team: review and assess opportunities from analysis Market Research Report Business Case for Change

  23. Seven Step Sourcing Model Review Current Strategy Form the Team Requirements Roadmap • Conduct Historical Analysis • Define Stakeholder & Customer needs • Leadership Support • Build the Team Incentive Objective Standards AQL Inspection Market Research • Analyze Market • Identify suppliers Requirements Definition • Define Requirement • Draft Business Strategy 2 Mission Requirement for Supply or Service starts the process 1 3 Users Stakeholders QA Reps Proj. Mgr Sourcing Team 4 PCO CORs Tech Buyers SB Resource Mgt PEOs Legal

  24. Seven Step Sourcing Model Review Current Strategy Form the Team • Conduct Historical Analysis • Define Stakeholder & Customer needs • Leadership Support • Build the Team Market Research • Analyze Market • Identify suppliers Requirements Definition • Define Requirement • Draft Business Strategy Sourcing Strategy • Strategic or Tactical • Business Strategy 2 Mission Requirement for Supply or Service starts the process 1 3 Users Stakeholders QA Reps Proj. Mgr Sourcing Team 4 PCO CORs Tech Buyers SB Resource Mgt PEOs Legal 5

  25. Seven Step Sourcing Model Review Current Strategy Form the Team • Conduct Historical Analysis • Define Stakeholder & Customer needs • Leadership Support • Build the Team Market Research • Analyze Market • Identify suppliers Requirements Definition • Define Requirement • Draft Business Strategy Execute Strategy • Select Right Contractor • Award Contract • Roll out strategy Sourcing Strategy • Strategic or Tactical • Business Strategy 2 Mission Requirement for Supply or Service starts the process 1 3 Users Stakeholders QA Reps Proj. Mgr Sourcing Team 4 PCO CORs Tech Buyers SB Resource Mgt PEOs Legal 5 6

  26. Seven Step Sourcing Model Review Current Strategy Form the Team • Conduct Historical Analysis • Define Stakeholder & Customer needs • Leadership Support • Build the Team Market Research • Analyze Market • Identify suppliers Performance Management Requirements Definition • Build & Manage Relationship • Monitor Performance • Define Requirement • Draft Business Strategy Execute Strategy • Select Right Contractor • Award Contract • Roll out strategy Sourcing Strategy • Strategic or Tactical • Business Strategy 2 Mission Requirement for Supply or Service starts the process 1 3 Users Stakeholders QA Reps Proj. Mgr Sourcing Team 4 PCO CORs Tech Buyers SB Resource Mgt PEOs 7 Legal 5 6

  27. Seven Step Sourcing Model Review Current Strategy Form the Team • Conduct Historical Analysis • Define Stakeholder & Customer needs • Leadership Support • Build the Team Market Research • Analyze Market • Identify suppliers Performance Management Requirements Definition • Build & Manage Relationship • Monitor Performance • Define Requirement • Draft Business Strategy Execute Strategy • Select Right Contractor • Award Contract • Roll out strategy Sourcing Strategy • Strategic or Tactical • Business Strategy 2 Mission Requirement for Supply or Service starts the process 1 3 Users Linkage Stakeholders QA Reps Proj. Mgr Sourcing Team 4 PCO Mission Results for 1. Warfighter 2. Customer 3. Taxpayer CORs Tech Buyers SB Resource Mgt PEOs 7 Legal 5 6

  28. Requirements Roadmap Process Tailoring and completing a “Roadmap” focuses the acquisition team on the essential performance and assessment elements Provides foundation for the PWS development, best value strategy and contract admin approach. Requirements Roadmap Incentive Objective Standards AQL Inspection • The “Roadmap” is the • “Get er Done” tool teams • use to develop their • performance work statement (PWS)

  29. Requirements Roadmap Worksheet Requirements Roadmap Worksheet Performance Inspection Incentive Type Desired Outcome Standard and Measure Data Source Calculation How Often Collected Who Objective AQL A…. A -1 A -2 A -3 A -3 a A -3 b B…. B -1 B -2 • Define each performance objective that must be achieved to deliver the desired performance outcome established at step 2 • What Performance Standard is required and an acceptable or allowable deviation • Who and How will we measure this performance area, outcomes must be measurable • What, if any, incentive may be applied to this performance element 29

  30. Identify Performance Objectives needed to achieve desired outcomes Acquisition Vision Desired Outcomes - A….. - B….. - C…. Requirements Roadmap Worksheet Performance Inspection Incentive Type Desired Outcome Standard and Measure Data Source Calculation How Often Collected Who Objective AQL Alignment A…. A -1 A -2 A -3 A -3 a A -3 b B…. B -1 B -2 30

  31. Requirements Roadmap Process Meaningful Performance Objectives must answer the question WHY the performance is needed Performance objectives are clear, objective statements using Nouns and Verbs Requirements Roadmap Standards Inspection Objective Incentive AQL*

  32. FAR Subpart 37.601 Defines a Performance-Based Service Contract 1) Describe the requirements in terms of results required rather than the methods of performance of the work (i.e., “what,” rather than “how”) 2) Use measurable performance standards (i.e., terms of quality, timeliness, quantity, etc.) and quality assurance surveillance plans 3) Specify procedures for reductions of fee or for reductions to the price of a fixed-price contract when services are not performed or do not meet contract requirements (i.e., negative incentives); and 4) Include (positive) performance incentives where appropriate 32

  33. Develop the Requirements Roadmap Worksheet Performance Standards describe what level of performance must be met to satisfy the Performance Objective You must be able to know what performance level is needed Standards enable us to know when and therefore must be measurable Standards are where you add the adverbs and adjectives Requirements Roadmap Standards Inspection Objective Incentive AQL

  34. Develop the Requirements Roadmap Worksheet An AQL is an acceptable deviation from the standard However, the contractor is still expected to meet the standard What should you address to determine if an AQL is appropriate? Will it still achieve my performance objective Easily understood Clearly delineated Requirements Roadmap Standards Inspection Objective Incentive AQL

  35. Requirements Roadmap Example 35

  36. Develop the Requirements Roadmap Worksheet Inspection approaches verify if standards are being met The verification responsibility rests with the buyer Some typical Inspection methods Continuous, in instances where the service is ongoing and observation is almost constant 100%, of such things as reports, or logs Customer feedback Random sampling Requirements Roadmap Standards Inspection Objective Incentive AQL • Answer this question: “HOW will I know if the standard is being met? • Answer = Inspection

  37. Develop the Requirements Roadmap Worksheet “What happens if a standard is not met?” This question should guide your approach to inspection Do you have the resources to inspect? Who will perform the inspections Where will the data come from How will it be calculated How often do you need to collect the information Resources impact what you are capable of inspecting Do you have the technology to inspect Is it inspectable?....You must ‘test the testing’ Requirements Roadmap Standards Inspection Objective Incentive AQL

  38. Develop the Requirements Roadmap Worksheet Once the inspection process has been determined, the incentives must be need to be established. What are the impacts of meeting or not meeting the standards of the objectives? Incentives can be negative or positive Past Performance Assessments should always be included in the incentive portion of the Requirements Roadmap Incentives can take the form of deducts; reduced inspections; be tied to award fee or performance incentive fee plans; or shared cost savings Requirements Roadmap Standards Inspection Objective Incentive AQL

  39. Develop the Requirements Roadmap Worksheet Requirements Roadmap Standards Inspection Objective Incentive AQL 60% • Now step back and determine which performance objectives carry the most importance • Objectives with greater importance should receive proportionateweighting in the incentive column. • This also applies to past performance assessment • Use the weights assigned to the incentives and relate them back to the performance objectives • This provides the starting point for weighting the Technical Evaluation Plan (TEP) factors which builds section M of the RFP 20% 20%

  40. Summary: Requirements Roadmap provides the Linkage Requirements Roadmap Worksheet Incentive Objective Standards AQL Inspection Acquisition Vision Desired Outcomes - A….. - B….. - C…. Contract Line Item structure for RFP Evaluation Factor weightings for Section M of RFP Quality Assurance Surveillance Plan Performance Work Statement or SOO

  41. Requirements Roadmap Process Summary Requirements Roadmap Worksheet Incentive Objective Standards AQL Inspection Make the Performance jump Start with Old SOW Final PWS Alignment NOW write Final PWS Ask WHY…. Yields Performance Objective Performance Objective Inspection Approach Ask WHAT ….. Yields Performance Standard (Level) Ask HOW….. Yields Inspection approach Performance Standard WHY………….WHAT……………HOW………….NOW

  42. Summary More policy focused on service acquisition is coming Performance Based Services are successfully meeting mission needs and saving Warfighter resources Service Acquisition Mall and Service Acquisition Workshops will share knowledge and training resources to better assist the workforce Stay tuned for upcoming NCMA Audio Workshops on Performance Based Service Acquisition

  43. Backup information on Metrics

  44. Critical Few Metrics How many metrics are enough? Too few Not capturing detail required to manage business Too many Choked with data Rule of 5 No more than 3 - 5 key metrics at the contract level 44

  45. Metrics Have To Be Aligned A critical few KPIs will track progress toward strategic objectives KPI Key Performance Indicator PROCESS MEASURES However, there will be a few that roll up to become process measures RESULTS MEASURES All of the operational measures are necessary

  46. Metrics Have To Be Aligned Perfect Order KPI Process Measures On Time Complete Damage Free Correct Docs Results Measures On Time Order Management On Time Order Fill On Time Transportation

  47. Example Requirements Roadmap This would be a results measure because it is needed……but not critical This would be a KPI because it is so critical 47

  48. Program AssessmentBase… Contract Level KPI performance Metrics briefed to Wing Commander monthly Current assessment of: Budget Execution (Spend Plan) Contractor Cost Management Technical Performance Management Schedule

  49. Vehicle In Commission QPI Goal 90% Metric 29: Vehicle In Commission Rate 27. Air Crew Taxi This is a results measure supporting the transportation process measure Percent GOOD

  50. Performance Outcome Measure Summary Satisfactory - PMF evaluation determined the outcome results were met. Marginal - PMF evaluation determined outcome results were not met after a previous notice of deficiency was issued as long as deficiency is not related to safety, security, protection of resources or law. Unsatisfactory – PMF evaluation determined outcome results were not met after previously being rated Yellow or, evaluation identified a situation which violated safety, security, protection of resources or law. Not Accomplished – A scheduled evaluation was not completed. Performance Not Required This Month – No activity required by CSC on these items. No Monthly Evaluation Scheduled – Item frequency does not require an evaluation for this month. In Progress – Cannot be accomplished until after end of month.

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