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A Presentation to NCMA Pentagon

A Presentation to NCMA Pentagon. The Status of Better Buying Power. 8 September 2011. Better Buying Power Results. Promote Real Competition Improve Tradecraft in Acquisition of Services Quality of the Deal. Promote Real Competition. What we’ve done:

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A Presentation to NCMA Pentagon

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  1. A Presentation toNCMA Pentagon The Status of Better Buying Power 8 September 2011

  2. Better Buying Power Results Promote Real Competition Improve Tradecraft in Acquisition of Services Quality of the Deal

  3. Promote Real Competition What we’ve done: • Provided guidance for the development of Competition Strategies for review • Issued Departmental Guidance to conduct negotiations with all single bid offers based on cost or price analysis and using non-certified data • Clarified guidance on 30 day re-advertisement on one offer • Promulgated a maximum practicable opportunity analysis tool to help Components achieve small business goals What we are doing: • Requiring PEOs and PMs to present their strategy to create and maintain a competitive environment for their contractors at DAB and DAES reviews • Disseminating best practices to optimize small business participation across DoD • Modifying BBP guidance on 3 year re-competition requirement • Increasing emphasis on Mentor Protégé program and exploring other mechanisms for more non-traditional suppliers • Using the Peer Review Process to ensure that negotiated prices are fair and reasonable • Implementing open systems architectures and defining operational guidance for acquisition of data rights Measures of success: • The number of programs presenting competitive strategies at each Milestone • The increase in the number of small businesses and more "non-traditional" DoD suppliers to expand competition • The impacts on program cost resulting from the increased use of small businesses • Improvement rate of 2% per year for overall competition • Improvement rate of 10% per year for effective competition • Evidence of competitive strategies at DAB and DAES reviews • Reduced average time to field products/capabilities • Service examples of the successful use of open architecture and buying of data rights

  4. Improve Tradecraft in Acquisition of Services What we’ve done: • Established senior mgr for acquisition of services and holding monthly meetings with component senior managers and DPAP • Issued Directive detailing specific implementation guidance for the effort to standardize service taxonomy • Required OSD Office of Small Business Programs to review acquisition plans for services acquisitions exceeding $1B, and to be members of the OSD peer reviews of services acquisitions • Developed guidance for establishing a taxonomy of preferred contract types in services acquisition • Employed standard templates for developing Performance Work Statements to improve contract performance What we are doing: • Encouraging the use of Multiple Award/IDIQ contracts among small businesses, where suitable • Establishing market research teams within the senior manager for services construct at the portfolio manager level to understand industry’s capabilities • Developing tools to assist requirements developers in creating better service contracting requirements Measures of success • Increased use of CPFF and CPIF contracts in services acquisition when no previous competition exists, with evidence of knowledge gained informing future "Should Cost" estimates • Increased use of FFP contracts when competition already exists • Percentage of service contracts exceeding $1B that contain cost efficiency objectives • Percentage of multiple award service contracts exceeding $1B that are set aside for small business • Percentage of “one-bid” contracts relative to overall contracts and availability of fully negotiated pricing and cost data • Component categorization of service acquisition spend, with year-to year trend data

  5. Quality of the Deal What we’ve done: • Increased the use of FPI contract vehicles where appropriate • Taken advantage of highly productive acquisition strategy opportunities (i.e., LCS) • Asked Congress for block buy authorization for some programs • Issued guidance on progress payments of Fixed Price contracts • Published Cash Flow model for other than customary progress payments • Developed plan for collecting data/initiating pilot to improve industry IRAD return on investment What we are doing: • Working with industry to define win-win arrangements to drive productivity gains • Developing other opportunities for more efficient acquisition strategies (e.g., missile systems) • Holding production rates at economic levels (e.g. SDB II) • Challenging programs that are not affordable at economic rates • Reviewing Weighted Guidelines emphasizing the tie between profit and performance • Transitioning SSIP to a full DoD program with Navy still leading Measures of success • Lower costs in production and sustainment on programs • Percentage of Acquisition Strategies with distinct reward and incentive strategies • Cost savings from WG strategies • Number of fewer programs that overrun their cost targets • Number of improved cash flow opportunities that provide benefit to industry and taxpayer • Reinvigorated IRAD program with greater insight into link between funding and technology • Increased employment of FFP contracts

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