Effective contract management planning
1 / 20

Effective Contract Management Planning - PowerPoint PPT Presentation

  • Uploaded on

Effective Contract Management Planning. For Performance-Based Contracting. It’s a Different Contracting World!. Performance-Based Acquisition fundamentally changed contract formation and administration Objectives structured into contracts and multiple incentive arrangements

I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
Download Presentation

PowerPoint Slideshow about ' Effective Contract Management Planning' - ivor-hutchinson

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.

- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
Effective contract management planning

Effective ContractManagement Planning

For Performance-Based Contracting

It s a different contracting world
It’s a Different Contracting World!

  • Performance-Based Acquisition fundamentally changed contract formation and administration

  • Objectives structured into contracts and multiple incentive arrangements

  • Contractors and Federal staff adjusting to a cultural change

When does contract management start
When does Contract Management start?

  • Old View

    • Started at contract award

    • Embodied a post-award orientation

  • New View

    • Effective contract administration starts early with contract management planning

    • Begins during the acquisition planning phase

    • Recognizes the performance-based elements of the contract

    • The Contract Management Plan is in place before or shortly after the time of award

The performance based contract
The Performance-Based Contract

  • What are the elements of Performance-Based Contracting?

    • Government Protocols Require:

      • Establish requirements in a results oriented manner

      • Ensure that Contract measures and expectations are measurable and correspond to work requirements

      • Ensure that Quality Assurance Surveillance Plans are tailored to contract objectives

      • Incorporate cost constraints or cost incentives

    • Acquisition Guide

      • Performance Based Contracting Guides – provides guidance on structuring effective incentives

The performance based contract1
The Performance-Based Contract

  • What are the elements of Performance-Based Contracting? (cont.)

    • In 1997 Rules mandated that PBCs

      • Requirements are structured in a results or outcome oriented manner

      • Positive and/or negative incentives are included

      • Quality Assurance Surveillance Plans are required

What are the contracting officers responsibilities in performance based contracting
What are the Contracting Officers Responsibilities in Performance-Based Contracting?

  • Other Contracting Rules Require:

    • Ensure that performance-based contracting used to the maximum extent practicable.

    • Use contract types that best fits the work and likely to motivate contractors.

    • Use positive or negative performance incentives to the maximum extent practicable.

    • Quality assurance surveillance plan shall contain measurable inspection and acceptance criteria corresponding to the performance standards of the SOW.

Get results
Get Results! Performance-Based Contracting?

  • Results

    • Identify incentives that support program and site priorities

      • Project specific

      • Integrated efforts (intra-site or inter-site)

      • Technology Development

      • Infrastructure/Facilities Maintenance

    • Contractor Motivation (fee, more work, Peer recognition, past performance assessments)

    • Incentivize Results! Review lessons learned!

Contract management at governement entities
Contract Management at Governement Entities Performance-Based Contracting?

  • Contract Management

    • Government Agencies major site and facility contracts are usually long-term and involve a complex mix of sponsors and stakeholders

    • Integrated Team Members

  • Government Contract Management Focus Areas

    • Project Management, change control, baseline management, technology, performance, quality assurance, fee and incentive management, contractor human resources, etc.

Key contract management responsibilities and focus areas
Key Contract Management Performance-Based Contracting?Responsibilities and Focus Areas

  • Contract Management Responsibilities

    • Ensuring performance of all necessary actions for effective contracting

    • Ensuring compliance with the terms of the contract,

    • Safeguarding the interests of the contractual relationships,

    • Requesting and considering advice of specialists in audit, law, engineering, and other fields, as appropriate,

    • Monitoring Performance, and

    • Enforcing the Government’s rights when necessary.

The contract management team
The Contract Management Team Performance-Based Contracting?

  • Success Depends on an Integrated Team!

    • Contracting Officer (CO), Project Director, etc.

    • Effective administration of PBCs relies heavily on the integration efforts of groups of people representing many functional areas, customers, and stakeholders

    • Past problems can be traced to lack of an integrated effort in managing contract performance

  • Manage the contract not the people or the process

Key tools of contract management
Key Tools of Contract Management Performance-Based Contracting?

  • Quality Assurance Surveillance Plan

  • Contract Management Planning

  • Earned Value Management

Ensuring the quality of performance
Ensuring the Quality of Performance Performance-Based Contracting?

  • QASP

    • Develop early - during the early stages of the RFP (SOW)

    • Tool to evaluate contractor’s performance

    • Provides a structured approach to performing quality inspections and surveillance

    • Establishes frequency and types of inspections

    • Focuses on results - quality and timeliness

  • QASP linked with Performance Evaluation Management Plans (PEMPs)

    • PEMPs establish the performance evaluation process and fee determination process

    • PEMPs may be used to fulfill QASP requirement

Contract management planning
Contract Management Planning Performance-Based Contracting?

  • Why Plan for Contract Management?

    • Challenges by GAO, IG and internal DOE reviews

    • More sophisticated contracting models

      • Performance-based contracting

      • More rigorous contract types, i.e. CPIF

    • DOE Contract Administration Study

      • Little interface between all parties managing the contract

      • Infrastructure/culture not keeping pace with PBCs

      • Lack of “game plan” for managing contracts

    • To develop a “corporate oversight strategy” for ensuring contract success

Contract management planning1
Contract Management Planning Performance-Based Contracting?

  • When is a Contract Management Plan (CMP) Required?

    • For all M&O & Major Site and Facility Contracts

    • Contracts subject to Government Regulation

    • Desirable for service contracts that are complex., high risk with a high $$ value

  • How do we develop an effective corporate oversight strategy/CMP?

    • Begin planning during the earliest stages of the RFP preparation

    • Review the contract and identify key governmental responsibilities (equipment, receiverships, etc.)

Contract management planning2
Contract Management Planning Performance-Based Contracting?

  • How do we develop an effective corporate oversight strategy/CMP? (cont.)

    • Get input from the contractor to ensure critical areas are identified

    • Identify key contract vulnerabilities or performance risk areas that are inherent in the contract

    • Develop a strategy for managing unique terms and conditions (award term, incentives, etc.)

    • Develop a proactive approach for managing the governmental responsibilities and for mitigating any identified risk areas

    • Formally identify the key contract management team, include their names, responsibilities, authorities and limitations

Contract management planning3
Contract Management Planning Performance-Based Contracting?

  • How do we develop an effective corporate oversight strategy/CMP? (cont.)

    • Develop training and guidance to help the culture (infrastructure/people) evolve if site is managing a new contract type (CPIF),

    • Develop an approach for managing the incentive fee arrangements of the contract, and

    • Ensure that other critical focus areas are included - management of contractor litigation, partnering agreements, records management, and other site specific challenges.

Contract management planning4
Contract Management Planning Performance-Based Contracting?

  • How can we use the CMP to ensure successful contract performance?

    • Coordinate and solicit input from all staff involved in contract management

    • Conduct a special session with the contractor on the goals and objectives of the CMP and name the individuals (CO, COR, TM, etc.) responsible for its implementation

    • Meet with all concerned parties on a regular basis to address issues

    • Track performance and assess progress against the QASP

    • Address performance risks or deficiencies early

    • Update the CMP as necessary

Assessing contractor performance
Assessing Contractor Performance Performance-Based Contracting?

  • Earned Value Management

    • Contractor use EVM to control cost and schedule performance as well as report progress against the contract

    • DOE uses EVM to:

      • Monitor and verify progress on contract costs and schedule performance

      • Monitor and validate contractor accomplishments on specific fee and PBI incentives

      • Early warning system to identify deficient progress

Contract management planning5
Contract Management Planning Performance-Based Contracting?

  • What is the CO - Contracting Officer’s role in EVM?

    • The CO is responsible for ensuring that EVM is a requirement in the RFP (when applicable)

    • After award, the CO is responsible for receiving the contract performance reports, approving changes to the system, and generally ensuring that the system requirements are being met

    • The CO relies on subject matter experts for advice on the integrity of the system

    • The CO is responsible for enforcing the terms of the contract and requesting corrective action as necessary

Effective contract management planning

Thanks and Kindest Regards, AAPM Performance-Based Contracting?