CSC loses bid to save missile defense contract

There are two ways to read the Government Accountability Office decision denying Computer Sciences Corp.’s bid protest: the agency was unreasonable, or CSC just plain didn’t listen.

That GAO ruled against CSC tells you want they think. CSC’s arguments fell flat, and it has lost its incumbent contract for systems engineering services with the Missile Defense Agency.

They agency assigned weaknesses to CSC’s bid and adjusted CSC’s price upwards to compensate for the weaknesses. The new price, however, was still lower than the price bid by Parsons Corp. And Parsons also had a high technical score.

The Missile Defense Agency dinged CSC because it felt CSC was bidding too many junior personnel. But this is the confusing part – CSC is the incumbent, and these are the same people who are performing the work now and receiving good past performance scores.

Because of this, the agency moved CSC’s pricing up to $51.9 million to reflect the cost of using more senior personnel.

CSC argued that the actions by the Missile Defense Agency were “unreasonable” and “irrational.”

But then there’s the agency’s side of the story.

Prior to awarding the contract to Parsons, the agency had discussions with the bidders and twice raised the issue of the junior staffing CSC was bidding, and CSC made no changes.

“Notwithstanding the agency’s clear statements of its concern, nothing in CSC’s final revised proposal provided a meaningful response,” GAO wrote in its decision.

CSC did tell the agency that it had performed a “bottom-up analysis” of the requirements. They also referenced their successful past performance and observed that the statement of work for the new contract was similar to the prior contract.

For GAO, CSC just didn’t provide enough justification or “sufficient detail” to back up its position.

“The agency clearly sought CSC’s explanation supporting its leaner workforce and CSC failed to respond in a manner that altered the agency’s judgment,” GAO wrote.

I know hindsight is 20/20, and it does sound like CSC heard the agency’s concerns and thought they were responding. It’s reasonable to assume that because of today’s focus on low price, even in best value contracts such as this one, CSC was looking for a way to further differentiate their bid.

After all, they were performing the work with the personnel they bid, so why not reflect that in a lower-priced proposal? Isn’t that behavior you’d expect an agency to reward?

You have to wonder about the agency’s thinking as well. If your incumbent is performing well, why go with the high price?

The lesson is about more than just listening to your customer. I think CSC probably did that. The lesson is to listen but also be a bit of a mind reader.