Best value takes center stage in Booz Allen protest

On the surface, this Government Accountability Office decision to deny a protest from Booz Allen Hamilton looks pretty basic.

Booz Allen argued that the Veterans Affairs Department erred in awarding a $22.6 million blanket purchase agreement to Cognosante for support of transformation efforts at the Veterans Health Administration. Booz Allen said both the best-value analysis and price evaluation were flawed, and that the VA didn't fully investigate an alleged organization conflict of interest.

GAO denied all of those allegations and said the acted reasonably.

But the 13-page decision also highlights several factors worth a further look, particularly the best-value evaluation.

Booz Allen argued that both companies had the same adjectival scores on the technical and non-price factors. Because Booz Allen’s total evaluated price was lower, the firm believes it should have been chosen as the best value. Cognosante's total evaluated price was 12 percent higher.

But here is where it gets interesting. GAO writes: “As the (VA) correctly points out, the similarity in the adjectival ratings does not present ‘the full factual picture.’”

The VA said Cognosante had other benefits such as subject matter experts, and predictive models for organizational maturity and employee burnout. This feature could provide significant savings for the VA, the agency argued

So if that’s the case, why wasn’t Cognosante’s score higher than Booz Allen? I suppose that Booz Allen had strengths in other areas that brought their overall score up to the same point as Cognosante. But Booz Allen’s strengths weren’t as important as Cognosante’s strengths? What do you do with that?

One thing it it shows to me is how important it is for proposal teams to understand what the real pain points are for their customer. That might have been the difference here.

GAO also writes that selection officials have “considerable discretion” when it comes down to making a best value source selection. GAO wrote the award doesn’t rely on technical scores or ratings “per se, but on whether the selection official’s judgement concerning the significance of the difference was rational and consistent."

In other words: if the selection officials can rationalize their decision and back it up with what’s in the solicitation, GAO is unlikely to overturn it.

A second point this decisions brings up is how important it is to review solicitations before proposals are submitted. Booz Allen raised complaints that the VA should have used a different price evaluation method, but only did this after Cognosante won the BPA. GAO said that particular Booz Allen claim should have come earlier in the process and not after the award.

The price evaluation portion of the competition is also worth exploring. This BPA uses a fixed price/labor-hour hybrid structure. There are 18 fixed-price contact line item numbers as well as other CLINs for implementation support that would provide on a labor-hour basis. The VA structured it this way because it couldn’t define some of the requirements, but over time the BPA will be primarily fixed-price.

This was another factor that the VA felt played in Cognosante’s favor, because the company’s fixed-price CLINs were lower even though labor hour rates were higher. Over time, the VA felt Cognosante might actually result in lower costs.

That might be a leap of faith but it fits with GAO’s position that the source selection authority has discretion as long as they can justify the decision.

Point number three: the VA could have easily picked Booz Allen, then Cognosante could have protested and GAO likely would have denied it. This episode makes it sound like both companies had strong proposals and the decision came down to a few intangibles.

The lesson comes down to how much power lies in the discretion of the source selection authority. They literally pick winners and losers.