Buy Lines: Back to the basics of best value
- By Stan Soloway
- Apr 17, 2003
In a recent letter to Mitch Daniels, director of the Office of Management and Budget, a group of senators sharply criticized the administration's proposal to allow best-value contracting on a small portion of public-private competitions. Instead, the senators argued, public-private competitions should be based on "a combination of cost and quality."
In fact, best value is where cost and quality come together. That's the whole point. But the letter is a sign of how best value is poorly understood and how important it is to reiterate why it is one of the hallmarks of acquisition reform.
The real strength of best value is that it's at once flexible and objective. Far from being the unconstrained bazaar that some critics like to suggest, it is a carefully and appropriately bounded process. Rather than being a one-size-fits-all strategy, best value is an entire spectrum of options, including low price and technical acceptability that enables the government to match its source selection factors to a given requirement.
Additionally, while offerers only see the relative weights assigned to various selection factors, the government must base its decisions on absolute numeric values assigned to those factors before the competition.
In short, best value is a common-sense approach to procurement. It's the way we buy things in our daily lives; it's the way the private sector operates; and it's the way government procurement should function.
Only competitions under OMB Circular A-76, less than 1 percent of all federal procurements, are not allowed to use best-value strategies.
While much of the rhetoric against best value is being used to serve the interests of anti-outsourcing forces, a handful of others are beginning to question it as well. In a survey by the Professional Services Council last year, some government procurement executives expressed concern that support was weakening among some leaders for best value contracting, and for acquisition reform in general.
As one example, some critics say that cost is sometimes not adequately considered in best-value competitions. However, there is no data to support such an allegation, and the experience of many companies is just the opposite: They are concerned that the very performance and quality discriminators on which they have built their capabilities and reputation are not being given adequate credit.
Those questioning best value are clearly in a small minority, and some of them routinely take a troglodytic approach to acquisition. Yet, the very fact that such a discussion is even taking place is distressing.
We need to expand, not limit, the use of best value, even as we make appropriate improvements to the process and its execution. We need to recognize that little of what the government buys is so simple that it should be purchased based on cost alone. And we need to make best value authorities available to all government procurements, including public-private competitions.
The administration can help by including broad best-value authority in its revisions to Circular A-76. Congress can help by supporting the Defense Department's proposal to modify the Title X provision, which requires that its public-private competitions be decided under the old and discredited low-bid system.
Even more important, there must be a concerted and collective effort to reiterate the essential logic of best value, so that we do not take a giant step backward. *
Stan Soloway is president of the Professional Services Council. He served as deputy undersecretary of defense in the Clinton administration. His e-mail is email@example.com.
Stan Soloway is a former deputy undersecretary of Defense and former president and chief executive officer of the Professional Services Council. He is now the CEO of Celero Strategies.