DOD acquisition officials see trade-off problem
Best-value trade-offs are time-consuming and a sticky subject
- By Matthew Weigelt
- Oct 29, 2010
Defense Department officials acknowledged that inexperienced acquisition employees might have trouble choosing the best value among bids for major contracts.
They told the Government Accountability Office that a company's expertise or performance record is often more important than choosing the lowest bid. But that's a more time-consuming process, especially when it involves complex contracts, a lot of money and bid protests, according to a GAO report released Oct. 28.
Officials said making such trade-off decisions demands a great deal of business judgment, and inexperienced acquisition workers might not have that knowledge. Meanwhile, DOD plans to increase its acquisition workforce by roughly 6,400 employees by fiscal 2015 to meet contracting demands, GAO reports.
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“With the influx of new staff, many of the contracting officers we met with noted challenges in preparing staff to conduct the trade-off process,” GAO auditors wrote.
In best-value trade-off decisions, a contracting officer weighs companies’ price proposals against other factors, such as their understanding of complex technical issues or a proven record of delivering similar products or services. In other words, the officer might choose the company with the best technical skills instead of the one with the lowest price.
In fiscal 2009, DOD used the best-value process for roughly 95 percent of new, competitively awarded contracts worth at least $25 million. Almost half of DOD’s contracts — 47 percent — were awarded that way.
DOD used the process for 88 of the 129 contracts GAO reviewed. However, DOD chose a lower-priced proposal nearly as often as it selected one that had a higher technical rating and higher cost.
In addition, 15 of the 88 contract awards were subject to bid protests.
DOD officials agreed with GAO that they need to develop employee training that focuses on reaching trade-off decisions.
Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.