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By Nick Wakeman

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Nick Wakeman

Bid protest dilemma continues

I always have mixed feelings when the Government Accountability Office releases its annual bid protest report.

It lists the number of cases filed and closed as well as the number of cases that had merit and were sustained and denied.

My feelings are mixed because I believe there are too many bid protests. I’ve heard plenty of comments from industry people who say bid protests are a common tactic by losing incumbents to extend their work on a contract because the transition to the winner is delayed while the protest winds its way through the process.

There also is a sense that companies have little to lose by filing a protest, so why not protest?

But at the same time, I also believe that many companies simple don’t have a choice but to file a protest. For some it is a desperate attempt to learn why they lost because debriefs have become uninformative. For others, they truly believe the wrong decision was made. And sometimes they are right.

The dilemma is how do you separate the protests that are simply a business tactic from those who feel they should have won the contract and that the government made the wrong decision?

There is no easy answer.

One thing that is undeniable is that the number of protests has grown over the last decade with 1,352 cases filed with GAO in fiscal 2003, compared to 2,475 in fiscal 2012. The number of protests with merit has gone from 290 in 2003 to 570 in 2012.

The sustain rate has been all over the place – 17 percent in 2003 and 18.6 percent in 2012, but in between it has been as high as 29 percent in 2006, and a low of 16 percent in 2011.

GAO said the effectiveness rate – where a protestor gets some form of relief in the final decision – was at 42 percent in 2012, compared to 33 percent in 2003.

But I wish GAO reported the number of bid protests that are withdrawn before any decision is reached.

Withdrawn protests usually happen for two reasons.

One is when the winning bidder and the losing bidder work out an agreement where the loser joins the winner’s team. This happened in 2011 when Northrop Grumman withdrew its protest of the $2.5 billion State Department Vanguard contract when the winning bidder, Science Applications International Corp., found room on its team for Northrop.

The second and probably more common scenario is when an agency realizes it made mistakes in an award and pulls it back to reevaluate or restart the competition. This is what happened with the Air Force’s $6.9 billion NetCents 2 hardware contract. The Air Force withdrew its awards to nine companies after 11 companies filed protests. Six months later there is still no new awards.

The number of withdrawn protests would be insightful because I think it plays a role in the decision by companies to file a protest. It also points to problems with the process because agencies are making decisions that can’t stand up to scrutiny.

So what is the answer? Perhaps losing bidders who then lose their protest should be charged a fee. This might mitigate the tactic of filing protests just for the sake of hanging onto the work a little longer.

But beyond that, I lay most of the problems on poor decisions and processes by the government. The answer here is to go back to the basics: write better requirements, explain the evaluation criteria, don’t be sloppy.

For contractors, the big question on whether to protest has to be how to balance the needs of their customers against the needs of the bottom line. And I don’t know where that balance is.

Unfortunately, about the only thing contractors can do is build the time for protests into their planning and resource management process. That’s today’s sad reality.

Posted by Nick Wakeman on Nov 16, 2012 at 9:52 AM

Reader Comments

Tue, Nov 27, 2012

In some cases, protesters simply lost and don't know why. In many cases over the past few years, the Government has been not been writing good requirements or evaluating consistent with their criteria. In the worst cases, you can guess who the Government is going to favor before teh RFP even comes out. The Government needs to write better RFPs, conduct better and fairer procurements, and spend more time on informative debriefs so that unsuccessful offerors can improve their proposals for the next time.

Mon, Nov 26, 2012 SPMayor Summit Point, WV

Everyone likes to point out why the 'other' guy is at fault ... and in this case it is easy to show a preference for blaming the Government. Yes, the RFP[principally Sections C,F,L,and M - with the occasional B as well] reflect poor attention to detail, a clear lack of understanding between the relatinship among those sections and staff ill-prepared for the responsibilities assigned to them. However, in my view, contractors are really not well prepared to deal with a simple fact - they're proposal was not as good as they would like to believe. I don't honestly believe that better debriefs would guarantee a reduction in protests. There are too many other considerations at play within and among firms to presume protests could be minimized. And, please get me the relationship of the number of transactions that could be protested and the number that were. I have yet to see anyone acknowledged that during the years cited the number of transactions increased such that the relative % of protests to transactions should a meaningful increase.

Mon, Nov 26, 2012 ds VA

I agree with the "sloppy" solicitations that in many cases are written to provide an advantage to the desired vendor. I don't agree with charging a "fee" since there is already a vendor high legal cost associated with filing and supporting a protest activity. Consolidation of solicitation activities (especially IDIQ's and GWACs) may help to reduce work loads and procurement costs.

Mon, Nov 26, 2012

Actually, a protester now has a 75+% change of something good happening as a result of a protest. what's not to like?

Mon, Nov 26, 2012 Richard Virginia

I am sorry to say I have seen the consistently worst RFPs in my entire career (35 years both as govt and contractor) in the last 2 years. RFPs have been so sloppy obvious questions arise and some clearly were cut and paste jobs from entirely different RFP subjects with remnants to key areas left in then to be struck in the last minute mods. The Q&A and mods often do not resolve a legitimate issue which is then left in the award process and clearly are valid points of protest. Examples - require certs which the incumbents of many years do not have (some contracting office threw in a nice to have) and then judge based upon continuity and experience (hire the incumbents) sets up a clear conflict in requirements.

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