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By Nick Wakeman

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Nick Wakeman

Top 10 challenges of OTAs

The use of Other Transaction Authority by government agencies has grown and the Defense Department is leading the way.

They are a potentially big business opportunity but they aren’t for everyone and they do have features that you need to consider before plunging in.

Below I’ve repurposed a list of top 10 challenges published by Wolf Den Associates, a consulting firm that provides clients with a variety of services around procurement, business development, corporate management and other areas where they can apply best practices.

Top 10 Challenges of Acquisition Through OTAs

  1. Procurements tend to be quick-notice, making bids difficult to resource and team
  2. Extensive requirements limit participation from foreign-owned companies
  3. Low barriers to entry enable companies to throw buzzword-laden unqualified bids over the transom.
  4. Working through a consortium can limit ability to shape and/or tailor a bid to a customer
  5. “Non-traditional” contractor definition is ambiguous, leading to “traditional” contractor participation
  6. ”Black box” nature of procurement decision-making deters some non-government contractors from bidding
  7. Limited public information on when consortiums will start can decrease participation
  8. Consortium selection for OTA procurements is opaque, requiring bidders to be “in the know” to succeed
  9. Elimination of protests liberates procurement officers and frustrates competitors
  10. Increasing regulatory oversight, as evidenced by the Rean Cloud decision, will rein in OTA abuse

No. 10 is the most interesting because the recent decision to nix Rean Cloud's once-massive Army contract is so recent. That will either will put a damper on OTAs moving into production contracts or will stimulate some adjustments that will move the process forward.

Another aspect of OTAs that the top 10 points out is the lack of transparency in the process. Wolf Den uses some terms such as “black box,” “limited public information” and “opaque.” I think this something that agencies using OTAs needs to take more seriously and not just scoff at.

I’ll admit to being an OTA skeptic and mostly because so many people talk to them like they are a silver bullet to procurement problems.

But they aren’t. They are just another tool. They have their place but they aren’t for everything.

Posted by Nick Wakeman on Jul 02, 2018 at 8:59 AM


Reader Comments

Sat, Jul 14, 2018 Patrick Shannon Virginia

Nick, I think you would find it very informative to speak with the leaders of the DOTC/NAC OTA team. They really do exemplify the gold standard for OTA use - an optimal balance among transparency, accountability, and agile flexibility. I will send you the POC information by e-mail. While a discussion may not assuage all of your skepticism, I am confident that it may expand your perspective on how the OTA tool can be leveraged for maximum benefit in a responsible way.

Mon, Jul 2, 2018

I'm curious about what this will mean for the contractors who were just awarded seats on DISA SETI.

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