Choice of contract type not key to success
- By Chip Mather
- Apr 27, 1997
If your mission is to award a desktop replacement contract your options for how to fulfill that obligation are growing.
Currently many agencies are struggling with whether to award an indefinite-delivery indefinite-quantity (IDIQ) contract or take advantage of a blanket purchase agreement against a General Services Administration Federal Supply Schedule (FSS). My best advice which may come as a surprise to some is to go with the BPA.
To achieve the greatest results the objective should be to marry the best attributes of the IDIQ contracts with the speed and efficiency of the BPAs. The goal would be to award - within one to two months - FSS BPA(s) to the contractor(s) offering the products that theoretically would have won an IDIQ contract and still obtain similar discounts.
The key to success is not the contract type - FSS BPA vs. IDIQ - but the strategy used to create and maintain the maximum competitive environment.
IDIQs and BPAs have both failed when the government did not structure the acquisition to harness the market's competitive forces.
The Air Force the Army and the Department of Veterans Affairs were able to obtain significant discounts on IDIQ contracts - including Desktops IV and V PC-2 and the Procurement of Computer Hardware and Software pact - and maintain those discounts not because of contract type but because the program was structured to benefit from the competitive market pressures and the agencies' aggregated quantities. Offerors knew the "size of the pie" and realized that there would be multiple competing offers that only two awards would be made and that they would continue to compete for orders after contract award. This environment drove competitors to provide maximum discounts while giving the agency significant "clout" as those vendors' largest customer.
However in the best of cases these advantages came only after many months of extraordinary effort from source-selection teams who had to review a large number of proposals and fight the inevitable post-award protests.
If correctly crafted the FSS BPA award process can reduce this lead time to literally one to two months greatly reduce the risk of protest and provide similar price discounts and vendor performance. The key is to establish the same competitive environment found in the successful IDIQ programs. To simulate IDIQ-type competition in FSS BPA(s) the competitors must know:
* The realistic estimate of the size of the pie and its basis.
* The number of BPAs that will be awarded.
* That differing manufacturers' products will be solicited.
* That price will be the primary selection consideration.
MAS BPA Disadvantages
This is not to suggest that the FSS BPA process does not have disadvantages. It does. For example BPAs cannot change the terms and conditions of the basic schedule and unless the schedule is modified some agencies' specialized terms and conditions may not be met. Also GSA is the schedule contracting officer and ultimate authority for contract administration remains at GSA. Furthermore GSA collects a 1 percent fee for its services. Finally the FSS BPA process is a relatively new procedure and as such has not been fully tested by the courts or through the protest process. Some of its more "innovative" procedures are sure to be tested in the near future.
The current discussion over which contract type is "better" misses the point. I can readily identify both IDIQ and BPA failures. If properly structured and conducted a competitive FSS BPA can be an exceptional tool to quickly acquire commercial off-the-shelf commodity-type resources at discounts approaching the best IDIQ contracts.
-- Mather is a senior vice president at Acquisition Solutions Inc. a firm that provides acquisition support and best-practice guidance to federal agencies. He developed the streamlined source-selection techniques applied to the Air Force's Desktop IV and V acquisitions. Mather can be reached at email@example.com.