The world according to 803
- By Steve Kelman
- Nov 10, 2002
For contracting cognoscenti, "803" refers to a provision in the fiscal 2001
Defense Department authorization bill regarding competition for orders under
the General Services Administration's schedule contracts. Section 803 came
about in reaction to reports that many awards were being made when only
one bid was received. Congress set up procedures that, in effect, require
DOD buyers to get three bids before placing orders for serv.ices under multiple-award
contracts. DOD has just issued regulations implementing these requirements.
The changes are good for the government. GSA schedule and other governmentwide
contracts provide a streamlined way for agencies to access quality vendors
efficiently. The Education Department and the Defense Logistics Agency have
conducted procurements that were quick, quality-oriented and brutally competitive
using the schedules. It can be done.
Because competition became associated with endless procedures that often
allowed a poor contractor to win by gaming the paper proposal process, many
have failed to realize that the streamlined, quality-based, vigorous competition
that multiple-award contracts allow is very much in the government's interest.
Agencies should want to get three bids. Government should realize this keeps
vendors on their toes.
It may be harder, however, if an order is a recompetition of work in
which the incumbent vendor has performed well. Such vendors should have
an advantage. For this reason, other vendors may be hesitant to bid. But
an agency has an obligation to scour the marketplace to look for other bidders.
Otherwise, the incumbent vendor may become lazy.
As important as the substance of those changes is how they are framed.
Those who want to return to the Dark Ages of bureaucracy the triumph of
process over results want to frame Section 803 as a swinging of the pendulum,
in which a period of greater freedom is followed by a return to controls
in a never-ending cycle in which no progress is made. If we accept this,
it can become a self-fulfilling prophecy.
Any time an organization changes how it operates, we should expect problems
as well as benefits from the first round of change. Indeed, students of
change argue that it's important to get something out there, knowing it
won't be perfect, so you can learn from successes and mistakes and make
the new system better. In the world of organizations, this is known as "continuous
improvement." In the world of technology, it's moving from Version 1.0 to
2.0. The alternative a "grand design" approach to change that requires
something to be studied to death to get the perfect system the first time
is a recipe for failure.
We should not frame Section 803 as a swing of the pendulum. Instead,
we should reaffirm our belief that government is capable of improving over
Kelman is professor of public manage.ment at Harvard University's Kennedy
School and former administrator of the Office of Federal Procurement Policy.
He can be reached at email@example.com.