Procurement

Why not 'functionally better' instead of 'technically acceptable'?

Dale Luddeke

As agencies deal with budget cuts, the government is missing an opportunity for innovation and leadership by establishing "lowest price, technically acceptable" as the default approach to the acquisition of IT assets.

The LPTA approach has its place and can work well for commoditized services with clearly defined, low-risk requirements — think facilities maintenance. But "technically acceptable" implies minimum performance expectations based on what we know has worked in the past and does little to keep up with new demands or evolving threats. In other words, LPTA encourages government and industry to settle for "good enough" just to hit a price point.

And when it comes to the acquisition of new technology solutions and services, the LPTA approach offers short-term savings at the expense of long-term mission effectiveness. It hurts the business of government because technically acceptable does not anticipate the needs and threats of tomorrow — or provide for the technology and systems to address them. As the fiscal pressures intensify, it is essential that we reach new levels of performance and efficiency for the short and long term alike.

The time is right to get more from our acquisition approach by changing from "lowest price, technically acceptable" to "lowest price, functionally better" (LPFB).

What is "functionally better"? It means improved or improving levels of performance at a comparatively lower cost across the enterprise. The exact definition will vary based on a specific organization's service or mission. But the acquisition of functionally better solutions and services provides the means to continually lower overall costs and hit higher levels of performance.

Government acquisitions that use an LPFB approach would challenge industry to offer solutions that exceed the performance requirements for "technically acceptable" and still come in at the lowest effective cost. Today's mantra is "do more with less," but in truth we can and must "do more with more."

With technology and complex services, "do more" is what you can accomplish with refined user access, improved search, enhanced visualization and other advanced capabilities.

LPTA encourages government and industry to settle for 'good enough' just to hit a price point. -- Dale Luddeke

"With more" is about leverage: opening up to existing capabilities and new, creative ways to deliver enhanced value in the more complex business and mission areas. It means more critical thinking about what we really need, more critical awareness about solutions already available in the marketplace, and more understanding of what new solutions and services can truly move us past the status quo.

The most effective acquisitions will result in clear options for solutions that iteratively improve and integrate, enabling end users to perform business and mission functions at a higher, optimized level. A government CIO might solicit for a distributed cloud solution to get, at a lower cost, the same functionality that new servers would provide.

With the LPTA approach, the CIO makes a decision based strictly on price. With LPFB, the CIO could select a cost-effective solution with creative ideas for more advanced data sharing and data analytics on secure mobile platforms. The overall cost of the distributed cloud solution might be more than the new servers alone, but the enhanced functionality across a broader user base effectively reduces costs in other areas.

The net return is more user productivity, more efficiency and better results. In short, the LPFB approach holds the promise of purchasing a better overall outcome.

The fiscal constraints that define our current operating environment are pressuring us to go lean and settle for what we know. I think the times demand breakout performance and higher levels of creativity. By moving to an LPFB approach in government acquisition, we would enable and inspire one another to advance toward the real opportunity of being and doing better.

Perhaps LPFB is just terminology, but I believe it's much more. It's an attitude and accountability for moving beyond acceptable to excellent, at the price we can afford.

About the Author

Dale Luddeke is chairman of the Industry Advisory Council and chief growth officer at TASC, a provider of systems engineering, integration and decision-support services to the federal government.

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