ACA Fall Conference 2009 Airports Procurement 101 Developing an Effective Scope Work Martin Obregon, Jr. Executive Assistant – Airports Purchasing and Contracts Services Los Angeles Word Airports mobregon@lawa.org ACA Fall Conference 2009

Overview/Objectives of Seminar Definition of Scope of Work – I will understand the meaning of Scope of Work. Functions of a Scope of Work – I will understand the role of a Scope of Work in contract development and performance. Elements of an Effective Scope of Work – I will identify important ingredients to an effective Scope of Work.

Procurement Vehicle Q: What should I use? Request for Proposals (RFP) Request for Bids (RFB) Request for Qualifications (RFQ) A: It depends on what it is that you want to buy, whether you can specify what it is that you want to buy and whether cost is the only criteria.

Definition of Scope of Work (SOW) Narrative description of products and/or services to be supplied under contract that states: Specifications or other minimum requirements; Performance dates, times, and locations, if applicable; and, Quality requirements.

Definition of Scope of Work (SOW) The SOW serves as the basis for the contractor’s response and as the baseline against which your agency can assess contract progress and measure any contractual changes during contract performance. (from Project Management Terms, A Working Glossary)

Functions of Scope of Work (SOW) Stands as the most important component of an RFP/RFB since it defines the work being solicited in the competition. Clarifies “who, what, where , when, why, and how.” Works as a “stand-alone” document within the solicitation as well as the contract. States the mutual obligations between LAWA and the Contractor that are enforceable.

Planning/Preparing the SOW THINK through what you want the work effort to achieve. ASK yourself the basic questions about the work effort: Who (qualifications)? What? Where? When? Why? How?

Planning/Preparing the SOW (cont.) More specifically, PLAN out the use, functionality, or outcome that you expect from this work effort. STATE what are the existing conditions or framework into which this work effort must fit. ANALYZE whether you need milestones, deliverables, or general support from this work effort. DETERMINE the schedule or term in which the work effort must be accomplished.

Planning/Preparing the SOW (cont.) AFFIRM why this work effort is necessary. UNDERSTAND whether LAWA or the contractor defines the best method for getting the work effort done. THINK through the Life Cycle Costs of this work effort. CONFIRM that there is budget support for this work effort.

Frameworks/Types of SOWs Examples: Performance Based Detailed/Design Specifications Level of Effort

Performance-Based SOW Professional Services Airport states its needs or problem. Focuses on the purpose of the work effort. Contractor determines how best to meet LAWA’s stated objectives. Measures results through technical and quality achievement, schedule progress, or cost performance Sets the level of Acceptance of Work/Quality Assurance.

Detailed/Design SOW Technical IT Services, Construction Defines how contractor does the work. Provides highly detailed plans, requirements, measurements. Establishes technical specifications, quality controls. States specific parameters on how to perform work or make product.

Level of Effort Commodities, Equipment, Non-Professional Services Deliverables are set as either products or increments of an hour of work. Stipulates when, in what manner, and in what period of time the work needs to be completed. Delivery order or task order contracts.

Writing an Effective SOW In very simple terms, an effective Scope of Work is a statement that always passes the SMART Test in that provides information on the proposed work effort that is – Specific Measurable Accountable Reasonable Time-based

Writing an Effective SOW, cont. An effective statement of work reflects the careful planning that precedes it. WRITE clearly, concisely, and with focus. USE precise language given the multiple purposes of the SOW in the contracting process – 1) Basis for competitive proffer by contractor 2) Establishes the criteria for selection 3) Exhibit A/SOW in contract 4) Baseline for managing contract

Writing an Effective SOW, cont. INCORPORATE business writing sense: No ambiguity – one reading, one meaning. USE action verbs and stick with the active voice. USE “shall” sentence structure to indicate a binding provision on the contractor; USE “will” sentence structure to indicate a proposed future action by your agency. RELY on plain-speak. (No jargon, or vague terms)

Writing an Effective SOW, cont. DETERMINE the best organizational strategy: logical grouping, chronology, etc. SPELL out acronyms and provide definitions. SPECIFY how tasks/work efforts are assessed for completion and payment

SOW Template Project Description Phase Description/Milestones Tasks Major Deliverables/Timeframe Methodology/Approach Criteria Technical/Functional Specifications Geographical Scope Acceptance of Work/ Quality Assurance Optional Material/Services Supplies/Material/Equipment Available Resources Progress/Compliance

SOW Template, cont. Project Description Background Division acquiring services/goods Rationale for RFP Services to be performed Timeline Location

SOW Template, cont. Objectives Identify your group’s outcomes -- what it hopes to achieve as a result of the RFP. Indicate how many contract(s) will be awarded to accomplish work effort. Define objectives for overall effort and/or individual tasks.

SOW Template, cont. Phase Description/Milestones Identify the Phases/Milestones. State the deliverables for each Phase/Milestone. Clarify when payment will occur: End of contract, end of phase, upon receipt of deliverable Define the amount of payment (as a % of the overall contract amount) or, Indicate if proposer is required to propose a % or, in the case of concessions, a MAG.

SOW Template, cont. Tasks Provide guidance to assist the Proposer in developing their proposals. (Tasks may vary depending on type of scopes.) Identify the specific tasks that the contractor must complete to achieve the deliverables. Describe what work needs to take place. Provide the framework to establish methodology. Outline what will happen during each Phase/Milestone. (Tasks may provide the basis for payment.)

SOW Template, cont. Major Deliverables Link to milestone/phases, if applicable. Identifies tangible products or outcomes: Defining quality, format, quantity, deadlines. Identify requirements for payment: Single deliverable paid by one invoice Several deliverables paid by several invoices according to completion of milestone/phase Specify payment will be made for “satisfactory work” only.

SOW Template, cont. Major Deliverables (cont.) Identify On-call requirements Identify type of payment for On-call services: Daily rate, flat fee, rate per call Specify if “RUSH” rates are needed: Places obligation on contractor to deliver within specified time for any “Rush” item

SOW Template, cont. Methodology/Approach Criteria Describes how contractor will specifically go about work. OR Indicate that the contractor must propose its own methodology (Performance Based SOW). State any industry, discipline, or organizational standards along with licensing requirements. Identify work that will be done according to proposed vs. prescribed methodology. Identify the contractor’s obligation to provide adequately trained staff to fulfill the contract.

SOW Template, cont. Technical/Functional Specifications (IT) Provide a description of the technical infrastructure, systems and/or software within the organization. Identify requirements for working within the existing environment. Identify specific aspects of the scope that will impact the existing environment. Identify any new technology required. Identify the specific obligations regarding Compatibility, Training, Documentation

SOW Template, cont. Geographical Scope Describe location of work. (Location will impact costs of contractor insurance.) State any impact on airport operation. Describe impact on infrastructure. Identify travel requirements for contractor Frequency, duration, schedule, inter-state, international Identify any risks associated with such travel Construction zone, Airfield, Hazardous materials Identify parameters for travel reimbursement.

SOW Template, cont. Acceptance of Work/Quality Assurance Identify the expectations and authority that will determine acceptance of deliverable. Identify areas that can be the measure for determining acceptance Speed/timeliness of service delivery Meeting or exceeding specification Customer Service (Client Services) Indicate any penalty for not meeting the deliverable/service Withhold payment, Liquidated Damages, % of overall contract Identify benchmarks or a baseline level of service. Identify frequency for assessing Acceptance Weekly, Monthly, Quarterly

SOW Template, cont. Acceptance of Work/Quality Assurance (cont.) Identify the point at which failure constitutes breach of contract. Identify any records contractor must provide Reports, Statistics, Findings, Data, Recommendations Identify any other industry, government, or internal performance standard. Identify aspects of the work for which the contractor will be required to provide its own Quality Assurance methodology.

SOW Template, cont. Optional Materials/Services Indicate any opportunity for contractors to suggest additional material or services that may meet or exceed standards Equipment, Services, Upgrades, Software, Information Clearly indicate that options will be considered, but will not necessarily be included in the resultant contract.

SOW Template, cont. Supplies/Materials/Equipment Identify any supplies that the contractor must supply or use for completion of the work. Identify any supplies/materials/equipment /space LAWA will provide for use during contract. Identify any standards for use of specialized equipment: Brand, Model, Specifications

SOW Template, cont. Available Resources State any resources that would be available to assist the contractor Reports, Manuals, Schematics, Blueprints, Research, Access to Systems

SOW Template, cont. Progress/Compliance Identify the contractor’s reporting obligations Oral, Written, Email, Disk, timelines, deadlines Identify any communication obligations relating to progress Identify specific requirements for meetings with the project authority Weekly, Monthly, Quarterly, Locations

Impact of an Effective SOW Solicitation Stage (pre-contract) Reduces number of questions to clarify solicitation and resulting addenda. Maintains a more predictable schedule and may eliminate extensions to the submittal deadline. Encourages competition. Maintains LAWA’s reputation. Establishes a good foundation for evaluation criteria. May reduce need for amendments to correct scope.

Impact of an Effective SOW, cont. Contract Stage Prevents operational risks such as project failure or delay. Enhances contract management. Reduces legal risks related to contractor litigation, dispute resolution, etc. Promotes positive image of your agency.

credits Developing an Effective Scope of Work Presentation prepared by: Estelle Stevens Senior Management Analyst II LAWA Contract Services Designated Contract Administrator Training Program 2009

References Total Life-Cycle Cost (Total Cost of Ownership) http://www.usps.com/cpim/manuals/pm/pm.htm (USPS Purchasing Manual) Spend Analysis Report by the US Gov’t. Accountability Office that provides comparative information on what is being spent on goods and services as well as who are the buyers and suppliers to identify leveraging opportunities. http://www.gao.gov/new.items/d04870.pdf