2. Competition Moderator: Greg Macfarlan, CPCM, LMI Presenters:
Lyle Eesley, Fellow, Center for Contracting, DAU
Ronne Rogin, CPCM, Acquisition Solutions, Inc.
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

3. Into the 21st Century….! Competition What are its characteristics?
What works and what doesn’t?
What barriers does it face?
What forces are impacting competitive environments?
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

4. Competition Overview Trends Strategy The Ultimate Competition
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

5. Guiding Principles (FAR 1.102)
(1) Satisfy the customer in terms of cost, quality, and timeliness of the delivered product or service by, for example --
(i) Maximize use of commercial products and services;
(ii) Use contractors who have a track record of successful past performance
(iii) Promote competition;
Competition is the power that fuels our economy
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

6. Competition Trends Supply Chain Management
Reduce the competitive supplier base
Increased reliance on supplier intellectual property and value
Performance Benchmarking
Walk softly, but carry a big stick
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

7. Define your Competition strategy
Successful competition requires you understand three key issues
How your customer defines value
Nature of the requirement
Market place you’re operating in
One strategy does not fit all situations
Requires sound, thoughtful, planning
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

8. Competition Planning How your key stakeholders define value
Cost, timeliness, performance
What’s their “trade space”
What is the nature of the requirement
Commodity item or “value added” supplier
Understand the Market Place
Who are the leaders, innovators
Market practices and the business cycle
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

9. Competition Strategies
Price Focus
Fosters “low bid” mentality
Can drive high quality performers away
Does not drive innovation
Performance Focus
Ability to assess differences
Enables creative use of “Trade Space”
Managing the outcomes
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

10. As Supplier “value add” increases, the nature of competition and acquisition approach changes
System
Development
Performance
Based
Value Added
by Supplier
Price Based
Coal
IFB
LPTA
PPT
Technical Tradeoff
Acquisition Methodologies
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

11. Leveraging Competition to enhances performance
Contractor
Scorecard Matrix was used to determine offeror proposed service levels and increased coverage, within the government set minimums and maximums.
Government minimums equate to current levels of service or AF standard.
Offeror proposed levels become official part of the contract.
KPIs = Hurdles in the incentive formula.
Increased Coverage = “Bang” we bought.
Every offer exceeded the minimum KPIs…some were riskier than others.
Most offers exceeded the minimum coverage levels.
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

12. Leveraging Competition to enhances performance
Contractor
Scorecard Matrix was used to determine offeror proposed service levels and increased coverage, within the government set minimums and maximums.
Government minimums equate to current levels of service or AF standard.
Offeror proposed levels become official part of the contract.
KPIs = Hurdles in the incentive formula.
Increased Coverage = “Bang” we bought.
Every offer exceeded the minimum KPIs…some were riskier than others.
Most offers exceeded the minimum coverage levels.
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

13. Competing for the Future
The Ultimate Competition - Your Future
Are you “Inherently Governmental”
Effective Business Advisor must be:
Business Savvy Strategist
Aligned with customer’s mission value proposition and mission objectives
Continually refreshing you knowledge
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

14. We’ve got choices! Open Market Agency IDIQ’s GWACs and MACs
GSA Schedule Contracts
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

15. We’ve got competition! Contractors compete with one another
Contractors compete with Federal employees
Franchise fund activities compete for your business
GSA will conduct your IT acquisitions
Your agency acquisition shop is there, too
Internal competition for resources
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

16. What happened to “low bid?”
Historically, awards were based on low price
Competition drove prices down
We got what we paid for…
Price is less important today – it’s all about value and return on investment
And so we measure…..ka-CHING!
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

17. The Federal Marketplace
Mergers and acquisitions
Anti-bundling vs. horizontal purchasing
Small/disadvantaged business set-asides: GSA’s FAST and DoC’s COMMITS programs, along with subcontracting roles
Shrinking budgets across many agencies and programs present fewer opportunities
Stategic sourcing
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

18. Should competition be limited?
GWACs, MACs, and agency
IDIQs provide a smaller com-
petitive field
FAR Part 15’s “downselect” process can whittle down the number of offerors
A vendor’s ‘ticket to the show’ is a GSA Schedule contract – full and open?
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

19. Remove Barriers to Competition
Reduce or eliminate statutes, regulations and/or policies that inhibit competition
Take steps to reduce the cost of entry,
and reach out to small businesses
Increase the ability of players to be innovative and efficient (results-based contracting)
Advocate consistent entry rules across the Government
Expand the supplier base where possible
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

20. So is competition a good thing?
In theory, we get lower prices and more value
In reality, some firms cannot deliver at the prices they proposed – they may request changes to the contract in order to improve their bottom line
Good risk assessments and past per-formance reviews (MARKET RESEARCH) help ensure positive results
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value

21. VOTE HERE Yes, in most instances No, not always
General counsel’s reply: “It depends.”
NCMA 22nd Annual East Coast Educational Conference
Understanding Competition, Enhancing Small Businesses, and Getting Best Value