CHAPTER 12 SELECTING THE NON-COST FACTORS

Acquisition planners must consider two key areas when establishing non-cost factors. Foremost is the government requirements document, such as a statement of work, a performance work statement, or a statement of objectives. Second, and also of great import, is the information that has been obtained from market research, which includes lessons learned from previous and similar efforts, the names of contractors likely to compete, and knowledge of the state of the art in the particular industry sector involved.

Planners must first ask: What do we need to see in offerors’ proposals to assure us that a resultant contract would fully meet the government’s needs? For example, if the government is using a performance work statement or statement of objectives, is it desirable to have competing contractors submit technical proposals in which they explain in detail how they plan to do the work? If so, what exactly does the government need to properly judge this aspect of proposals?

The result of contemplating these questions might be an evaluation factor that, in abbreviated form, looks something like this:

Technical Proposal. The offeror shall submit a technical proposal addressing in a work breakdown structure (pursuant to Mil Std ___) how the offeror intends to meet the requirements of the performance work statement in Section C of the solicitation. Each paragraph of the performance work statement must be addressed. Proposals will be evaluated on the bases of completeness, feasibility, and risk. Risk assessment will include cost, schedule, and performance risk.

Presuming that the requirement is expected to result in a cost-reimbursement contract of significant monetary value, the planners may decide that they need to look at how the contractor will control costs while remaining on schedule. If so, they might include a factor that in abbreviated form looks something like this:

Management Plan. The offeror must furnish a management plan that encompasses earned value management techniques and demonstrates how cost and schedule will be monitored and controlled. The management plan must also include the processes that will be put into place to surface and resolve actual or projected deviations from projected costs and schedules. This would include identifying the managerial level of the contractor that will be involved in monitoring progress, participating in problem resolution, and overseeing any corrective actions necessary.

As a separate part of the management plan, the offeror must indicate the proposed compensation plan for professional employees expected to perform under any resultant contract.

The management plan will be evaluated on the bases of feasibility, likelihood of success, and usefulness as a tool in risk management. The compensation portion will be reviewed to determine if compensation is of a level deemed reasonable for attracting and retaining highly qualified professionals.

The planners may also consider the qualifications of the key personnel to be used on the contract to be of great importance. If so, a key personnel evaluation factor could be used. For example, the government could explain the qualifications it is looking for and require offerors to provide a resume in a specified format for each of the key personnel to be used under any resultant contract. Sometimes, to avoid a bait-and-switch situation, the government requires proposed key personnel to submit letters of intent to work under the contract.

THE IMPACT OF FACTORS SELECTED

Similar evaluation factors could be developed for past performance, experience, facilities and equipment, small business subcontracting, or any of a host of other potential evaluation factors. It is important to keep in mind, however, that:

• Each evaluation factor will require both contractors and the government to spend time and money respectively preparing and evaluating proposals.

• The FAR calls for factors that support meaningful comparison of, and discrimination between, competing contractors.

• The greater the number of evaluation factors used, the more likely it is that meaningful differences between contractors will not be readily apparent.

While it is important that the government include those factors essential to obtain the best value under the tradeoff process, or acceptable proposals under the LPTA process, it is clearly foolhardy to ask for too much. If market research indicates that only three potential offerors are expected to submit proposals, and all of those offerors have more than adequate facilities and equipment, then including “facilities and equipment” as an evaluation factor would probably waste everyone’s time.

“SAMPLE-ITIS”

It is clear that some organizations suffer from “sample-itis”: They prepare new solicitations by copying from previous solicitations rather than tailoring the solicitation to the requirement at hand. All new solicitations in organizations with sample-itis look surprisingly like the organization’s other solicitations, even though they address different requirements and different markets and are issued at different points in time. Succumbing to sample-itis violates the FAR requirement that evaluation factors be tailored for the particular acquisition.

GREAT LATITUDE

Comptroller General decisions have given great latitude to agencies in determining what evaluation factors to use. Generally, the Comp Gen will take the position that the agency is in the best position to determine what it needs, and the burden is on the protestor to conclusively demonstrate that an evaluation factor is unreasonable. The Comp Gen has even found for the government when an evaluation factor clearly gave the incumbent a substantial competitive advantage. In Harbor Branch Oceanographic Institution, B-243417, July 17, 1991, the Comp Gen opined, “As a general matter a competitive advantage gained through incumbency is not an unfair advantage that must be eliminated … rather, such an advantage is improper only where it results from preferential treatment of an offeror or other unfair action by the government.”

The choices of non-cost factors that can be used are virtually endless. Different groups of planners could look at the market research and the requirements document and devise different sets of evaluation factors. For example, instead of requiring a detailed technical proposal, as was shown in the previous example, a group of planners might emphasize experience and past performance as non-cost evaluation factors and allow the competent contractor they will choose to determine how to do the job.

Although this is said with some reluctance, there is no doubt that evaluation factors can be skewed to favor or work against a particular contractor—for or against an incumbent contractor, for example. Contracting officers, legal counsel, and the source selection authority are the primary lines of defense in making sure that factors chosen do not unduly or unfairly favor one or more contractors. This does not mean that the project office is not permitted to ask for what it needs even if that has the impact of limiting competition. The Competition in Contracting Act (CICA) allows restrictive requirements, but only to the “extent necessary.” And in the Comp Gen opinion cited above, the Comp Gen said, “Where a solicitation includes requirements that restrict the ability of offerors to compete, the agency must have a reasonable basis for imposing the restrictive requirements.” Thus, an agency does not have to sacrifice its needs to level the playing field for potential offerors. However, it must be prepared to conclusively demonstrate that the needs are genuine and reasonable.

WHERE TO BEGIN

There are a variety of ways to establish non-cost factors. For example, each individual acquisition planner (or member of the integrated product team) can independently review the government requirement and the information obtained from any market research, as well as any lessons learned from previous similar acquisitions. Then the entire team could meet and brainstorm what should or should not be included as an evaluation factor and whether any factors proposed should instead be subfactors. A consensus opinion reached could then be submitted for approval to the contracting officer and the source selection authority.

Another way to approach the matter is to have the senior planner from the project office propose evaluation factors and subfactors and then obtain team input and recommendations before seeking approval.

Whatever method an agency employs, it can be helpful to keep in mind advice from the Department of Energy’s acquisition guide. The guide states, “As a rule of thumb, evaluation criteria should reflect areas necessary to determine the merit of a proposal, pertinent to the Government’s stated requirements and measurable to permit qualitative and quantitative assessment against the rating plan.” Whatever the procedure used, participants should keep in mind the FAR requirements for factors and subfactors and the other issues that have been raised in this chapter.