In Parts 1 and 2 of this series we talked about the contractor and Government perspectives of setting up for, releasing and responding to a Tera-Scope contract opportunity. Now let’s talk about the high risks associated with putting together such a complicated contractual arrangement.
For several decades the Federal Government has employed Long Term Contracts in order to found relationships with a vendor or vendors for a long period of time. Task orders are issued against the contracts for work as needs arise. This saves the Government from repeating the full acquisition process over and over. Sometimes only the founding Agency can order from the contract. If ordering is open outside the founding Agency it qualifies as a Government-Wide Acquisition contract (GWAC). I’m calling a Tera-Scope contract a Long Term Contract where the Government combines every conceivable IT service under one umbrella that requires each offeror to respond to all task areas. This necessitates Teaming in order to present an excellent proposal in every regard. For Tera-Scope opportunities where you must respond to all task areas a company cannot afford to be “just okay” in any one of them. The main difference for a Tera-Scope is that the range of tasks included is very broad – even vast.
In responding to a Tera-Scope RFP proposals must detail why a Team is high quality and high value for every aspect of the Tera-Scope. Once everything is written and submitted it may still be a while before a decision is made by the Government. A recently publicized Tera-Scope draft RFP comes with a timeline of 12 months for evaluation and selection of teams for award. Make sure you understand the termination provisions of your Teaming Agreements. You don’t want either your niche area experts or your bench strength to evaporate during that lengthy decision process.
Once all the Teams are formed, all the proposals written, all the evaluations and reviews completed and the winning Teams announced, the Tera-Scope contracts are ready to use and …oh. While all the contributing business areas were waiting for the Tera-Scope to get coordinated, approved, solicited, evaluated, reviewed and awarded they went out and did bridge contracts with all their incumbents. They had to. The needs for goods and services were not frozen in time during this effort. Customers needed service and work had to get done. Current requirements are being met and available funds are already committed to those efforts. Add to that the natural resistance to change and the target users for the Tera-Scope contract may not be ready to jump on that new train right away.
There’s also this: in the case of NASA’s SEWP V recompete (a broadly scoped long term contract that is attempting its fifth generation) there were 17 protests of award following the announcement of successful offerors. The Air Force’s NetCents 2 Applications Services contract, (“hardware, software, solutions, and services not offered by other mandatory use Department of Defense or Air Force acquisition initiatives”) , has experienced two disastrous rounds of protests, the first resulting in cancellation of the RFP in 2012 and is now resulting in overturned award decisions from 2013 protests. That’s another reason why bridge contracts with incumbents need to be written. The nature of the protest(s) may mean that no work on the new contracts can begin in case the award decisions are overturned. This process can take a while even if the Government’s decisions are supported in the final analysis.
So what does the government hope to gain from Tera-Scope contracts? It takes a long time to create such a complicated RFP and get approval to issue it, a long time to evaluate the responses and a high risk of protests that delay the start of performance. Wondering if the immensity of the undertaking would make it “just too hard” is what got me started on this series to begin with. A lot of people on both sides of the business equation are spending lots of time and resources to respond to this New Way.
In 2013 GAO removed the “high risk” label from Government-Wide Acquisition Contracts (GWACS). In 2005 GAO perceived GWACS as fueling a rapid growth in spending and that there was insufficient experience within the Government contracts community to manage them properly. OMB believes that there are now mechanisms in place to address issues and reduce risk for fraud, waste and abuse. While this may be so, you have to get to contract awards before you have any risks to control. And the GAO opinion isn’t necessarily based on GWACs that cover Tera-Scopes. Many GWACs cover only one or two aspects of a broad category of products and services.
The OMB web site provides brief descriptions of long term contract opportunities like Multiple Award Schedules (like GSA’s MAS) -a different model, indeed from Tera-Scoping – GWACS (examples are GSA’s OASIS and Alliant contract vehicles and NASA’s Scientific Engineering Workstation Procurement (SEWP) as good opportunities for companies who want to do business with the Government. In addition, the VA is has issued its RFP for Transformation Twenty-One Total Technology Next Generation (T4NG) and DLA has the J-6 Enterprise Technology Solutions (JETS) RFP poised for publication. Who knows what the future holds for NetCents 2 which has been years in formation?
To participate in a MAS each company describes itself and the types of labor they offer, to include hourly rates, products and ordering procedures. At the same time they agree to necessary terms and conditions for doing business with the Government. Buyers create projects of varying scope, browse the eLibrary and other sources for possible vendors and make the final choice after gathering sufficient information using the selected company’s schedule as the basis for award in a greatly simplified process. Any company who takes the time to get a schedule awarded to it can participate. Pricing is limited to Firm Fixed Pricing (FFP) or Time and Materials (T&M).
GWACs, on the other hand, require companies to compete for access to business by winning a new competition. These can be awarded to a single company for a set period of performance or as a group of a limited number of contracts where winners compete within the successful pool for actual work. GWACs should be employed when other pricing arrangements, based on actual costs, are deemed appropriate. Otherwise, why not just use MAS? Most Tera-Scope Performance Work Statements (PWS) I’ve seen are taking the IDIQ/GWACs approach and include multiple pricing approaches including cost types.
One successful example of Tera-Scoping is GSA’s Alliant contract. Alliant covers a very broad range of IT services and has both large and small business companies from which an individual project manager can choose. Contractors participating in Alliant (and the upcoming Alliant 2) do NOT have to commit to providing goods and services for every aspect of the Tera-Scope. Companies can focus on their core competencies and propose to GSA that they are a best value in certain areas. This is a smart way to approach Tera-Scoping in my opinion. It avoids the absolute requirement for Teams being forced upon interested companies as in the all-or-none scenario some Tera-Scopes present. Even so, some unexpected things can happen: GSA has found that the really excellent small businesses under Alliant have gotten so much business that they have become large businesses. The remaining pool of small businesses provides greatly limited options compared to the original results, but a certain amount of the work must go to them anyway. Users of the Alliant vehicle have some tough choices ahead of them while waiting for Alliant 2.
In Part 4 of this series we are going to focus on the rewards and pitfalls of Tera-Scoping in order to wrap things up. Clearly there are benefits to be had from this approach or it would not be trending. But what is the downside?
END OF PART 3