Section 809 Panel: Speed Defense Acquisitions and Use Best-in-Class Contracts

Among the many topics examined by the Department of Defense’s Advisory Panel on Streamlining and Codifying Acquisition Regulations (a.k.a., Section 809 Panel) over the last two years is finding ways to reduce what is commonly called procurement administrative lead time or PALT. For those unfamiliar with the term, PALT is how long it takes an acquisition to move through its entire lifecycle, from the generation of requirements to receipt of the contracted good or service by the customer. PALT at the DOD, the Section 809 found, is appallingly long, ensuring that the department always receives technology which is outdated and typically more expensive than what can be acquired on the open market. Exceptionally long PALT is not a problem exclusive to the DOD. Civilian agencies also suffer from it, but in organizations like the Army, called out specifically by the panel, the average length of PALT can stretch to over 700 days for procurements valued at higher than $1B. Even much smaller procurements valued at between $50M and $100M can easily take 400 days or more to complete. Lead times this long create significant challenges for the DOD, concluded the Section 809 panel, which issued several recommendations to address the problem. Two of those recommendations – reducing documentation burdens and using best-in-class contracts are examined here.

First, the panel suggested eliminating “redundant documentation requirements or superfluous approvals when appropriate consideration is given and documented as part of acquisition planning.” In other words, over the years duplicative documentation and approval requirements have crept into the acquisition process. These should be identified and eliminated to speed the process and reduce acquisition costs. The panel provides a number of examples where excessive regulations have entered the process and can be eliminated with relative ease.

Second, DOD should “revise regulations, instructions, or directives to eliminate non-value-added documentation or approvals” pointing again to the burden of excessive paperwork required to move procurements forward. For example, the panel identified a DOD process developed by the Better Buying Power initiative stipulating that “for services, where a single offer was received in response to a solicitation open for less than 30 days,” the soliciting agency is required to re-solicit for an additional 30 days rather than making an award. The panel recommended repealing this rule to enable faster awards when normal solicitation procedures have been followed, but have resulted in only one proposal per solicitation.

The panel also sub-recommended that “the documentation approval process for DOD programs to use OMB-designated best-in-class (BIC) contract vehicles for direct acquisitions” be eliminated. This is a critically important recommendation for contractors to understand because ending this process opens the door to much wider use of BIC contracts by the DOD.

The General Services Administration developed the best-in-class contract classification (BICs are listed here) as part of the category management initiative. Making these contracts easier for DOD to use will not only simplify procurement procedures, particularly for commodity IT, it will direct a higher percentage of DOD’s IT spending toward these contracts. DOD will no longer need to compete its own specialized vehicles as often, meaning that if a company doesn’t already hold a spot on a BIC contract the department intends to use it will find its competitive opportunities curtailed. This is a potential development that could affect small businesses the most since they often don’t have the revenue that allows them to compete for spots on multiple large contract vehicles.

Easing access to BIC contracts and eliminating redundant paperwork requirements alone will reshape the face of defense technology procurement. Greater use of BIC contracts in particular could have a major impact on shaping the market in years to come so it is important to watch the outcome of the Section 809 panel’s recommendations and see where policy changes are made.