The Department of Defense has announced a strategy to modify its acquisition program. This strategy, set forth in Implementation Directive Better Buying Power 2.0, identifies best practices to be used by DoD acquisition staff in contracting for goods and services. Many of the best practices identified are likely to benefit contractors, as the Directive is designed to allow more flexibility and increased efficiency to the contracting process.
BBP 2.0 includes both general principles as well as specific instructions to guide acquisition personnel. Among the changes that will benefit contractors is the instruction that acquisition personnel select the appropriate contract type and refrain from simply defaulting to the use of firm fixed price contracts without consideration of whether this contract type is compatible with the substance of the contract. This guidance differs from that set forth in BBP 1.0 – which was released in 2010 and emphasized the use of firm fixed price contracts, by specifically instructing Government personnel to assess each acquisition and utilize the type of contract that will be best for the specific goods and/or services being procured.
Additionally, the Directive provides guidance on the appropriate use of Lowest Price Technically Acceptable versus Best Value tradeoffs as well as how best value should be evaluated. As noted in our April 22 post, best value and LPTA evaluations can be difficult to distinguish and evaluation factors for each are often ambiguous. The Directive attempts to resolve the ambiguity surrounding these procurement methods and instructs acquisition personnel not to use LPTA when the evaluation of contractors’ technical proposals will require “subjective judgment,” such as with most professional services contracts. Additionally, if a best value tradeoff is used by the Government, the Directive instructs that the solicitation should include information pertaining to the Government’s quantification of the value (in relation to the increased premium the Government is willing to pay) for exceeding the threshold of acceptability.
However, it is unclear how other guidance contained in BBP 2.0 will affect contractors. For example, the Directive also identifies the DoD objective of aligning contractor profits with contract outcomes. While DoD officials have repeatedly stated that they recognize the importance of ensuring that Defense contracting remains profitable, officials have also directed contracting officers to use profit as a carrot to entice contractors to reduce their costs. At the moment, however, it is too early to tell how the implementation of this Directive will impact Contractors’ profit margins.
From the 30,000 foot perspective, BBP 2.0 provides valuable guidelines to acquisition staff while also acknowledging that professional judgment is required for implementing a successful contracting program. Given the significant turnover of acquisition staff as experienced staff retires and is replaced by a new generation, it is likely that there will be some bumps in the road as the experience necessary to effectively make these judgment calls is gained. However, the guiding principles laid out in BBP 2.0 are more generally more favorable to contractors than those in the prior Directive and we can hope that the added flexibility will produce a more effective, efficient, and favorable contracting environment. The BBP 2.0 Directive can be accessed here: https://dap.dau.mil/Pages/NewsCenter.aspx?aid=304.