Alpha Contracting

• Sole Source Negotiations between Government and Industry

• (13 CFR124.503(c)(2))

2

ALPHA CONTRACTING DEFINED

• An acquisition process adopted to reduce the acquisition cycle time by replacing a serial process with a concurrent one, through government and contractor teaming (e.g., overarching Integrated Process Team (IPT)) without compromising the standard of a fair and reasonable price.

• Used in sole source acquisitions, pre-award phase of Integrated Process and Product Development (IPPD)

• An approved Acquisition Plan and J&A is required before Alpha contracting discussions and negotiations begin on any program/project.

3

ALPHA CONTRACTING PROCESS

• Joint Government/Industry IPT is established to develop the requirements, draft the contract, conduct the audit, and find the right price for the acquisition (requirements, contracting, audit, the user, and the contractor/principal subcontractors)

• There is no solicitation or proposal – the IPT develops the technical and cost detail that is the basis of the contract (a “model” contract (Ref. FAR 15.204-1, Sections A-J) developed early in the process prior to final pricing)

• IPT may identify the need to change the program base-line to improve performance, lower risk, or reduce cost

• Cost and technical data jointly developed to address concerns of Government pricing and audit personnel as the program costs are developed (fully supported contract price)

• “Model” contract revised and adjusted as technical and price details are resolved; model becomes the executed contract document

4

ALPHA CONTRACTING

• ADVANTAGES

- Reduction in time to award (up to 50%)

- Enhanced understanding of contact (lower program risks)

- Positive environment for execution

- Greater customer satisfaction

• DISADVANTAGES

- Up front labor-intense- Need for dedicated

personnel

- Trust doesn’t come easy

5

WHAT IS ALPHA CONTRACTING?(MORE SPECIFICALLY)

Government and Contractor Teaming

• Open communications early in the process

• Mutual understanding of the Statement of Work (SOW) requirements (Contractor & Government may co-write)

• Agreement on appropriate scope and hours/task prior to “model” contract submittal

• Contractor and government Team develop final “model” contract together (includes cost and pricing data)

6

STATUTORY REQUIREMENTS

• Federal Acquisition Streamlining Act of 1994 (FASA) – reduce overall costs of the acquisition process

• FAR 5.101 enforces Synopsis requirements

• FAR 6.302 enforces CICA J&A requirements

• FAR 15.805-1 requires the PCO to assemble a team to perform an Independent Government Review

• FAR 15.808 requires preparation of Pre- and Post Clearances

• Technical Review Required

• Executive Order 12931, October 13, 1994

7

OUTPUTS OF ALPHA CONTRACTING APPROACH

• As a team, the Government and Contractor develop the RFP and Statement of Work (SOW)

• Using this baseline RFP and SOW, Government/ Contractor Team development a “model” contract

• With this “model” contract, the program is priced out using tools such as CAIV

• “Model” contract is adjusted based on the pricing arrangements agreed upon by all Team members. (This becomes the contract document executed.)

Develop the scope of work on a program, price that scope, and prepare the contract to execute that scope

8

TRADITIONAL CONTRACT FORMATION

ACQ PLAN RQMTSPACKAGE

FORMALRFP

PROPOSAL

REVIEW &AUDIT NEGOTIATE

CONTRACT AWARD

_______________________________________________________________0 Timeline (in days) 365

EXCLUSIVE SERIAL PROCESSING

9120 – 160 Days

CONCURRENT CONTRACT FORMULATION(ALPHA CONTRACTING)

ACQ PLANRQMTS

PACKAGE

DRAFTRFP

FORMALRFP

CR

Proposal

REVIEW &AUDIT

CR

NEGOTIATE

CR

CONTRACTAWARD

CR

10

WHAT TEAM MUST DO

• Focus on meeting established milestones

• Make sure all the right people attend team meetings (establish common location)

• Establish IPT and identify Team Leaders

• Define technical review process

• Establish a common spreadsheet

(PMO/DCMC/DCAA/CONTRACTOR)

• Keep Top Management informed

11

PRE-PROPOSAL RELEASE

• Clearly establish budgetary ROM

• Write sound Draft SOW and preliminary delivery schedule

• Answer the question “What do I think this effort should entail?”

• Develop mutual understanding of SOW content (discussions)

• Finalize strategy for unique contract provisions (e.g., WARRANTY, GFP)

12

PROPOSALSUBMISSION AND REVIEW

• Assemble technical review team on-site

• Achieve deeper understanding of SOW content (discussions)

• Assign one individual to each cost content summary sheet

• Identify who the other Evaluators are to Answer the Question “What information have I received that causes me to believe we have the right position?”

13

NEGOTIATIONS

• Provide inputs to Team Leader for final review

• Team Leaders (only) authorized to discuss effort with Contractor

• All Team members available to resolve outstanding issues and fine tune requirements

14

CONTRACT AWARD

• Consider award on adjusted “model” contract (from

Alpha teaming process) with required pen and ink

changes

• Maintain close contact with the budget officer for final

funding release in a timely manner

15

CONCLUSIONS

• Proven Approach for reducing acquisition cycle lead time (50% or more), reducing program costs (less risk) , and improving both negotiated agreement and probability of program success

• Open, Honest, Cooperative approach reduced potential for litigation during program execution and opens door for other initiatives to reduce costs

• Improved customer satisfaction given better quality and performance and realized expectations given their involvement in the process

• Teaming process needs to continue beyond contract award. Overarching IPT should stay in place to assure communications and cooperative environment