Preface

It goes without challenge that the federal government is the biggest buyer of them all. The record shows that in fiscal year 1999, the federal government spent more than 183 billion dollars to acquire goods and services. At the same time, government procurement policies and procedures were undergoing their most extensive overhaul in government procurement history. Not only was the federal government moving toward a paperless contracting process, but it also was changing its policies and procedures to meet post–Cold War needs. The objective of these new ways of doing business, often referred to as “acquisition streamlining,” was to make the process more flexible and responsive. Another goal was to reduce the time required to develop, procure, and deliver the products needed to satisfy requirements.

To accomplish these objectives, many government acquisition managers looked to adapting commercial practices to the federal acquisition process as much as possible. Another way it was determined that the acquisition process could be streamlined was to place greater emphasis on the use of individual judgment and business sense. Members of the acquisition workforce are now being encouraged to use their own initiative and to make decisions within their areas of responsibility.

The story goes that Baron Fredrich Wilhelm von Stuben (1730-1794), a German officer in American service during the Revolutionary War, when asked how the American soldier differed from his European counterpart, answered: An American needs to understand why something is to be done prior to beginning the task, whereas the European is more likely to act obediently without question. During my career in the military, industry, and local government, I found Baron von Stuben’s observation to be true: People perform best when they understand the purpose and objectives behind what they are being asked to do.

Acquisition Management is written with this thought in mind. It is directed to government and contractor personnel working together in the acquisition process as members of a cross-functional team. One of the assumptions on which the book is based is that government and contractor personnel are more effective when they both have knowledge of the rules and regulations as well as an understanding of the principles on which those rules and regulations are founded.

When implementing the Acquisition Streamlining Act of 1994, the government included a set of “guiding principles for the Federal Acquisition System” in the Federal Acquisition Regulation (FAR), which is the primary source of uniform policies and procedures for acquisitions by all executive agencies (FAR 1.101). These guiding principles are intended to provide direction and consistency of purpose to those involved in the acquisition process. Key to an understanding of the process is knowledge of the core principle—“the vision of the Federal Acquisition System to deliver on a timely basis the best value product or service to the customer, while maintaining the public’s trust and fulfilling public policy objectives” (FAR 1.102). This vision is intended to inspire and guide all involved in the federal acquisition process.

Acquisition principles are also intended to provide a standard for decisions by contracting officers as well as other members of multi-functional acquisition teams. The FAR includes a set of four performance objectives: (1) to satisfy the customer in terms of cost, quality, and timeliness of the delivered product or service, (2) to minimize administrative operating costs, (3) to conduct business with integrity, fairness, and openness, and (4) to fulfill public policy objectives (FAR 1.102-2).

One of my primary complaints is that we seem to have gotten sidetracked. The primary purpose of the contract document is to clearly define contractual obligations and establish the completion criteria. In other words, the contract needs to first serve as the common language between the buyer and seller. Its primary purpose is not to protect one party from the other in the event of litigation. Therefore, this book is organized so that it covers the numerous multi-functional tasks as they are scheduled to be accomplished during the various phases of the acquisition process.

One of the reasons I wrote this book is that other procurement texts are organized and written strictly from a legal perspective. Therefore, they are difficult to follow and use as references. Acquisition Management presents material from the FAR at the applicable point in the acquisition phase. It also incorporates recent changes to the Department of Defense’s 5000 series directives and instructions governing the management and operation of the defense acquisition system.

To assist the reader, this book also combines detailed information on the rules and procedures contained in the FAR with information on subjects not included in the FAR. These include: the importance of time in acquiring goods and services; management of integrated acquisition teams; the importance of managing interfunctional as well as buyer-seller relationships; management of risks and opportunities; making tradeoffs; the importance of acquisition planning; market research as an essential element of the requirements determination process; intellectual property; win-win negotiations; managing variances to contract baseline; and cooperative strategic agreements.

These subjects are incorporated into the text at the point in the acquisition process where they are applied. This is important because acquisition is a synergistic process that links the contractor to the ultimate user. The postulate of the acquisition principles is that the customer is best served when functional specialists operate as a part of an independent and integrated system. Government policies and concepts are oriented on a functional basis. It is essential that all members of this integrated team understand the rules and tasks involved in acquiring goods and services so they can work together efficiently and effectively.

Chapter 1, Reform of the Federal Acquisition System, illustrates how the federal government is responding to pressure from its constituents and is initiating action to make the process more responsive and cost-effective. The chapter also provides an historical perspective to the guiding acquisition principles.

Chapter 2 describes the federal acquisition process, the integrated acquisition team and its role, as well as management of the risks and opportunities that are present in every acquisition.

The requirements determination process and procurement planning are covered in Chapter 3. Emphasis is placed on the role market research plays in determining requirements as well as the importance of identifying potential risks and opportunities early in the process.

Chapter 4, The Solicitation, describes the process the federal government follows when asking for information or requesting that potential contractors submit proposals. The quality of the solicitation document is emphasized because it becomes the initial draft of the contractual agreement between the buyer and the seller.

The primary objective of Chapter 5 is to provide information about the preparation of bids and competitive proposals. One of the goals of this chapter is to emphasize that potential contractors need to clarify all ambiguities early in the process as a means of mitigating risk.

Chapter 6 covers the subjects of source selection and contract award. Topics include contractor qualifications, competitive sealed bidding, competitive negotiated procurements, the best value continuum, the evaluation process, exchanges after receipt of proposals, establishing the competitive range, notification of unsuccessful offerors, proposal analysis, making the source selection decision, discussions and negotiations, contract award, and protests.

In Chapter 7, Contract Performance, emphasis is placed on three factors: the importance of contract administration services, the significance of defining and understanding the contract baseline, and the need for an effective interorganizational relationship between the government buyer and seller.

Contract closeout is covered in Chapter 8, the final chapter. Information is provided on settlement of all outstanding contractual issues and assurance that all parties have met their contractual obligations, as well as documenting the contract file.

As noted, the core acquisition principle is to deliver on a timely basis the best-value product or service to the customer, while maintaining the public’s trust and fulfilling public policy objectives. This means that the acquisition process should be carried out in a manner that serves the interests of the buyer as well as the seller. To accomplish this, participants must understand their mutual interests and how both parties must interact for the vision to be achieved.

It is my sincere desire that Acquisition Management will help those participating in the federal acquisition process understand what is behind all the rules and regulations.

Marshall Engelbeck
Colonel USAF (Ret.)
August 2001