NCMA World Congress 2004

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Seven Steps to Performance-Based Services
Acquisition
Breakout Session WC04-995 Philip E. Salmeri,
President Salmeri Seminars Date 27 April
2004 Time 245 345 pm
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Seven Steps to Performance-Based Services
Acquisition

• This session will review the seven steps for
  performance-based services acquisition. A brief
  discussion will focus on each steps tasks,
  features best practice. From the establishment
  of the Team through the management of contractor
  performance, this session will relate real world
  scenarios to each of the seven steps.

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Seven Steps to Performance-Based Services
Acquisition

• Establish the team.
• Describe the problem.
• Examine private-sector public-sector solutions
• Develop PWS or SOO.
• Decide how to measure manage performance.
• Select the right contractor.
• Manage Performance.

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Seven Steps to Performance-Based Services
Acquisition

• Step 1 -Establish an Integrated Solutions Team
  
• Engage the stakeholders and define the roles and
  responsibilities of the acquisition team.

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Seven Steps to Performance-Based Services
Acquisition

• Step 2 - Describe the Problem that Needs
  Solving
• Ask questions What is the problem the agency
  needs to solve?
• What results are needed?
• Will it meet the organizations mission
  objectives?
• What constitutes success?

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Seven Steps to Performance-Based Services
Acquisition

• Step 3 - Examine Private-Sector and Public-Sector
  Solutions
• Explore the market from an industry and
  government perspective.
• The guide recommends several tactics, such as
  one-on-one meetings with industry to explore
  commercial best practices, innovative delivery
  methods, and incentive programs.

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Seven Steps to Performance-Based Services
Acquisition

• Step 4 - Describe the Problem that Needs Solving
  By Developing a Performance Work Statement
• Develop a Performance Work Statement (PWS) or
  Statement of Objectives (SOO), a concept
  espousing that the Government state objectives
  simply and concisely, and allow industry to
  propose a solution.

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Seven Steps to Performance-Based Services
Acquisition

• Step 5 - Decide How to Measure and Manage
  Performance
• Use measurements that are important to
  accomplishing the objectives of the requirement.
  When possible, use commercial quality standards,
  such as ISO9000 and CMM, or request that the
  contractor develop performance metrics and
  quality assurance plans for the proposed
  solution.

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Seven Steps to Performance-Based Services
Acquisition

• Step 6 - Select the Right Contractor
• Employ recommended best practices when selecting
  the contractor, including competing the
  requirement, using the downselect process to
  work with a manageable number of vendors, and
  using oral presentations, past performance
  checks, and best value for source selection
  decisions.

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Seven Steps to Performance-Based Services
Acquisition

• Step 7 - Manage Performance
• Keep the team together by assigning
  accountability for managing contract performance,
  conducting formal kick-off meetings, and regular
  contract performance and monitoring meetings.
  Actively manage the important contractor/Governmen
  t relationship, and maintain continual honest and
  constructive feedback, with the goal of
  continuous improvement.

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PBSC STEP 1 Establish an Integrated Solutions
Team

• Tasks, Features, Best Practices
• Ensure senior management involvement and support.
• Tap multi-disciplinary expertise.
• Define roles and responsibilities.
• Develop rules of conduct.

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PBSC STEP 1 Establish an Integrated Solutions
Team

• Tasks, Features, Best Practices, (cont)
• Empower team members.
• Identify stakeholders and nurture consensus.
• Develop and maintain the knowledge base over the
  project life.
• "Incent" the team Establish Link between program
  mission and team members performance.

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PBSC Step 2 Describe the Problem that Needs
Solving

• Tasks, Features, Best Practices
• Link acquisition to mission and performance
  objectives.
• Define (at a high level) desired results.
• Decide what constitutes success.
  
• Determine the current level of performance.

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PBSC Step 3Examine private-sector
public-sector solutions

• Tasks, Features, Best Practices
• Take a team approach to market research.
• Spend time learning from public-sector
  counterparts.
• Talk to private-sector companies before
  structuring the acquisition.
• Consider one-on-one meetings with industry.

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PBSC Step 4 Develop PWS or SOO

• Tasks, Features, Best Practices (PWS)
• Conduct an analysis.
• Apply the "so what?" test.
• Capture the results of the analysis in a matrix.
• Write the performance work statement.
• Let the contractor solve the problem, including
  the labor mix.

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PBSC Step 4 Develop PWS or SOO

• Tasks, Features, Best Practices (SOO)
• Begin with the acquisition's "elevator message."
• Describe the scope.
• Write the performance objectives into the SOO.

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PBSC Step 4 Develop PWS or SOO

• Tasks, Features, Best Practices
• (SOO cont)
• Make sure the government and the contractor share
  objectives.
• Identify the constraints.
• Develop the background.
• Make the final checks and maintain perspective.

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PBSC Step 5Decide how to measure manage
performance.

• Tasks, Features, Best Practices
• Review the success determinants.
• Rely on commercial quality standards.
• Have the contractor propose the metrics and the
  quality assurance plan.
• 
  

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PBSC Step 5Decide how to measure manage
performance.

• Tasks, Features, Best Practices (cont)
• Review the success determinants.
• Rely on commercial quality standards.
• Have the contractor propose the metrics and the
  quality assurance plan.
• 
  

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PBSC Step 5Decide how to measure manage
performance.

• Tasks, Features, Best Practices (cont)
• Select only a few meaningful measures on which to
  judge success.
• Include contractual language for negotiated
  changes to the metrics and measures.
• Apply the contract-type order of precedence
  carefully.

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PBSC Step 5Decide how to measure manage
performance

• Tasks, Features, Best Practices (cont)
• Use incentive-type contracts.
• Consider "award term."
• Consider other incentive tools.
• Recognize the power of profit as motivator.
• Most importantly, consider the relationship.

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PBSC Step 6 Select the right contractor.

• Tasks, Features, Best Practices
• Compete the solution
• Use down-selection and "due diligence."
• Use oral presentations and other opportunities to
  communicate.
• 
  

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PBSC Step 6 Select the right contractor.

• Tasks, Features, Best Practices (cont)
• Emphasize past performance in evaluation.
• Use best-value evaluation and source selection.
• Assess solutions for issues of conflict of
  interest.

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PBSC Step 7 Manage Performance

• Tasks, Features, Best Practices
• Keep the team together.
• Adjust roles and responsibilities.
• Assign accountability for managing contract
  performance.
• Add the contractor to the team at a formal
  "kick-off meeting.

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PBSC Step 7 Manage Performance

• Tasks, Features, Best Practices (cont)
• Regularly review performance in a Contract
  Performance Improvement Working Group.
• Ask the right questions.
• Report on the contractor's "past performance."