Environmental Remediation Contracting Summary of a Symposium (1994) / Chapter Skim
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ESTABLISHING CONTRACTOR PERFORMANCE CRITERIA AND MEASURING RESULTS -- THE MOST CHALLENGING TASKS IN ANY ENVIRONMENTAL PROCUREMENT
ESTABLISHING CONTRACTOR PERFORMANCE CRITERIA AND MEASURING RESULTS -- THE MOST CHALLENGING TASKS IN ANY ENVIRONMENTAL PROCUREMENT
Pages 12-16
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From page 12... ...
Army Corps of Engineers OUTLINE THE CHALLENGE Introduction-The challenge Setting criteria-Knowing what we want Measuring performance~etting what we want Summary-Meeting the challenge Environmental Remediation is a Tough Ballgame: Conditions are generated over time Discovery is often spontaneous Extent of damage/danger is unknown Health/safety issues predominate There are more laws/rules than you can shake a stick at-And they vary by state/locale Personal and contractor liability is risky Issues become visible and politicized Technical Requirements are Hard to Define: Site assessment takes time and money-uncertainties often remain Subsurface conditions often predominate Technical solutions vary widely in process, price, and time Matching problem and solution has inherent risks Defining acceptable final conditions is judgmental Placing a Value on Contractor Performance is Difficult: How much are we Filling to pay for speed?
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From page 13... ...
Procurement Process Makes Life Interesting: · We can't relinquish sovereign responsibilities to contractors · We must comply with the norms of federal procurement equity, fairness, integrity, consistency, accountability Must be smart in the selection of the procurement vehicles to suit programmatic norms-risk management, performance, time, cost Setting Criteria - Knowing What We Want: . · Most important step in the process Careful planing effort Customer driven requirement Risk management approach learn all we can within constraints determine risk of uncertainties assign risks between government and contractor KNOWING WHAT WE WANT: · Acquisition planning · Conducted by a technical, procurement, and customer team determines technical performance criteria, cost, and time targets selects the appropriate contracting type determines the scope of work performs preaward evaluation · Determine desired end state review applicable environmental regulations consult closely with regulatory authority · Apply requirements carefully to site · Establish parameters necessary to achieve compliance · Determine constraints time health/safety 13
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From page 14... ...
funds - political Assess present conditions analyze site data define conditions in regulated parameters determine deficient areas-where possible qualify potential deficiencies-assign probabilities Determine certainty of technical performance, cost, and time criteria Select contracting type based upon this analysis, for example: low uncertainty/risk-firm fixed price uncertain site conditions but known value of technical performance, cost, and time criteria-cost plus incentive fee uncertain conditions and unknown or changing value of criteria-cost plus award fee MEASURING RESULTS - GETTING WHAT VVE WAND: Must translate criteria/needs to clear/binding contractual requirements Must rely on contractor profit motive Must structure contract to incentivize contractor in high value (to government) areas Must foster a businesslike climate between parties Must establish an oversight process commensurate with government's responsibilities GETTING WHAT WE WANT (WHEN THE VALUE OF CRITERIA IS KNOWN AND CONSTANT: Determine the most important technical performance criteria Describe minimum, target, and optimum performance levels Determine the value to the government for achieving performance above the minimum criteria level Determine the "sharing ration" between government and contractor · Build the formula into the contract in the fee determination process-in the OK or during negotiations Perform the same analysis for cost and time criteria Determine the relative values of trading off one criteria for another i.e., Increase technical performance at the expense of cost Document the trade-offs in fee determination table, curves, or Homographs Tie into contract 14
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From page 15... ...
-Collect data-prepare reports for PEB RULES OF THUMB: · Express requirement accurately = convey performance expectations · Emphasize reward-based incentives = reward successful performance · Motivate performance excellence = let the contractor manage and do the job · Cultivate communication and feedback = share agreements and differences · Keep it as simple as possible = be declarative and unambiguous SUMMARY - MEETING THE CHALLENGE: Government has a sovereign obligation to know what we want and get what we want for the taxpayer-government agents must perform the tasks that will ensure compliance with environmental regulations We must do our homework setting criteria structuring the procurement action determining risks and tradeoffs We must be accountable and professional 15
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From page 16... ...
· We must appreciate the contractor's world We must not relent until the job is done.
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