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WILLIAMSBURG, Va. - A draft report containing a congressionally chartered panel's recommendations on acquisition reform will be publicly available within a few weeks, the chairwoman of the committee said Monday.

One widely anticipated portion will deal with performance-based contracting, an acquisition technique mandated by the Office of Management and Budget under which government officials outline the results they need on a particular project and develop measures to gauge contractors' success at meeting those objectives. The measures and incentives for meeting them in theory spur good outcomes. But in practice, that is not always the case.

While the idea of performance-based contracting and the techniques for using it are not new, "the job just isn't getting done the way we expected it to," said Marcia Madsen, chairwoman of the Services Acquisition Reform Act Advisory Committee, speaking on a panel at the annual Executive Leadership Conference, hosted by the American Council for Technology and the Industry Advisory Council. Government Executive is a co-sponsor of the event.

Research by the acquisition committee shows that about 42 percent of government contracts reported as performance-based are in fact not.

"You would think that we have a handle on it by now, but we just don't," said Melissa Rider, principal assistant responsible for contracting at the Army Intelligence and Security Command, and an advocate of performance-based contracting.

Effective use of the technique requires upfront collaboration between contracting and program management officers, but such cooperation hasn't always existed, its advocates say. "We need to get folks to say what the heck they want to get out of [a procurement] and what is the value to the government," Rider said.

With that objective already defined, developing metrics to track vendor performance should not be that difficult, Rider added.

But performance-based acquisition still remains unfamiliar to contracting officers to the degree that "we just need to slow it down a little bit," said Bob Suda, the Agriculture Department's associate chief information officer for integration and operations. "We're still in growing pains on doing major projects."

COMMENTS

• The problem with succeeding at performance-based contracting is the same problem that kept us from succeeding with other contracting approaches. We are often incapable of thoroughly delineating what we want, why we want it, and how we'll know whether we got it. The article quotes: "We need to get folks to say what the heck they want to get out of [a procurement] and what is the value to the government." Many of us couldn't do it then, and can't do it now. Performance-based contracting calls for the up-front application of knowledge and skills that are largely absent among those charged with acquisitions -- requiring their use does not magically make them available. Another thing: Contracting is so labor-intensive and lengthy that merely getting a contract in place is seen as an end in itself, rather than a milestone toward a true outcome. The ability to navigate an agency's "contracting administrivia" is seen as perhaps the most critical body of knowledge for someone seeking a contract. Most any contracting approach can be effective if done with due regard to outcomes. The performance-based approach seeks to inject elements that should have been there all along. But, when you're on the receiving end of such dictates, and the ability to fully document expectations and how success will be quantified has never before been emphasized, valued or rewarded, it looks more like the addition of complications to an already overly-complex process. There are fundamental knowledge gaps that need to be addressed before any contracting vehicle will live up to its hype. EJC in ATL GovExec.com reader Posted October 31, 2006 8:04 AM