IS YOUR RFP D.O.A.?

IS YOUR RFP D.O.A.?

IPC CONFERENCE FOR THE PCB INDUSTRY: CRITICAL ISSUES FOR THE MILITARY MARKET

Washington, D.C. – 12.08.2011Steve DeWaters – Presenter

The Quest for the Request

RF’X’ RFQ = Request For Quote (Typically Commercial)

RFI = Request For Information (also ‘Pre-Solicitation’)…examples:

◦ US Army…inviting industry to provide information on potential topics for the XYZ Program. Industry responses to the RFI will be assessed and may assist in identifying potential future actions

◦ The Defense Advanced Research Projects Agency (DARPA) has released a Request for Information (RFI) to solicit ideas and information to support its 100 Year Starship Study™ program.

REA = Request For Equitable Adjustments◦ Modifications of the contract that were not

done formally or properly…

RFP = Request For Proposal◦ Also ‘Solicitation’

Example

Space Fence

(Space Surveillance Command)

Space Fence Configuration Nine sites located on a path across

the southern United States from Georgia to California along the 33rd parallel and consists of three (3) transmitter and six (6) receiver sites.

The main transmitting station located at Lake Kickapoo, Texas, has an average power output of 766,800 watts feeding a two-mile long antenna array. It provides the primary source of illumination.

Two other transmitting stationsare located at Jordan Lake, Alabama, and Gila River, Arizona. These stations, with average power output of approximately 40,000 watts each, improve low altitude illumination at the sides of the main beam.

It reaches straight up 10,000 miles into space with fan-shaped beams which are fixed in position, not scanned

A data processing center is located in Dahlgren, Va. Its observations are fed to NORAD Space Control Center.

~ 2 Miles

Lake Kickapoo, Texas Transmitter

Interferometer arrays of 12 antennas, each composed of 96 dipoles over a wire ground screen. With a 1700' baseline, the interferometer can measure the angle of arrival of the incoming radar signal to within .01 degree accuracy...every 10 seconds

RF’X’ Example: Space Fence

• Up to 2 Phased array radars

– S-Band, range & angles• Globally dispersed

– Increased revisit rates– Coverage gaps closed

• Detection capability– ≈ 10 cm objects– LEO: 250-3,000 km alt.– MEO: 22,000 km alt.

• Tracking capability for IOD

(IOD = Incoming Object Identification)

Space Fence

• Space Fence $1.5B - $2.5B• Pre-Solicitation (RFI) was Mar 11

• RFP release by Apr 12• Contract Award Aug 12

AFSSS

Source: Col. Brian Fredericksson, AF, 11/09/2011, HANSCOM AFB – Briefing 11.09.2011

1.5 yrs for the design phase

contract

1. From a 12 inch minimum to a 2 inch minimum

2. S -band ranges from 2 to 4 GHz, crossing the conventional boundary between UHF and SHF at 3.0 GHz.

The Buy SideAn enormous amount of coordination, time, planning,

strategy, manpower and MONEY goes into the preparation of Defense RFP’s

◦ $10-20M to develop a single RFP is not uncommon

There are specific processes/procedures that the defense contractor needs to follow…these must never be confused with what is ordinarily acceptable in commercial practices

There are usually many different RFP’s ‘in play’ at any given time….’multiplexing the tasks…& the ‘$’

OPPORTUNITY EVALUATION(From one of the Armed Services, Agencies, Primes, or FMS)

DEFINE SUBSYSTEM ARCHITECTURE

PARTITION OF SUBSYSTEM COMPONENTS

SUBCONTRACT STRATEGY / PLAN & STAFFING

SUBCONTRACT STRATEGY / PLAN & STAFFING

PARTITION OF SUBSYSTEM COMPONENTS

DEFINE SUBSYSTEM ARCHITECTURE

CUSTOMER DRAFT RFP

PRELIMINARY TASK DESCRIPTIONS & WBS

PRELIMINARY SPECIFICATION & SOW

PRELIMINARY SOURCE IDENTIFICATION

INITIAL SUBCONTRACT RFP

COMMENTS FROM SUBS

EVALUATE POTENTIAL SUBS

SECOND DRAFT TO SUBSA

The Subcontract Process…Source: John Kabanek, former BAE Systems Sub-Contracts Mgr., NCMA Instructor, Penumbra Team Mate

DOWN SELECT

A

NEGOTIATION AND SOURCE SELECTION

RISK MANAGEMENT

ONSITE TEAM

SUBCONTRACT MANAGEMENT

APPROACH

CONTROL PROCESS

SUBCONTRACT START UP

CHANGE MANAGEMENT

STATUS AND COST

SUBCONTRACT MANAGEMENT

FINAL BLT REVIEW EPP

CUSTOMER CONTRACT

AWARDBID

SUBMITTALCUSTOMER

EVALUATIONS

NEGOTIATE / AWARD

SUBCONTRACT

CLOSE OUT

DOWN SELECT

The Sell SideDiscover the Opportunities

Synchronize with the REALITY of the Opportunities◦ Understand the RFP Process (and the PACE)

Demonstrate Your Readiness (CONOPS)

Position for Pre-Award…Receive the Award

Create a Sustainment Plan

The Sell Side (Cont’d.) It costs the defense contractor a lot of ‘$’ to prepare their RFP’s….

◦ What does it cost you to prepare a good Proposal? Are you tracking that activity? (You should be)

Did you know that you can ask for those pre-award costs to be folded into the award?

This is not a general rule, but for complex RFP’s, it can be quantified and negotiated…accounting systems need to be robust

Cost-Reimbursement Contracts (aka: Cost-Plus Contracts)FAR Sub-part 16.301-3: Limitations

(a) A cost-reimbursement contract may be used only when—(1) The contractor’s accounting system is adequate for determining costs

applicable to the contract; and

(2) Appropriate Government surveillance during performance will provide reasonable assurance that efficient methods and effective cost controls are used.

(b) The use of cost-reimbursement contracts is prohibited for the acquisition of commercial items

Guaranteed D.O.A. Pit FallsNo Cover Letter

◦ Or one that is poorly written or disconnected from the RFP body

Cut-’n-Paste Proposals

Convoluted language or reinventions

Incomplete or Late submittals (Unqualified)

Commercial Responses

Not Questioning the ‘Question-able’

The Defense Contractor is not ‘Lilly White’, either…(Examples):

• Incomplete Documentation• Expired FAR Clauses• Unrealistic Turn-Around Windows• Unavailability or Detachment • 1st Tier Customer Audits

1. NEVER BE AFRAID TO CONTACT, CHALLENGE THE RFP AUTHORS….THEY ARE LOOKING TO YOU – THE SUPPLIER – TO NOTICE, NOTIFY, AND PERFECT

2. THAT DEMONSTRATES A PROBLEM-SOLVING MENTALITY: • THE 1ST STEP IN TRUST

Good Proposal Elements

TYPICAL PACKAGE…

STATEMENT OF WORK MANAGEMENT/SUPPLIER

PERFORMANCE VOLUME TECHNICAL VOLUME COST VOLUME VARIOUS ATTACHMENTS FTP’D OR OTHER DATA

Check ListCover Letter ‘Mapped’ ContentsNo cut-’n’-pasteUse a convincing

narrativeEmphasize value

propositionsUse logic/rationale…

◦ Explain your methods◦ Not just your willingness

Check List…For assuring that requirements will be assigned and for future use as a compliancy check on the Proposal…

The Proposal should be accurately and cleanly ‘mapped’ from the Cover Letter to the ‘Volumes’ and to any supporting documentation…

THIS IS YOUR INTERNAL TOOL TO

ORGANIZE YOUR APPROACH

1. Offeror shall provide a record of past performance of efforts that directly relate to the type of effort(s) requested by this RFP. The record shall consist of the name of the company or government agency customer that the effort was performed for and the year(s) of such performance. In addition, offeror is to provide a listing of all efforts performed within the last three (3) years for our company and/or any divisions thereof. Such listing to identify the specific customer location, point of contact by name and phone number and value of the order(s). If the listing is extensive a listing of the five (5) highest valued subcontracts is acceptable.

2. If offeror requires Government Furnished Equipment (GFE) and/or Contractor Furnished

Equipment (CFE), submit a list of GFE/CFE with the proposal and identify need dates. If offeror has an approved property control system, provide written evidence of the approval. If not, provide a copy of your company procedure for control of property.

3. Your proposal price shall separately identify all Special Tooling and/or Special Test

Equipment to be acquired for use in the performance of any subcontract resulting from the RFP. Provide unit prices, quantities, total price for each special tool/special test equipment item proposed, and identify need dates. Cost details, including vendor quotes or in-house engineering estimates to be provided. A description of each and its intended use/purpose must also be provided.

4. The following DFAR clause applies to any resulting Subcontract 252.225-7014 – Preference

of Domestic Specialty metals (APR 2003) Alternate 1 (APR 2003) Applicable if the work to be furnished hereunder contained specialty metals.

5. You are advised that an award may be made without any discussion of your proposal;

therefore, your initial submission should present your best price and technical position. 6. Report separately any royalty expense included as a cost element in your offer if the amount

of the royalty expense exceeds $250. 7. Offers must be in U.S. currency (stated in “then year” dollars respective to the year of

execution, unless otherwise identified). 8. __________________________ reserves the right to request a Best and Final Offer (BAFO). 9. The award will be made to the offeror that in _______________________________

judgment submits the best overall offer. 10. If the offeror will require the use of U.S. Government facilities either paid or rent-free,

provide alternative offers; one that includes the cost of rent for use of government facilities, another premised on rent-free use of the facilities.

11. _____________________________________ requests the offeror’s most favorable prompt

payment discount terms. Preferable (add number) % 10 Net 30 Days.

Cover LetterIt Is Essential

◦Allows Good ‘1st impressions’

◦Ties to the rigorous document

◦Maps to the supporting docs

Helps the CRT◦Saves Time◦Shortens the Decision

Process◦Reflects Well on the

Supplier

1. Data Rights Assertion

B. PROPOSAL INSTRUCTIONS

1. Two submittals are required; a technical/schedule volume and a business/cost & price volume. The technical/schedule volume to be in accordance with the Statement of Work (SOW) and Specification(s) and include a detailed schedule of events. The business volume to include your cost/price details is requested for the supplied and services as outlined in Enclosure 1 and all other provisions of this RFP. For each line item described in Enclosure 1, provide the unit price/cost, extended price, and associated lead time. Non-recurring engineering (NRE), if any, must be specifically identified in your proposal and proposed as a separate item(s) (broken down by cost element, e.g. Design, Qualification Test, Documentation, Preliminary Design Review (PDR), Critical design Review (CDR), etc.).

2. With any resulting order, _________________________________ and critical

Subcontractors will conduct conference calls as required to facilitate information exchanges and provide status reporting on all major efforts. Participants will include the Subcontracts Procurement Representative and the respective program/engineering representatives. The Subcontractor shall prepare and maintain a program schedule and monthly reports that depict program milestones, activities, events and the sequence that the work is performed in. The Subcontractor shall report progress towards the accomplishment of scheduled tasks, highlight significant events, and identify unresolved problems and actions. The reporting requirement stated herein may be supplemented by on site meetings at Subcontractors facility, and will be scheduled as required, at mutually agreed dates and times. These meetings will be scheduled to support specific technical and/or business discussions. Your proposal must breakout any costs associated with the identified meetings, including assumptions made in generating the proposed costs.

3. The type of proposal required in response to the RFP is (FFP or Cost Type). 4. Your proposal is due at the above address no later than _______________. Late offers may

be considered non-responsive. Earlier submittal of the technical/schedule volume is acceptable.

5. Your proposal must remain valid through _______________________. The anticipated date

of award is __________________. 6. Offeror must provide sufficient support for its proposal pricing to allow adequate

determination of price reasonableness within __ weeks after submittal of the business volume. A basis of estimate (BOE) and a bill of material (BOM) shall be part of this input.

7. Answer completely each element and items of information requested and explain and

justify any omissions. Any and all exceptions to the RFP must be clearly stated in your response, otherwise full compliance will be assumed and that no exceptions shall exist.

In Response, Reply To:

RFP # _________ Date: ______________

Subcontractor Name:

Subcontractor Address:

Attn: __________

Subject: _________________________

Reference: _________________________

Enclosures: Add Deliverables and Pricing & Cost Submittal Instructions Add Applicable General Terms & Conditions Add Applicable Prime Contract Special Provisions (H Clauses) Add Statement of Work Add Specification(s) and/or Drawings Gentlemen:

____________________________, solicits your support as a potential Subcontract source for ______________ Program.

Three (3) copies each of the proposal should be submitted to:

(COMPANY NAME) (COMPANY ADDRESS) ATTENTION: (NAME) A. DOCUMENTS INCORPORATED BUT NOT ATTACHED The following documents are incorporated herein and although not attached, apply to this RFP and any resultant subcontract. Where the words “(COMPANY NAME)” appear in this document or in any forms and terms and conditions, substitute (COMPANY NAME). Copies of these documents may be obtained by access to ______________________________, website at the following URL address: _________________________ or may be obtained from the __________________________________ Procurement representative.

1. _______________________________, Quality Assurance Codes. The following code(s) apply: _______

2. Packaging Codes: The following code applies: ________ 3. Supplier Shipping Instructions 4. Cost Accounting Standards Certification

Convincing Narrative & Explanations 2.2.2.2 Lean Expectations and Requirements

◦ XYZ Supplier shall have documented processes and metrics in place which, at a minimum, address the use of a capability assessment tool that monitors engineering and manufacturing best practices. The best practices include, but are not limited to, design for manufacturability/assembly/service (DFMA), and performance and process modeling and simulation, value stream mapping & analysis, work balancing, standard processes, visual controls, point-of-use staging, feeder/supply chain lines, employee empowerment & teaming, and defect/variation reduction.

POOR ANSWER:◦ XYZ, upon request, will provide objective evidence of striving to meet the above

expectations.

BETTER ANSWER:◦ XYZ believes in open communications and establishing strong working relationships to

establish program progress and to achieve the requirements of both the contractor and XYZ in an efficient and cost effective manner.

Specific evidence – examples of DFMA charts, value stream maps, and analytical data - supporting documented processes and metrics are found in Attachment B under corresponding section 2.2.2.2. Additional documentation also can be found there – under sub-section heading 2.2.2.2 (a) – providing evidence of a comprehensive employee training program for 5S Lean Manufacturing Principles.

The FAR/DFARS Federal Acquisition Regulations and Defense Federal

Acquisition Regulations System ◦ FAR is a set of rules within DFARS

The FAR contains hundreds of contract clauses implementing federal statutes and regulations. ◦ Those laws and regulations, as well as the clauses themselves,

require a prime contractor to incorporate—or “flow down”—certain clauses into subcontracts related to the prime contracts.

The primary factors in determining whether a clause must be included in a particular agreement are:◦ (a) whether the agreement is a “subcontract”◦ and (b) whether the flow-down is mandatory.

An Example of a ‘Trip Wire’…

52.223.13 Certification of Toxic Chemical Release Reporting is no longer an applicable FAR clause.

That is, it has been removed from the FAR. It is a fairly old clause (AUG 2003) and should not be seen on current solicitations.

Should check any other current RFPs received as it should not be part of terms and conditions unless the prime contractor has it in their contract as part of a follow-on effort. Even so, they should not have accepted it as a requirement. Many times the prime contractors do not update their documents (terms and conditions, applications for data base additions, etc) on a regular basis and instead do a "block update" every year or 2 years.

Contract Types The term "no-bid contract" is a popular phrase for what is

officially known as a "sole source contract“

A “cost-plus contract”, also termed a Cost Reimbursement Contract, is a contract where a contractor is paid for all of its allowed expenses to a set limit plus additional payment to allow for a profit

The term "fixed price" (as in: firm fixed-price contract) is a phrase used to mean that no bargaining is allowed over the price of a good or, less commonly, a service◦ Beware ‘REBATES’:

de riguer purchasing strategy…◦ Rebates tied to contract pricing is potentially hurtful to the supplier◦ Discount programs are better…tied either to past behavior or forward

accumulations Independent of time

SummaryRFP’s Are Expensive, Serious Efforts

◦CRT’s Are Looking for Like-Minded Suppliers

Contract Review Teams Look for Thoroughness, Ease-Of-Consideration, Value ◦CRT’s Do Not Have Time to Waste

Proposal Development Requires Thought/Care◦There Are Real ‘D.O.A. Pit Falls’ to Overcome

There Are Three Basic Contract Types

An Award is Only the Beginning…

Thank You

www.penstrat.com949.374.4130

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