(a) The Integrated Acquisition Review Board is the decision authority to be executed at the milestone review points for all major PBL acquisitions. The reviews associated with each milestone point will typically address business and acquisition strategies, risks, trade-offs, and the assessment of exit criteria as the acquisition progresses through the phases. The reviews are geared to be streamlined and will only require the information specified by the SPE. (See Subpart 7.1; 7.104-90)
(b) Thresholds
(i) The table listed below depicts threshold levels and other criteria for approval at the HQ and field level, including review and coordination requirements.
PBL ACQUISITION REVIEW THRESHOLDS
$Threshold *
|
Other Criteria
|
Review/Coordinate
|
Acquisition & BCA Approval Level
|
> $5M - $20M
|
|
Field Activity Level
|
Chief of the Contracting Office
|
> $20 - $50M
|
|
Field Activity Level
|
Head of Contracting Activity or designee**
|
> $50 million
|
|
HQ DLA/J-72
|
I-ARB
|
All
|
DLA/Military Service Partnerships
|
HQ/DLA J-72
|
I-ARB
|
* Value of base period and option periods.
** Delegable to a level above the Chief of the Contracting Office
(i) The SPE retains the authority to review any high-visibility, special interest acquisition.
(c) Waiver of Integrated Acquisition Review Board Review and Approval Requirements
(i) Waiver of I-ARB review and approval requirements may be requested by the Chief of the Contracting Office, under exceptional circumstances. The request for waiver shall be submitted to the DLA Supplier Operations Branch (J-72), must include the rationale and justification for the waiver, and should address the minimum requirements under each milestone, to the extent practicable. Waivers are granted by the SPE on a case-by-case basis.
Appendix A
Definitions/Descriptions
Alpha Contracting. An innovative contracting technique, typically used in satisfying sole source requirements, that transfers the acquisition process from a consecutive (and sometimes iterative) process into a more efficient and streamlined concurrent process. From solicitation development, through proposal preparation, to evaluation, negotiation, and award, Alpha contracting relies on a team approach to concurrently develop a requirement through award and implementation. Information on Alpha contracting can be found from a wide variety of sources through the search function of the DoD Acquisition Deskbook, accessible from the OSD AcqWeb homepage or http://www.dau.mil.
Business Case Analysis (BCA). A comparative analysis that presents facts and supporting details among competing business alternatives. The BCA should facilitate a determination whether to implement a PBL type arrangement by comparing the Government’s cost of supporting the initiative versus the contractor’s cost of supporting the items or material. There are two types - abbreviated (rough order magnitude (ROM)), and final BCA.
Corporate Contract. A long-term contract that aggregates requirements of more than one ICP or Military Service with a single supplier. A corporate contract can support both DLA direct (DLA owns inventory) and/or customer direct (vendor holds inventory). (Note: DLA direct and customer direct are Business Systems Modernization Program terms.)
Customer Wait Time (CWT) - This measures the elapsed time from the issuance of a customer order to the satisfaction of that order.
Integrated Acquisition Review Board (I-ARB). The I-ARB is the decision authority to continue the acquisition, modify the strategy, terminate the process, or determine how to proceed into the next phase of the acquisition. (See Subpart 7.1; 7.104-90)
Integrated Product Team (IPT). Team composed of representatives from appropriate functional disciplines working together to build successful programs, identify and resolve issues, and make sound and timely recommendations to facilitate decision-making. There are three types of IPTs: overarching IPTs (OIPTs) that focus on strategic guidance, program assessment, and issue resolution; working level IPTs (WIPTs) that identify and resolve program issues, determine program status, and seek opportunities for acquisition reform; and program level IPTs that focus on program execution and may include representatives from both government and industry.
Long Term Contracts. An indefinite-delivery type contract in excess of one year (including options) with delivery orders. DLA direct and/or customer direct.
Performance Based Logistics (PBL) acquisition. Acquisitions of material and/or logistics support (such as inventory management, storage, materiel handling, and transportation)(customer direct or DLA direct) where performance is evaluated based on measurable outcomes to ensure improved readiness, availability, or reduced overall costs to the customer and DLA. PBL acquisitions may include long term contracts, prime vendor contracts, virtual prime vendor contracts, and corporate contracts.
Prime Vendor/Virtual Prime Vendor. A long term contract with a commercial distributor, original equipment manufacturer (OEM), or third party logistics provider for integrated logistics support that may include forecasting, inventory management, distribution, engineering support, technical services or other services to support customer needs. Normally includes performance metrics. Customer direct.
Service Partnerships. An arrangement between a Military Service and DLA to award or modify a single performance based logistics contract consisting of both DLA NSNs and Service NSNs.
Strategic Material Sourcing (SMS). SMS is DLA's umbrella initiative that targets a relatively small subset of the total DLA-managed hardware items based on those NSNs that drive the Agency’s business and/or have a potential impact on readiness. SMS encompasses all of the Agency's "Shift to Commercial Practices” initiatives for hardware items, e.g., Strategic Supplier Alliances, Corporate Contracts and other long-term agreements. The initiative is based on expanding DLA’s successful adoption of commercial practices for energy and troop support items by developing and applying similar corporate strategies and techniques to the hardware commodities. The attached White Paper provides an overview of Strategic Sourcing, which is the commercial sourcing strategy that forms the basis for SMS.
Strategic Supplier Alliances. One of the key tools within the SMS umbrella. They involve long-term partnerships between DLA and major sole source suppliers that establish a collaborative relationship to accomplish a mutually compatible goal. SSAs involve true corporate-wide arrangements that entail identifying process changes beneficial to both parties, aligning purchasing with manufacturing and establishing performance based objectives. The overall goals of the SSA approach are improved availability, reduced customer wait time, reduced inventory, and reduced total price.
Appendix B
Regulation, Guidance, Best Practices, Sample SOWs, and Templates
Federal Acquisition Regulation (FAR). FAR Subpart 37.600 prescribes policies and procedures for the use of performance-based contracting methods.
Defense Federal Acquisition Regulation (DFARS). DFARS Subparts 237.601 and 212.102 permit contracting officers to use FAR Part 12 for performance-based contracts for services under certain circumstances.
The Office of Federal Procurement Policy (OFPP). OFPP’s ARNet website -http://www.arnet.gov/Library/PreSolicit/presolicit.html offers a variety of information on performance based service contracting (PBSC) such as guidance on Best Practices for Performance-Based Contracting, Final Edition, October 1998; OFPP Report on the Performance-Based Service Contracting Pilot Project, May 1998; and OFPP Memorandum, Subject: PBSC Checklist. Templates and samples are also available.
Seven Steps to Performance Based Acquisition. This guide, geared to the greater acquisition community (especially program offices), breaks down performance-based service acquisition into seven simple steps.
n Establish an integrated solutions team
n Describe the problem that needs solving
n Examine private-sector and public-sector solutions
n Develop a performance work statement (PWS) or statement of objectives (SOO)
n Decide how to measure and manage performance
n Select the right contractor
n Manage performance
Located on the following website, http://oamweb.osec.doc.gov/pbsc/index.html , the guide also includes several links to performance-based acquisition sites which include samples and templates.
U.S. General Services Administration. GSA’s portal provides several agency websites which link to a variety of sources of information on performance-based acquisition (includes samples and templates):
http://www.gsa.gov/Portal/content/pubs_content.jsp?contentOID=121260&contentType=1008&cid=null
U.S. Navy. Information on the Navy’s Performance Based Logistics’ Acquisitions is available at http://extra.navicp.navy.mil/scs/pbl.html. The information contained within this extranet site includes SOWs as well as performance and supply chain metrics.
Deputy Under Secretary of Defense for Logistics and Materiel Readiness. Product Support for the 21st Century: A Program Manager’s Guide to Buying Performance. This guide presents a performance-based logistics (PBL) strategy for product support of weapon systems. The guide is a tool for program managers as they design product support strategies for new programs, major modifications, or as they reengineer product support strategies for legacy weapon systems.
The Under Secretary of Defense Acquisition and Technology. Performance Based Services Acquisition Guidebook - January 2001. The Department of Defense (DoD) developed this guidebook as a cooperative effort among the components to help the acquisition team, and any other stakeholder, better understand the basic principles of PBSA and better implement performance based methodologies into service acquisition.
The Under Secretary of Defense. The attached guidance, Guide to Incentive Strategies for Defense Acquisitions - January 2001, amplifies existing policy regarding use of incentives in defense acquisitions.
The Office of the Secretary of Defense (OSD). OSD’s Rules of the Road: A Guide for Leading Successful Integrated Product Teams, located on the DoD Acquisition Deskbook website: http://acc.dau.mil/simplify/ev.php?ID=7224_201&ID2=DO_TOPIC , is a living document that facilitates organizing, leading, and participating in effective and efficient IPTs.
TABLE OF CONTENTS
PART 90
SUPPLEMENTAL PROCEDURES
