20 teams tapped for services buy

The National Institutes of Health awarded five-year contracts to 20 teams of vendors last week in its experimental Chief Information Officer Solutions and Partners (CIOSP) program giving some 250 companies a shot at task orders that together are worth an estimated $100 million or more.

The closely watched program is one of the most ambitious to date to test new contracting techniques allowed under recent procurement reform legislation. The pacts developed in consultation with the eventual winners offer NIH and other agencies a broad array of technology and services and could be used to fulfill their most common information technology requirements.

Vendors who were chosen from a pre-qualified list of competitors said the program could revolutionize how agencies choose contractors.

"Five years from now people might look back on this and say this is a watershed moment " said Barry Landew senior vice president with Systems Research and Applications Corp. one of the winners.

William Kovacic a law professor at George Mason University said the structure of the CIOSP program is close to the way private companies deal with their suppliers - an approach championed by reform advocates. Private firms "don't go about it in a formal way but they have a short list [of vendors] and commit themselves to deal with people on the short list " he said. "If you want to get on the short list it takes an enormous effort."

Under such a system buyers have broad discretion to choose which suppliers will get work Kovacic said which has raised concerns among observers and participants in the program about whether tasks will be distributed fairly.

"A key thing to monitor over the course of the experiment is to develop some sense that the choices the purchasing agencies make [do not] neglect valid alternatives that ought to be taken into account " he said.At a contract-signing ceremony last Tuesday CIOSP program manager Manny DeVera indicated NIH expects the program to receive much scrutiny.

"With anything new there are always critics out there so it's [incumbent upon] us in NIH to control the administration well ...and it's also [incumbent upon] you to be open [and] provide us with all the information for the task orders " he told the contractors.

In an interview De Vera said that once the program gets under way NIH would probably ask an oversight group such as the General Accounting Office to review how well CIOSP is being run.Steven Kelman administrator of the Office of Federal Procurement Policy said the number of contracts NIH awarded would make CIOSP a "challenge" to manage. An advocate of multiple awards he said he had not envisioned agencies would award so many contracts under one program but that "there should be a fair bit of experimenting.

"More variation at the beginning is better than less variation because you are more likely to end up with something that works " Kelman said.

Each of the 20 teams will provide services in eight task areas: contract management data center operations support services integration services telecommunications development of telecommuting networks computer security and support for Year 2000 software conversions. Contracting officer Gale Greenwald said NIH would compete most task orders among at least three teams but no one team is guaranteed more than three awards during the life of the contracts.

The program is limited to 5 000 tasks which Greenwald said is the volume the contracting office determined it could handle.

As in other multiple-award programs such as the Pentagon's Defense Enterprise Integration Services buy vendors will be chosen to bid for tasks initially based on the capabilities they bid in their proposals. But as time goes on firms will be selected to compete based on how well they performed on earlier tasks with less weight given to the expertise they originally offered.

Customers can ask to steer tasks to specific vendors if they meet one of several exceptions allowed under the "fair opportunity" provisions of the Federal Acquisition Streamlining Act of 1994: that the need for the service is too urgent that only one vendor can meet the requirements or that the task is a "logical follow-on" to earlier work that the vendor won through competition.

Winners said the amount of business they get will depend on how well they market their expertise and on what they produce.

"In this new environment marketing and customer relationships are becoming more important [as is] the delivery of services " said Brendan Keegan director of business development for government services with Electronic Data Systems Corp. "Government executives now have many choices to go to."

CIOSP has several unusual features. First NIH pre-qualified 29 vendors that it said would be eligible to bid as prime contractors. Then this group of vendors met with NIH to help the agency draft its solicitation.The solicitation was not released in final form until about a week before final proposals were due. Meanwhile on the basis of oral presentations and a review of vendors' past contract performance NIH advised each vendor of its chance of receiving a prime contract.

Nine vendors decided not to submit final proposals and joined other teams as subcontractors De Vera said. Those companies include AT&T Booz-Allen & Hamilton Inc. Bell Atlantic Computer Data Systems Inc. Lockheed Martin Corp. PRC Inc. System Resources Corp. Vitro Corp. and Wang Federal Inc.From beginning to end the procurement took four months.

Greenwald is reviewing between six and eight task orders proposed by NIH offices.

- John Moore contributed to this report.