Contracting officer Col. Dave McKinney counsels other buyers to know their customers and the marketplace at large before selecting a contract

Col. Dave McKinney, like other contracting officers throughout the Defense Department, has a varied palette of contracting options at his disposal. And he acknowledges that he is amazed by the possibilities.

McKinney is director of contracting for the Headquarters Standard Systems Group at Maxwell Air Force Base, Gunter Annex, Ala. His contracting organization supports an annual budget of more than $450 million. The Standard Systems Group's role is to design, build or buy, install, and maintain combat support information systems for the Air Force and Defense Department. The group has acquired information technology products "used by virtually every organization on bases worldwide," according to an Air Force statement.

McKinney goes through a number of steps when evaluating the procurement possibilities. The first is straightforward: "Understand what you are buying," he said. That means getting a handle on customer requirements. "You need to know the statement of work and understand what market niche it falls into."

Once a customer's requirements are known, the next step is to understand the marketplace. To that end, the Standard Systems Group's contracting shop does market research in conjunction with its customers. "In the Air Force, we often use the term 'business adviser.' To be effective in today's environment, a contracting officer needs to know his or her marketplace — know who the prime players are and know what contract vehicles are available."

McKinney considers additional factors when selecting a contract to meet a customer's requirements. The customer's deadline is one of them. If a customer needs something next week, McKinney's group will find a vehicle that fits the customer's time constraints. The issue is "how fast a customer needs it and how fast [a given contract vehicle] can make it happen," he said.

That could mean looking beyond in-house vehicles. Contracting officers can "go to other agencies and use their vehicles," he said. Speed is one of the considerations that determine when and whether such an external move takes place, he added.

The need for fast order processing and rapid technology refreshment has compelled military contracting officers to sometimes pursue contracting alternatives beyond DOD. Industry observers say this drive has contributed to the rise of governmentwide acquisition contracts such as the National Institutes of Health's Electronic Commodity Store III and NASA's Scientific and Engineering Workstation Procurement III.

In addition to customer deadlines, McKinney said contracting officers also need to take funding strategies into account. Can a project be incrementally funded or does the money need to be available all at once? An IT services contract, for example, may not permit incremental funding. "If a contract vehicle doesn't allow it, then take it off the drawing board," McKinney said.

Contracting officers must also bear in mind socioeconomic factors — small, disadvantaged business contracting goals — when selecting vehicles. For example, the Standard Systems Group works with four such businesses through the Information Technology Services program. The Standard Systems Group's Commercial IT Product Area Directorate in late 2001 awarded four blanket purchasing agreements to four small, disadvantaged companies: Centech Group Inc., Multimax Inc., RS Information Systems Inc. and Sumaria Systems Inc. The service vehicle also includes five large businesses.

While McKinney and other contracting officers have customers to keep happy, they also have another constituent: the Pentagon. A recent DOD directive aimed at regulating the use of multiple-award contracts has put contracting officers on alert. The crux of the matter is so-called Section 803, a provision contained in the fiscal 2002 Defense authorization bill. DOD last fall published that provision as a procurement regulation, requiring contracting officers to seek at least three bidders on service task orders worth $100,000 or more.

McKinney said the initial reaction among contracting officers was one of fear. "The sky is falling," was the general feeling, he recalled. The main concern was that Section 803 would lead to a proposal evaluation nightmare. If a contracting officer were to solicit all the contractors on a services contract, would every contractor respond? One Air Force multiple-award contract has 98 vendors.

The flood of 98 bids failed to materialize, much to the relief of the contracting staff who envisioned a human resources crunch. Overall,

McKinney said he hasn't seen any change in the number of proposals submitted because of Section 803. "We were pleasantly surprised," he said. "We've not seen any impact yet."

One theory behind the lack of indiscriminate bidding: more widely circulated invitations to bid may have actually made contractors more choosy. Vendors, McKinney said, have been "forced into really reviewing what to bid on and have become more selective."

Contracting trends come and go, but McKinney has advice for contracting officers that transcends the changing face of federal procurement: "Go out and look for vehicles that have the most flexibility." In his view, contracting officers should emphasize best value over the lowest bid. "I'm not a big proponent of low bids," he said. Delivery time, past performance and specific skill sets may outsell lowest price.

And with so many contract vehicles to choose from, being selective is not just a good idea. It's a practical necessity.

Moore is a freelance writer based in Syracuse, N.Y.

Dave McKinney file

McKinney was commissioned a second lieutenant through the Air Force ROTC program in 1979. He holds a Level III acquisition certification in contracting along with a bachelor's degree in business from Mississippi State University and a master's of business administration from the University of Montana. Prior to his Standard Systems Group assignment, McKinney was deputy commander, 12th Logistics Group, Randolph Air Force Base, Texas.

McKinney's top six buying tips

1. Know the statement of work and understand the

market niche.

2. Know the key vendors and what contract vehicles are available.

3. Understand that the deadline, whether tight or

extended, will determine the contract to use.

4. Remember that some contracts do not allow incrementally funded projects.

5. Check out contracts with small and minority-

owned firms.

6. Emphasize best value, not low price, focusing on delivery time, past performance and specific skill sets.