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Here’s how to raise your win rate by 20 percent

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January 11, 2012 by cs

All executives want to increase their win rate. If you could raise your company’s overall win rate by 20 percent, the payoff in additional revenue, earnings and shareholder value could be huge. Company revenues would increase, earnings would increase by the marginal profit rate on the new revenue, and shareholder value would increase proportionally to your increase in earnings.
But knowing which investments to make and predicting the payoff is the challenge. Here’s how to choose your investments and predict the resulting increase in win rates.
First, let me make sure everyone understands that we are talking about the investment you make to improve your company’s overall win rate. This is the average win rate on all proposals your company submits, not your win rate on a specific proposal. (We use a different model to predict the outcome for individual bids.)
7-Factor Model
To predict increases in overall company win rates, we use a 7-Factor model. Since we are not aware of any other models that do this, we’ve called it the Lohfeld 7-Factor Company Win Rate Model.
While the model predicts overall company win rates, more importantly, it also predicts how a company’s win rate is affected by changing investments in these 7 factors—and that’s what we’re after. If we can predict how the win rate is affected by changes in the 7-Factor score, then we can make investments with confidence, knowing that we can predict the resulting win-rate increase.
The 7-Factor score is based on:
  • People: The skills and experience of the people involved in creating proposals.
  • Business acquisition process: Business acquisition maturity covering the five stages of business acquisition lifecycle.
  • Tools: Proposal infrastructure and personal and productivity tools.
  • Management decision-making: Qualification and bid decisions.
  • Solution competitiveness: Competitive solution with good features and customer benefits.
  • Proposal quality: Quality proposals that are always compliant, responsive and compelling.
  • Winning culture: Winning culture with good work/life balance.
We assess each of the seven factors using four yes/no questions. Each yes answer contributes one point to a company’s overall score. A perfect assessment scores 28 points and, by the way, we have never seen a company earn all 28 points. Each question takes 15 seconds to read and answer. With seven factors and 28 questions, it takes seven minutes to complete the assessment to see how your company rates in each factor.
Here’s an example of how the assessment works. The first assessment factor is People. Skilled people write better proposals than those who are not so good at it. To assess the skill and experience of the people working capture and proposals, we ask four questions. The answers are based on the skill and experience of your internal staff as well as consultants you use.
RELATED MATERIAL
To take the full questionaire and receive a presentation that explains the 7-Factor Model, click here.

The first question is, “Does your capture and proposal core team include your best and brightest professionals, and do they know how to create winning proposals?” You get one point if your answer is yes and zero points if the answer is no. You get a second point if you answer yes to the question, “Are your Proposal Managers always well matched to their assignments and do they always have the right leadership qualities and experience level for the assignment,” (or if you don’t have the right person available from your in-house team, you go outside your company for proposal management support). You get a third point if you have a career development plan for your proposal professionals, which includes professional development and skills training. You get a fourth point if you can readily add additional proposal resources to augment your team to accommodate fluctuating workloads.

Answer each of these questions with a yes or no. Each yes gets one point, and each no gets zero points. If your answer is somewhere between yes and no, give yourself a half point. Once you complete your 7-Factor Assessment score, you’re ready to begin looking at investments.
Selecting investments to raise your win rates
Your strategy is to make company investments that will raise your 7-Factor Assessment score. The higher your assessment score, the higher your overall win rate will be.
To see which factors to improve, plot your scores on our Lohfeld 7-Axis Diagram. The Lohfeld 7-Axis Diagram provides a graphical representation of your assessment scores and shows at a glance those factors that need to be increased via investments. Invest in factors with the lowest scores first since generally they have a greater variety of investments that will raise your score. Make the least costly investments first with the objective of investing the least amount of money to get the highest increase in scores.
Let’s assume that a company wants to make investments to raise the People factor. If the scorers went back to their assessment scores, they might find that one of the contributing factors to the low score was that they didn’t have a professional development training program for their capture and proposal staff.
Since the company can implement such a program inexpensively, this should be their first planned investment. Similarly, they would use their assessment scores in the Process and Tools factors to guide them in selecting appropriate investments to raise their scores for these factors.
Using this approach, the company would build a plan of investments to raise its 7-Factor scores systematically and thereby raise its win rates.
Calibrating the model
To measure how much a company’s win rate increases with increases in 7-Factor scores, we worked with the Association of Proposal Management Professionals (APMP) and had 45 proposal managers assess their companies and correlate their assessment scores with win rates. We did this exercise at the APMP Nor’easters Chapter Fall Symposium 2011 and the APMP Southern Proposal Accents Conference. Our survey results solidly confirm that companies with higher 7-Factor Assessment scores had higher win rates.
From the APMP data, we found that government contractors with a 20 percent increase in their 7-Factor Assessment score on average yielded a 20 percent increase in their win rate. Clearly, government contactors should strive to increase their 7-Factor scores since the modest investment can produce large payoffs in new business revenue.
We also found that on average companies in the government market had 17 percent higher 7-Factor scores and 28 percent higher win rates than companies in the commercial space.
Perhaps government-market win rates track more closely to the quality of capture and proposal work, whereas commercial proposals are more broadly influenced by brand marketing.
Predicting Your Return on Investment
As a general rule, your win rate percentage will increase point for point with the increase in your 7-Factor score. This rule applies to companies that develop enough proposals each year that they have a good proposal team, some established processes and are doing reasonably well winning their share of bids.
Your company needs to have enough proposal volume to produce an economic payoff for making the investments. Your company also needs to have a reasonable win rate established as a starting point.
If you have a very low win rate, there may be other serious problems that need to be fixed before you fine tune your business-acquisition efforts.
Here’s what a typical company might expect. (Stick with me because there is some math here, but I promise nothing more complicated than multiplication and division.)
A typical government contractor graduating from the small business program might have $40 million a year in revenue, a 30 percent win rate, and a 16 for its 7-Factor score.
Let’s assume the company must generate $20 million in replacement revenue just to stay even and wants to grow revenue by 20 percent ($8 million) next year. To do this, the company must have $28 million in new revenue next year.
If awarded contracts have a nominal 5-year period of performance, then the company has to win $140 million in new business. If its win rate is 30 percent and the win rate doesn’t drop after graduation, then the company has to bid $466 million to produce $28 million in new revenue next year.
Now assume that the company selects investments that will raise its 7-Factor score by 20 percent with the expectation that this will result in a 20 percent increase in its win rate. Increasing the win rate by 20 percent means the win rate will go from 30 percent to 36 percent. This will produce additional revenue equal to 6 percent of all bids the company makes.
In this example, 6 percent of $466 million is an additional $30 million in revenue. If the marginal profit rate is 5 percent, the investments would drop $1.5 million to the company’s bottom line.
From a shareholder perspective, the additional $30 million in new business spread across a 5-year period of performance would bump up revenue by $6 million next year and could increase shareholder value by the same amount, assuming shares are valued at 1 times revenue.
Now compute the ROI. Assuming our example company needs to make $200,000 in investments to raise the 7-Factor score by 20 percent, and the revenue increase produced an additional $1.5 million to the bottom line, then the ROI ratio would be 7.5 to 1. I believe this is called a no brainer.
Make the investments and move on to enjoy your new-found prosperity.
About the Author: Bob Lohfeld is the chief executive officer of the Lohfeld Consulting Group. E-mail is robert.lohfeld@lohfeldconsulting.com. Published Jan. 5, 2012 by Washington Technology at http://washingtontechnology.com/articles/2012/01/04/increasing-your-win-rate.aspx?s=wtdaily_060112.

E-mail snafu no reason to disqualify company’s bid

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April 4, 2011 by cs

Rain nor snow nor flooded e-mail servers will stop the delivery of a contract proposal.

The U.S. Court of Federal Claims has ruled that the Army Corps of Engineers should not have disqualified a bid because it arrived via e-mail four minutes after the noon deadline.

The proposal from Watterson Construction Co. was held up because the Corps e-mail servers were in the midst of a “mail storm,” causing unusual delays in distributing e-mails.

Judge Susan Braden ruled that the company’s bid was not late because it “was both reached and received by the government’s e-mail servers before the due date.”

According to the decision, a mail storm is an “e-mail sent to a large number of users, a sufficient number of whom reply to all, flooding an e-mail system and disabling it.”

“Watterson’s proposal was improperly eliminated from the competition, as the disturbance in the Army Corps’ servers entitled Watterson to a one-day time extension,” Braden wrote in her ruling.

Braden wrote that today’s e-mails are sent instantaneously in the ordinary course of business, and a problem such as a mail storm is abnormal. The judge concluded then that the mail storm was an “emergency or unanticipated event.” As a result of the emergency, the Federal Acquisition Regulation extends the deadline to bidders for 24 hours.

“It is true that at the time proposals were due, the Army Corps Office was open for business and proposals could have been delivered by hand,” Braden wrote. “The court, however, does not construe the phrase ‘proposals cannot be received’ to mean that it must be impossible for the government to receive proposals, before the ‘emergency’ or ‘unanticipated event’ exception applies.”

– About the Author: Matthew Weigelt is acquisition editor for Federal Computer Week – published Mar. 31, 2011 at http://washingtontechnology.com/articles/2011/03/31/court-ruling-mail-storm-bid-proposal-deadline.aspx?s=wtdaily_010411 

Which words kill your best proposal?

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March 16, 2011 by cs

Here are some terms and language to avoid when responding to an RFP.

Weak language and clichés can be the death knell for your proposal. According to Visible Thread, a company that specializes in software that analyzes word usage in documents, your bid and proposal team should know the language that weakens credibility, raises legal questions or affects the delivery of your solution.

If you are using the following words and phrases in your proposals, it might be time to call for a rewrite.

Credibility killers

Wishy-washy language to avoid:

  • “Can provide.”
  • “Might provide.”
  • “May deliver.”
  • “We are committed.”
  • “We are pleased to.”
  • “Uniquely qualified.”

Liability red flags

Terms that convey legal implications or suggest overcommitment:

  • “Expert.”
  • “We guarantee.”
  • “Seamless.”
  • “Best of breed.”
  • “Best practices.”
  • “State of the art.”

Delivery trap

Words and phrases that are difficult to verify or measure:

  • “As appropriate.”
  • “As necessary.”
  • “Full service.”
  • “Quality focused.”
  • “Top-quality.”
  • “Efficiently.”

 

Source: Visible Thread

Published by WashingtonTechnology.com – March 9, 2011

Want to meet government buyers? Albany, GA is the place to be on Feb. 22nd!

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February 15, 2011 by cs

Ever heard of “speed dating” where couples are matched for short periods of time to see if the chemistry is right?

Well, through a unique event on February 22, the same principle is being applied – EXCEPT it involves matches between local businesses, government agencies, and prime contractors.

If you want the opportunity to meet with buyers from local, state and federal agencies, you can’t afford to miss this event!

On Tuesday, February 22nd, the Albany (GA) Civic Center is the place to put your best marketing techniques to work.  You’ll get a chance to meet with — and present your capabilities to — decision-makers and buyers from representatives of local, state, and federal government agencies, including the State of Georgia, the University System of Georgia, the Georgia Dept. of Corrections, the City of Albany, the Southwest Georgia Regional Airport, the Marine Corps Command, the IRS, the General Services Administration, and the federal departments of Commerce, Interior, and Juvenile Justice – among others scheduled to be in attendance.

Along with 15-minute one-on-one meetings with buyers and contracting officials, attendees will have a chance to attend briefings on each of these topics:

  • Business Communications, Elevator Pitches and Capability Statements
  • Reading and Responding to Bid Solicitations
  • The Do’s and Don’ts of Government Contracting
  • Government Market Research
  • SBA’s New Women Owned Small Business (WOSB) Certification Program

The featured luncheon speaker for this very special day is Ms. Pat Hanes, Regional Director of the Atlanta National Enterprise Center with the Minority Business Development Agency (MBDA) of the U.S. Department of Commerce.

Coffee and informal networking begins at 8:00 am.  The day’s program begins at 9:00 am and runs until 3:00 pm.

This event is completely free, so register now!  Simply click here to register and then hit the “Sign Up” button.

5 ways to shape how agencies pick winning proposals

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January 27, 2011 by cs

Agencies have broad discretion in establishing evaluation criteria for their procurements, subject to some limitations set by federal acquisition regulations. Those criteria are often shaped by arguments that competing contractors make during the procurement’s capture phase. Here are some ideas to consider in shaping the evaluation criteria in your next must-win procurement.

Factors and subfactors

Every procurement must be evaluated based on evaluation factors and subfactors established before the release of the request for proposals. The government tailors those factors and subfactors to represent areas of importance for source selection and provide a basis for meaningful comparison among competing proposals. Agencies have broad discretion in establishing evaluation factors and subfactors and determining the relative importance of those factors. As a capture manager, you want to discuss those factors and their relative importance and offer guidance to the agency, if requested.

Technical, management and other evaluation factors

Noncost evaluation factors must be established to assess the quality of proposed solutions, services or products. Those factors can include technical approach, management capability, personnel qualifications, prior experience or small-business participation, among others. Some agencies prescribe a standard set of evaluation factors for their procurements and then add factors specific to a procurement as needed. As a capture manager, you want to know what factors are required and what optional factors the agency might consider. After an agency selects factors, it tailors subfactors for each one to outline important considerations in the procurement and provide a basis for comparing bidders. Agencies have broad discretion to set subfactors for each procurement.

Past-performance evaluation factor

Past performance is a mandatory evaluation factor, and agencies must include it in every procurement that exceeds the value of the simplified acquisition threshold, unless the contracting officer specifically excludes it. The agency describes its approach to evaluating past performance and usually requires bidders to provide past-performance contract summaries for relevant contracts of similar size, scope and complexity. Past-performance selection criteria can be defined broadly or narrowly. For example, past-performance contract references might be restricted to contracts performed or completed in the past three years. Narrow definitions can eliminate some excellent contracts from being presented as past-performance examples.

For procurements that offer a significant opportunity for subcontracting, past-performance evaluation must include an assessment of how well the bidder met applicable small-business goals in previous contracts that required subcontracting plans.

Price as an evaluation factor

Price is a mandatory evaluation factor for contracts, including best-value procurements. However, its relative importance can vary. For example, when mission success is important to the agency, the relative importance of price in the evaluation criteria can be lowered in comparison with other evaluation factors. For commodity procurements or nontechnical services, the relative importance of price could increase. In the extreme, some procurements raise the relative importance of price to such a high level that the RFP will state, “Award will be made to the technically acceptable, lowest price (TALP) offeror.” That TALP evaluation criteria should never be used for technical or professional services. The RFP will state that all evaluation factors, when taken together, are significantly more important than, equal to or significantly less important than price.

Capture manager’s role in shaping the evaluation criteria

Capture managers should not leave evaluation factors and subfactors to chance. After an agency releases an RFP, those factors and subfactors are set and cannot be changed without considerable effort on the part of the agency. Shaping evaluation factors to highlight important considerations in a procurement can make the difference between your company being a winner or a loser.

About the Author: Bob Lohfeld is the chief executive officer of the Lohfeld Consulting Group. Published in Washington Technology on Jan. 21, 2011 

Recent large IT contracts could cut prices for government, experts say

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October 13, 2010 by cs

The Social Security Administration, Homeland Security Department, and the Centers for Disease Control and Prevention each have awarded during the past month multibillion dollar, comprehensive information technology contracts that could prevent the types of cost overruns that have long plagued projects of all sizes, according to some procurement experts.

The Office of Management and Budget has recently issued numerous policies to curb contracting waste, as well as directives focused solely on IT acquisition reform. None of the memos ban megacontracts, but they do instruct agency heads to renegotiate existing agreements for lower prices and reduce reliance on high-risk contract vehicles.

The three agencies engineered their pacts for an array of services in a way that would ensure competitive prices, ease of ordering and more consistency in contract administration, said Ray Bjorklund, chief knowledge officer at market research firm FedSources. SSA awarded a $2.8 billion contract to four vendors; DHS signed a $2.63 billion deal with one of 59 suppliers participating in a governmentwide contract program; and CDC entered into an agreement worth a potential $5 billion with 30 companies.

But while the trend of one-stop-shop jumbo deals might be positive for the government, it is not always beneficial for vendors that must pay more for a chance to participate in all the contracts.

The companies rack up additional bidding costs, as well as recurring sales and administrative expenses to track upcoming orders — which they sometimes recoup by raising government prices down the road, Bjorklund said.

“If OMB is trying to achieve a less risky contracting environment, I’d say these contracts do that. They’re less risky, [but] it doesn’t mean they’ve mitigated all the risks,” he said.

In each case, interested parties had to or will have to negotiate lower prices to win a contract. While DHS awarded its contract to Northrop Grumman Corp., the company already had competed to get into the huge Alliant program, which consists of a group of contractors authorized to provide governmentwide IT services.

The three projects are variations of multiple-award indefinite delivery-indefinite quantity contracts, in which the federal agency has the right to issue an unknown number of work orders during a given period of time.

At CDC offices worldwide, 30 suppliers that were named on Sept. 23 will have to vie for task orders in multiple categories of work during the next decade, CDC Chief Information Officer Jim Seligman said. Groups of three to 11 awardees will bid against each other for services, including information management, management consulting and IT infrastructure.

In addition, CDC officials said the contract reduces administrative costs by merging an existing support services contract and numerous other orders placed through various vehicles, such as General Service Administration schedules, the procurement agency’s list of companies approved to conduct government business.

Dispensing separate contracts saps time, energy and government resources, Seligman explained. “By consolidating these contracts and then having ongoing competitions will achieve better pricing,” he said.

DHS is paying Northrop Grumman to install networks at the agency’s new headquarters on the campus of the former Saint Elizabeths Hospital in Southeast Washington, according to a federal award notice issued on Sept. 23. The work probably will not cost more than $300 million during any one year of the 10-year contract, according to Bjorklund. “Multibillion dollar contracts don’t equate to multibillions in a single year,” he noted.

SSA officials have said they will replace any of the four companies that perform poorly during its seven-year technology refresh project, so no contractors are guaranteed continuous pay. “The fact that there is an ability to fire a contractor means that the competitive practices are still at work,” Bjorklund said. The contract was awarded on Sept. 10 to Accenture, Computer Sciences Corp., Lockheed Martin Corp. and Northrop Grumman.

Agency IDIQs simplify the contracting process for the government, but they can complicate the bidding process for contractors, which must repeatedly submit proposals to get into each pool of potential money.

“I don’t think a lot of people in government are sensitive to what impact it has on industry,” he said. “When you start making contractors incur more expenses, many of those additional expenses are rolled up into future pricing.”

Meanwhile, some good government groups view all billion-dollar projects as risky. “They should all be examined thoroughly” by White House officials, said OMB Watch Executive Director Gary Bass, a critic of federal contracting.

The Obama administration “expects all agency IT contracts to be well-planned, well-managed and deliver successful results on time and within budget,” said OMB spokeswoman Moira Mack. “When that does not happen, agencies are expected to make timely and effective interventions to remedy the deficiencies in contractor performance.”

– By Aliya Sternstein - NextGov.com –  10/04/10 – © 2010 NATIONAL JOURNAL GROUP, INC. ALL RIGHTS RESERVED

Pentagon: Tanker bid “not a high school homework assignment”

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August 12, 2010 by cs

The Air Force did not deliberately block U.S. Aerospace from delivering its aerial refueling tanker bid on time, according to Pentagon Press Secretary Geoff Morrell.

The Air Force rejected U.S. Aerospace’s bid for arriving just after the deadline of 2 p.m. on July 9.

In protesting that rejection, U.S. Aerospace said its courier was at the appropriate base by 1:30 but got held up, perhaps deliberately, from reaching the right office in time.

“(T)he notion that any United States military personnel deliberately impeded their ability to deliver a bid, for this competition, is absolutely absurd,” Morrell said in a news conference Thursday, Aug. 5, 2010.

“Listen, the other two companies that bid on this went to great measures to ensure that their bid arrived at the prescribed time of 2 p.m. on July the 9th at Wright-Patterson Air Force Base,” Morrell said. He noted that EADS flew its bid in the day before the due date and also drove another copy to the base, and that Boeing delivered its bid at 9 a.m. “I don’t know the precise chronology of the arrival of this other company’s attempted bid, but the bottom line is, they didn’t make it in time. And there are very strict contracting rules that the federal government has on the books that preclude us from even considering bids that do not arrive by the prescribed time. So our hands are tied here. And, you know, I think any professional contractor understands how hard and fast these deadlines are and go to extraordinary measures in order to ensure that they are there well before those deadlines. As I said yesterday, this is a $30 to $40 billion contract. This is not a high school homework assignment, okay? These deadlines count, and any professional contractor understands that. … (T)here was ample opportunity, ample warning, for people to get bids in if they were serious about competing for this contract.”

The protest will not delay the contract, Morrell said. “We will award this contract in the fall, as we always said we would.”

– from Seattle PI – http://blog.seattlepi.com - Aug. 6, 2010

What do those symbols mean in my bid match “search profile”?

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July 26, 2010 by cs

Clients of the Georgia Tech Procurement Assistance Center (GTPAC) enjoy the benefit of being enrolled in a powerful electronic bid match service.  Each day, this service compares each client’s interests and capabilities against a huge database of government contract opportunities. Every time there’s a match between a client’s line of work and the purchasing needs of a government agency, GTPAC sends an email alerting the client to the potential opportunity.

[Note: If you are not registered with GTPAC, be sure to read http://gtpac.org/about to learn how you can qualify to become a client.]

For those Georgia businesses who are GTPAC clients, you probably know that the bid matches we send you are based on an electronic Search Profile we’ve created for you.  You should periodically examine your Search Profile to ensure that it contains search terms that describe your current business interests.  This review and editing process is known as fine-tuning.  You can request a copy of your Search Profile from your GTPAC Procurement Counselor.  Any changes you wish to make can be submitted to your Procurement Counselor for prompt processing.

When you review your Search Profile, you will notice that there are various symbols used in the coding.  The language and symbols used in your Search Profile are written in what’s known as “Boolean Logic.”  For example, < and > is known as a “proximity symbol.”  These greater than and less than symbols require the proximity of two words. Here’s an explanation of what that means:

If a search line says select fire<2u>hydrant, that coding is designed to look for any bid opportunity containing the words “fire” and “hydrant,” in any order, with no more than two words separating them. If  <3u> appears, then no more than three words could separate the two key words. If the coding line contains no number between the <>, like select fire<>hydrant, then only bids containing the exact phrase “fire hydrant” will be identified.

Here’s an explanation of some other coding:

* – The asterisk is a wildcard which substitutes for any additional number and combination of characters. So, select extinguish* will match on extinguish, extinguished, extinguishers, and extinguishing.

? – The question mark wildcard substitutes for one additional character. So, select hose? will match with hose and hoses.

and – “and” between two search terms requires bid opportunities to contain both terms. Therefore, select fire and hydrant will match on any bid containing the word “fire” and the word “hydrant.”

or – “or” between two search terms requires bid opportunities to include at least one of the terms. Therefore, select hydrant or extinguisher will match on any bid containing one or both of these words.

not – “not” can be combined with the “and” operator to exclude bids that contain a particular word. So, select hydrant and not fire will identify any bid containing the word “hydrant” that does not also contain the word “fire.”

Another thing to keep in mind as you review your Search Profile is that it contains NAICS codes and PSC/FSC codes.  Known as “procurement codes,” NAICS and PSC/FSC codes are the sets of numbers government agencies assign to literally every product and service that they buy.  The words that your Search Profile contains are looked for inside the numerical categories set forth by NAICS and PSC/FSC codes.  For that reason, it pays to periodically update your NAICS and PSC/FSC codes.  You can look-up your codes by clicking on the links below:

NAICS code look-up table

PSC/FSC code look-up table

You don’t need to become an expert in actually putting together your Search Profile – we’ll take care of the special programming for you.  But it’s important for GTPAC clients to understand the basics of how your Search Profile is constructed so that you can review it and make sure — with your Procurement Counselor’s help — that it’s kept up-to-date.

© 2010 Georgia Tech Procurement Assistance Center – All Rights Reserved.

Boeing, EADS spend $125 million lobbying for AF tanker contract; submit 8,000-page bids

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July 19, 2010 by cs

In order to snatch the lucrative U.S. Air Force tanker contract, Boeing and its European rival EADS have spent nearly $125 million on lobbying in the past years.

Boeing and European Aeronautic Defense and Space Co., the parent of European plane maker Airbus, have been locked in a 9-year battle over a $40 billion contract to outfit the Air Force with 179 in-flight refueling tankers. For EADS, winning the contract could mean gaining a stronger foothold in the world’s largest military market. Naturally, Boeing wants to prevent that.

In a bid to increase chances for their respective bids, the companies have spent more than $100 million on lobbying U.S. decision makers, figures from OpenSecrets.org, which tracks lobbying in U.S. politics, indicate.

Boeing during the past four years spent $54 million on lobbying efforts. EADS and its U.S. partner Northrop Grumman in the same period spent nearly $70 million on lobbying, OpenSecrets.org says. Northrop Grumman pulled out of the bidding in March, arguing the bidding conditions clearly favor rival Boeing.

Moreover, the companies spent several millions touting their planes in ads in newspapers, magazines and broadcast outlets.

Both Boeing and EADS this week submitted their official bids for the contract, a move that is linked to even more costs. The Hill, a Washington newspaper, reports that EADS North America spent $75,000 on printing its bidding materials. The company printed 50,000 pages — six copies of its bid of more than 8,000 pages. Each set weighs around 100 pounds, the newspaper reports.

The Air Force has been eager to replace its Eisenhower-era tankers and is to announce a bid winner this fall.

The Europeans are throwing their KC-45 tanker, a large plane based on the Airbus A330, in the race. Boeing is bidding with an altered version of its 767, called New Generation Tanker.

The Generation Tanker is slightly smaller and probably cheaper than the KC-45; the European plane has logged more flight testing hours and is closer to serial production, experts say.

Both companies have argued that winning the contract would create and support thousands of U.S. jobs, in a bidding war that goes back several years.

The KC-45 won the contract in February 2008 but the decision was overturned four months later by the Government Accountability Office after Boeing challenged it. The GAO said it found problems with the bidding and the contract is up for grabs.

Moreover, both sides are accusing each other of profiting from illegal government subsidies.

– Published: July 14, 2010 at 8:45 AM © 2010 United Press International, Inc. All Rights Reserved. 

Find Davis-Bacon in federal construction contracts, not in a supermarket

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June 7, 2010 by cs

There is hickory bacon.  There is turkey bacon.  And then there is Davis Bacon. 

The first two can be found in the meat department of your local supermarket. 

The last one — Davis Bacon — is found in federally-funded construction contracts.  If you’re bidding on a federal contract or subcontract, you’d better educate yourself about this requirement. 

The federal Davis-Bacon Act (DBA) applies minimum prevailing wage classifications for all federally-funded or assisted construction projects. The U.S. Department of Labor creates wage classifications by the type of project for a specific type of worker.   (Although not the case in Georgia, also be aware of the fact that some state governments have adopted “little DBAs” requiring prevailing wages on state funded works.)

The worker classifications are crafted with broad job scopes, in order to be over-inclusive. These classifications have drawn the ire of many private construction firms, who complain about what they consider over-payment for non-specialized labor (i.e., paying a wire runner as a journeyman electrician). So, as many favor the DBA’s heavy wages – it can be crippling to an unprepared private firm’s profit margin.

To prepare, a construction professional must read and absorb the federal wage classifications that apply on their project – before bidding.  Wage classifications are prepared by state and by project, and are included in all federally-funded construction work.

If you are bidding a contract in the State of Georgia, you’ll need to check out the Georgia classifications.  For example, if you were building a non-residential structure, such as a government building, in Bibb County, you can see the applicable wage rates here.

If your Bibb County bid needs to include ironworkers to install your structural steel, you would need to bid them per hour at $24.04, plus $9.86 in fringe benefits (insurance, fringe, or even cash).  There are no real boundaries here – if a worker is involved in structural steel work, that worker is to be paid as an ironworker. If a contractor does not plan for this broad application, you’ll be facing penalties that are spelled-out under the Wage & Hour Act or Contract Work Hours and Safety Standards Act.  The penalties are stiff, providing for up to two times the amount of the unpaid or underpaid wages, plus interest.

The lesson here?  Like with all things involving government contracting, do your homework before jumping in with both feet.  To obtain assistance, check with a representative of the Georgia Tech Procurement Assistance Center (GTPAC) nearest you.  With proper preparation, you’ll be able to bid correctly, win a contract or subcontract, and then be able to bring home the real bacon.

© 2010 Georgia Tech Procurement Assistance Center – All Rights Reserved.

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