By any name, prequalification has become standard fare

Bob Little

It's time we gave up and recognized once and for all that vendor prequalification is the wave of the present.

Have you noticed that no one ever submits a technical proposal for a contract anymore? It seems no one cares about how the vendor will get the job done.

More to the point, the only discriminators vendors face are whether each has ever done the job before, and, if so, how well. It's called past performance evaluation and it is supplemented by oral proposals in which the competitors get to show, um, off.

Some of you more cynical readers probably think the reason no one asks for technical proposals is that there is no one left who knows enough about the technologies to evaluate them.'The theory is that anybody can read a past performance scorecard; you don't have to know much to figure out that a disparity between two vendors in past-performance points may indicate a meaningful difference in ability.

Some of you less cynical readers probably think that the agency expertise gap'you saw it here first'is being more than adequately spanned by the ubiquitous consultant: He looks for all the world like one of us, but you know he is an alien with presumably higher intelligence, as is the case with all alien species.

The bad thing about consultants is that sooner or later they figure out that you pay the most for what you want to hear. Which, coincidentally, is what they've taught you to listen for.

It's time to get rid of the silliness of past performance ratings and the low self-esteem of the federal work force created by a surfeit of consultants, and take action toward what the government has been essentially doing anyway'prequalifying companies. That's right, the government has been doing it all along; it just called it something else.

What's in the name IDIQ? Whatever it is, it smells like prequalification when it involves multiple-award task or delivery order contracts. Here's this one contract awarded to three companies for the same effort. They can't all be doing it. And everybody knows that a contract with no specifications, work statement, delivery date or price isn't a contract at all.

Yet everyone pretends it is, like an audience at a play when it suspends disbelief.

The same goes for Multiple-Award Schedule contracts. With $100 as the minimum, you're hardly going to get other than a qualifying price, and everyone knows it. Companies begin marketing to force competition among the prequalified companies even though it doesn't have to happen. The result is competition, more or less, among'and limited to'the prequalified companies.

The government assumes that the awardees of these imaginary contracts will compete for the work. We're not talking collusion, necessarily, but rather that age-old practice of cherry picking. You can't make companies compete for the task and delivery orders, but they can decide whether to play and how much to risk.

Their criteria can be to pursue only the large or the small deals, or the long-term or short-term undertakings. They can wait until their competitors are booked before they respond to requests for quotations. Or, companies merge and agencies then get to pay a premium for the right not to compete'which is, the way of things.

Now's the time

Despite its shortcomings, prequalification is an idea whose time has come, even if by default. The simple truth is that there are too few people to run the acquisition system. With a logic that makes voodoo economics worthy of a Harvard doctoral program, the powers that be have decided that truly open competitive acquisition is passe. The U.S. Open has become the U.S. Invitational. More's the pity.

Bob Little, an attorney who has worked for the General Accounting Office and a Washington law firm, teaches federal contract law. E-mail him at [email protected].


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