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CHIPS Articles: Better Buying Power Nets Marine Corps $2 Million in Savings

Better Buying Power Nets Marine Corps $2 Million in Savings
By Carden Hedelt, MCSC Office of Public Affairs and Communication - March 3, 2015
MARINE CORPS BASE QUANTICO, Virginia—The spirit of competition in industry just saved the Marine Corps $2 million. By applying Better Buying Power guidelines, such as controlling costs throughout the product lifecycle and promoting effective competition, contracting officer John Wahl achieved a cost savings across two sustainment contracts.

“We got our incumbents on two logistics information systems contracts to come to us with revised pricing,” said Wahl, lead contracting officer for Global Contract Support System-Marine Corps. “That revised pricing was a 20 percent reduction on average across two contracts that are in sustainment.”

Sustainment budgets for logistics information systems are very small, said Dave Hansen, program manager for GCSS-MC, the primary technology provider for Marine Corps Logistics Modernization strategy using commercially available resource planning software. The program is managed by the Navy's Program Executive Officer for Enterprise Information Systems.

Because the logistics information systems programs are usually a few million dollars at most, a $2 million savings is significant. The savings to the federal government is a testament to Better Buying Power and Wahl’s adherence to its principles.

Wahl began his work back in November 2013. He recognized two contracts — for Marine Logistics Support Systems, or MLS2; and Storage, Retrieval, Automated Tracking, Integrated System, or STRATIS, both awarded in 2011 — that he thought could be revisited.

Between 2011 and today, much has changed; government budgets have fallen, and the demand for — and thus price of — specialized labor has declined as well, Wahl said.

Wahl saw an opportunity to reach for one of Better Buying Power’s focus areas: controlling cost throughout the product lifecycle.

“The contracts are flexible enough that, if we can find a more advantageous situation, then government isn’t tied down for several years,” Wahl said. “And given what we thought we knew about how the market could change, we thought it would be best to at least see what was out there.”

But to “see what was out there” wasn’t without potential pitfalls: How would the incumbent contractors take the news that Wahl was soliciting information from industry? If that solicitation did not result in a request for proposals, how would other members of industry who had spent time and money to put the initial white paper response together take it?

To address these concerns, Wahl made sure everyone was aware of his intentions throughout the entire process, starting with the incumbents.

“We met the incumbents to tell them we were putting out a request for information to industry, and that it was in no way a reflection on their work,” Wahl said. “We appreciated their work, which they completed as contracted, all of which was contained in the Contractor Performance Assessment Reporting System. But our directive from [Under Secretary of Defense for Acquisition, Technology and Logistics] Frank Kendall’s Better Buying Power is to get as much as we can for our money, and we thought we could do that.”

To get more out of MCSC’s money, Wahl tapped into another one of Better Buying Power’s directives: promote effective competition.

Wahl’s RFI went out in October 2014, and after giving out further information in online question-and-answer sessions, GCSS-MC held an industry day Nov. 5 in Albany, Georgia, to further explain the requirements to engage industry representatives, including the two incumbents.

“Our teams put together a well-thought-out walkthrough of our requirements for those contracts so companies could write better, succinct draft technical white papers to the requests we were looking for,” Wahl said.

After that walkthrough, members of industry met with GCSS-MC representatives to brief them one-on-one on what their respective companies could offer. Those companies turned in technical and price white papers later in November.

“The incumbents came back and said, ‘We can save you this much money’ on these two contracts,” Wahl said. “After comparing the revised incumbent pricing to the received industry price responses, we put those changes into effect immediately, which gives us that $2 million figure. They have one more option for next year.”

Wahl said the rest of the companies that participated in the industry day knew that even though there was no request for proposals that followed, they would be in a good position to compete for the MLS2 and STRATIS contracts in 2016.

“The work they did to put together these technical papers, the white papers, will still have a lot of good information when this contract has to be recompeted in 2016,” he said.

In some ways, everyone involved with these two contracts walked away a winner: Wahl saved the federal government $2 million, the incumbent contractors were awarded the contract, and the rest of industry is well-prepared for the recompete in 2016.

Wahl credited his team for the result.

“As I worked with and through my limited staff of contract specialists finalizing our incumbent pricing arrangements, our result-driven teams, made up of multiple talented subject matter experts, allowed us to succeed in the end,” he said. “We couldn’t have expected a better outcome.”

“This was an incredible job,” Hansen said. “We got to see the value of honest and open conversation between government and industry, and Better Buying Power put into motion. Wahl, our contracting lead, our program office, project officers and personnel down in Albany who are trying to do the right thing for the government worked long and hard to see this through, and they did a tremendous job.”

John Wahl, lead contracting officer for Global Combat Support System-Marine Corps, led a team effort that reduced the price of two GCSS-MC contracts by $2 million using Better Buying Power guidelines. GCSS-MC is the primary technology provider for the Marine Corps Logistics Modernization strategy. U.S. Marine Corps photo by Carden Hedelt.
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