The Army’s Simulation Training and Instrumentation Command
(STRICOM), headquartered in Orlando, Fla., is initiating the first
in a series of so-called omnibus contracts, designed to shorten
the time between proposals and contract awards. Instead of the usual
nine to 18 months, officials said, the contracting process would
be whittled down to about three months.
The new arrangements are referred to as STOCs, or STRICOM omnibus
contracts. They will become the command’s “acquisition
vehicle of choice,” said STRICOM’s civilian deputy commander,
James Skurka, in a recent interview.
Another popular contracting technique today is called Indefinite
Delivery/Indefinite Quantity (ID/IQ), which often is confused with
omnibus contracts, according to Kim Denver, contracting officer
for advanced distributed systems at STRICOM.
Probably 75 percent of business managers still don’t understand
the difference between ID/IQs and omnibus contracts, he estimated.
The differences are many, he said.
For example, Denver explained, an ID/IQ would cover particular
parts for a vehicle, such as tires. A spending cap would hold spending
on the tires to a specified dollar amount, obligating an agency
to buy a certain number of tires over a period of time, such as
five years. As orders for tires came in from customers, the contractor
would fill orders until the ceiling amount was exhausted. The only
guarantee for the contractor would be the dollar amount stipulated
by the spending limit. In other words, when the tires would be bought
and how many would be bought at a time, and who would buy them,
remains an unknown factor with ID/IQ contracts, Denver explained.
Omnibus contracts, on the other hand, would cover the entire vehicle,
not one piece at a time, he said.
Neither are STOCs to be confused with umbrella contracts, which
cover several product lines at one time, Skurka said. Instead, the
omnibus contracts are divided into four “domains,” or
acquisition areas, Skurka explained. The domains are live, constructive,
virtual, and test and instrumentation.
“[In this way,] STOCs can address particular areas like flight
or mechanical training,” Skurka said. “Omnibus is adaptable
and adjustable. Everything from [leveraging] to developing a technology
base to production will fit.”
STOCs are particularly good for small business participation, because
of the speed with which they are awarded,” noted Skurka.
In addition, savings are realized because the bid and proposal
(B&P) process is accomplished only once, Denver offered. With
omnibus contracts there would not be separate B&P for component
parts contracts for simulator trainers.
Increasing small business participation in STRICOM’s work
has been encouraged in recent years, Jim McBrayer, chief information
officer for STRICOM omnibus contracts told an industry briefing
in Orlando, sponsored by the National Training Systems Association
(NTSA).
There is a mandated goal that requires that 11 percent of STRICOM’S
work be set aside for small businesses, Denver said. In addition,
20 percent of task orders which are not set-asides—and are
awarded to large contractors—must be handed off to subcontractors
for the purpose of cultivating a broader contractor base for STRICOM,
he noted.
Speeding Up Service
STOCs also should speed up service to STRICOM customers, McBrayer
explained. In the past, slow response and delivery has cost STRICOM
business, he said.
STRICOM intends to provide customers with faster access to simulator
training devices, instrumentation systems and accompanying support
services, McBrayer said.
The omnibus contract allows defense contractors to deal with the
military services in the same way that business is conducted in
the private sector, McBrayer explained. These contracts will last
from eight to 10 years, and use a single prime contractor who initially
gave STRICOM the best deal.
“The problem is this,” McBrayer said. “We are
taking too long to acquire. The idea is to become smarter and not
make things harder than they already are.”
The goal is to get a project under award and have it delivered
to the customer in a timely manner, he re-emphasized.
In 1999, STRICOM awarded $789 million in contracts, McBrayer said.
In 2000, he predicted, that figure will grow to nearly $1 billion.
Of that amount, STRICOM wants $480 million—nearly half—to
be omnibus or ID/IQ contracts. This goal would only affect new work
coming through the door, McBrayer noted. “Contracts that are
already in place will not be omnibused,” he said.
For new business, omnibus contracts will become STRICOM’s
preferred vehicle for doing business, officials said. In the future,
STRICOM commanders will, in fact, have to approve any conventional-type
contract arrangements before they can be implemented.
The need to expedite the Army’s procurement cycle has been
a major impetus for STRICOM to seek quicker solutions for reviewing
proposals and making awards, Skurka explained.
It is imperative that STRICOM adapts to the pace with which information
technology (IT) is changing, he emphasized. Old lead times would
cause needed innovations in computer and IT applications to be obsolete
by the time they would come on line.
“Our performance is being driven by the gaming industry,”
Skurka said. “In the private sector, the half life for new
technology is one year. We can’t afford to take a lot of time
to award contracts because of how fast technology is changing.”
In the near future, industry alliances—temporary partnerships
between companies—will become more important for doing business
with STRICOM, said Col. Craig Hanford, director of training device
development at the command. “You may want to look for partners
to help you,” he said. “However, if you’re waiting
for me to show you the R&D, you are already too late...
“There will be no free rides,” Hanford told an industry
conference. “If you mess up, it will be documented. If you
are successful, it will be documented. It’s a shallow trough.
I can’t go back to the well. You lie to me [about development
and delivery], and you’re toast!”
Teaming—while it maybe strongly encouraged—will not
become a requirement for winning contracts at STRICOM, Skurka noted.
Things such as past performance and quality of subcontractors, however,
will be major determining factors when deciding on awards, he said.
Still, Skurka said, the door remains open to new contractors with
little or no experience in dealing with the government. In such
cases, he explained, experience in the commercial arena would be
evaluated.
STRICOM is confident that omnibus contracts will attract the right
kind of players,” experienced or not, McBrayer said.
ID/IQ Contracts
ID/IQ contracts caught on and actually paved the way for STOCs,
Denver said.
STRICOM first experimented with this kind of contract in 1993,
according to Skurka. That year, the command awarded a contract for
Advanced Distributed Simulation Technology I (ADST-I), which turned
out to be a precursor for where Army simulation training was headed,
said Skurka. “ADST-I and -II, is what sold the Navy and the
Air Force on ID/IQ,” he said. “The Navy and the Air
Force know a good idea when they see one.”
“STRICOM was a trailblazer for ID/IQ contracts,” said
Denver. “Ten years ago ID/IQs were being used primarily for
supplies. ADST-I and II actually began procuring services with ID/IQs.”
Once again, STRICOM is taking the acquisition reform lead by introducing
STOCs. Awards for this first series of omnibus contracts will be
announced in September, Skurka said.
Omnibus contracts and ID/IQs are creating great opportunities outside
of the Army for STRICOM, Skurka continued. For example, STRICOM
is handling an increased amount of training devices and support
work for the Special Operations Command (SOCOM), at MacDill Air
Force Base, in Florida.
“We are already extremely joint in nature,” Skurka
cited. “By reducing lead times we also encourage joint endeavors
by saving on initial costs. The old way is more expensive for both
[STRICOM and its partners]. Also, STOCs are an open process from
the beginning.”
Before moving to omnibus contracts, STRICOM first sought industry’s
response. To date, STRICOM has received hundreds of comments, which
“we have taken into account,” while making the move
to faster awards, McBrayer explained.
“We are accommodating and acting on industry concerns about
what it says it needs from Omnibus contracts,” added Skurka,
“These reforms were not undertaken in a void.”
One cost and time saving decision that STRICOM made is to reduce
the customizing of learning systems for each customer, Skurka indicated.
This should enhance training interoperability between the services,
he said.
Contractors are eyeing the new system warily. Stanley M. Aronberg,
president of Aronberg and Associates, a marketing consulting firm
based in Orlando, said he liked the simpler approach to the STOCs.
“If you’re a winner, it’s good,” he commented.
“However, if you lose,” he noted, “you’re
out of it for the next eight years,” the minimum length of
the omnibus contracts.
“The only alternative left open to a loser, he added, “would
be to get back in as a subcontractor.”
From what Aronberg has seen of the new contracts, he believes that
“the bidding process will be expedited and take a shorter
period of time,” he said.
“I have seen contracts turned in 30 days,” he continued.
“That includes 10 to 15 days to respond to a task order, and
another 10 to 15 days to award the contract.”
STOCs could be used for larger projects, Aronberg said, but he
noted: “The more complex the project, the longer it takes
to do the review.”
Omnibus contracts may increase small business participation, but
once a company gets the contract, it has to get the job done, Aronberg
said. He warned against overselling capabilities just to secure
a contract.
“If you don’t or can’t perform the task, then
you’re gone,” he said, “and they will soon forget
who you are.”
Aronberg said that he didn’t believe that STRICOM is tacitly
requiring the practice of teaming. “Everyone uses sub[contractor]s
anyway,” he said. “If you’re not a prime [contractor],
you don’t have control over the contract in the first place.
It is up to the primes to see that work flows down to the partners.”
The Central Florida Chapter of the National Defense Industrial
Association plans to collect data on how well the STOCs perform,
said Aronberg, who is the current chapter president.
“We will collect contractors’ thoughts and comments,
both pro and con, for an after-action report,” he said. There
are 73 companies currently doing business with STRICOM, he noted.
Aronberg predicted that the new contracts will make life easier
for Army trainers. “I have been out there training,”
he said, “and it’s frustrating to not have enough equipment
or the right stuff to properly do your job.”