OMB shifts contract emphasis from past to present performance

In an effort to improve federal contract management, the Office of Management and Budget later this month will issue guidelines urging federal agencies to offer contractors continuous feedback.

While many federal contracts already have built-in performance evaluations throughout the life of agreements, OMB's new guidelines on evaluating contractors' performance will emphasize the importance of checking in with contractors at key milestones. The guidelines will be issued by the end of the month, said Deidre Lee, the outgoing administrator of the Office of Federal Procurement Policy.

In recent years, federal procurement officials have emphasized the importance of checking on contractors' past performance. Virtually all contracts include evaluations once the contracts are completed, but officials would like to see more frequent, ongoing interaction between agencies and contractors.

Contracting experts say candid communication throughout the life cycle of a contract creates an environment where both sides can ask questions, share views, and most importantly, clear up misconceptions and conflicting expectations on a case-by case basis-enhancing the quality of the finished product as well as heading off costly-and preventable-mistakes.

Eben Townes, a senior vice president at Chantilly, Va.-based Acquisition Solutions Inc., said a greater focus on present performance-rather than an overemphasis on evaluating past performance-is more conducive to the notion of forming partnerships between government and industry. More frequent and more open dialogue between participating parties helps both sides meet contract goals, he said. He noted that expectations between agencies and contractors can differ, and most contractors would like to know immediately, rather than after the contract term has ended, whether they are doing an A-plus job.

Bert M. Concklin, president of the Professional Services Council, praised the trend toward present peformance evaluation, noting that encouraging-not requiring-agencies to participate in these practices is the way to go. "It's a good idea to stress it [present performance] for source selection and for day-to-day management of the contractor relationship, but regulatory rules would further complicate things. I believe Dee Lee is of a similar temperament and more inclined to give people the tools they need through policy guidance rather than to write laws."

OMB is not planning any regulatory changes, federal officials said.

When asked to cite any possible drawbacks to emphasizing present performance, Les Davison, acting deputy associate administrator in the Office of Acquisition Policy at the General Services Administration, said, "It is one of those motherhood and apple pie things: you can't say anything bad about it."