Read an Excerpt
Managing Federal Government Contracts
The Answer Book
By Charles D. Solloway Jr. Management Concepts Press
Copyright © 2013 Management Concepts, Inc.
All rights reserved.
ISBN: 978-1-56726-397-8
CHAPTER 1
BASIC INFORMATION FOR CONTRACT MANAGERS
This chapter is devoted to questions and answers that involve the basics of contract management, and it defines the key players involved in the contract management process. This information is essential for those new to the field and can serve as a reminder for the rest of us.
1 What is known as the vision for the federal acquisition system?
Part 1 of the Federal Acquisition Regulation (FAR) describes this vision for the acquisition system:
• Participants in the process should work together as a team and be empowered to make decisions within their areas of responsibility. They should keep in mind that the system exists to serve the customer.
• The acquisition team includes representatives of the technical, supply, and procurement communities; the customers they serve; and the contractors that provide supplies and services.
It is important to keep the team approach in mind when involved in contract management or any other aspect of federal government acquisition.
2 What is contract management and how does it differ from contract administration?
Once a contract is awarded, it is monitored by both government and contractor personnel to determine compliance with the terms and conditions of the contract and to identify any remedial or other actions that should be taken. These contract management actions might include increases or decreases in cost or price, changes in terms and conditions, the execution of contract provisions that allow the ordering of additional supplies or services, and even termination of the contract. They might also include any steps needed to close out the contract once the contract requirements have been satisfied.
For the most part, contract administration and contract management are used as synonyms. Among some professionals, however, contract administration is viewed as simply monitoring performance and reacting when noncompliance occurs. Those professionals might view contract management as a proactive process whereby potential problems are identified early and management actions are taken to avoid or minimize contract noncompliance.
3 Who is involved in contract management?
From the government side, the contracting officer is definitely a key player, because only a duly constituted and appropriately assigned contracting officer has the authority to obligate the government in contractual matters.
Other government personnel involved in contract management can include the project or program managers who have overall responsibility for the contract requirement being procured, contract specialists, legal counsel, contracting officer's representatives (CORs), contracting officer technical representatives (COTRs), quality assurance representatives (QARs), property administrators, small business advisors, and any of a host of other government functional specialists. All of these persons may advise and make recommendations to the contracting officer in matters involving contract performance.
From the contractor side, those involved in contract management include anyone who might be given real or implied authority for this purpose by the business owner(s) or corporation executives.
4 Is the contractor solely responsible for contract compliance?
No. The courts have consistently held that the government has a duty to cooperate in the fulfillment of the contract. This does not mean that the government cannot insist upon scrupulous compliance with the contract. But it does mean that the government must comply with any promises that it makes in the contract, such as the timely furnishing of government property, the sharing of needed information, and the timely inspection or review of contractor submissions.
The government is required to perform contract management functions without unduly impeding the contractor. For example, the courts have held the government monetarily liable for inspections that were too stringent and for unwarranted nitpicking during the course of the contract. What is "too stringent" or "nitpicking" is often in the eye of the beholder, but certainly nothing is gained by either party when it occurs — and it can ultimately cost time and money for everyone involved.
5 Is there only one contracting officer for a contract?
There may be one or more than one. The contracting officer who awarded the contract, sometimes known as the principal contracting officer or procuring contracting officer (PCO), may delegate some or all of his or her contract management responsibilities to an administrative contracting officer (ACO). For example, a PCO could delegate all other contract monitoring functions to an ACO while retaining the sole right to issue contract changes. If a contract is terminated, the authority to reach a termination settlement may be delegated to a termination contracting officer (TCO), a contracting professional who specializes in that arena.
In the majority of cases, however, there is only one contracting officer — the PCO who performs both procuring and administrative functions.
6 What happens if the contracting officer retires or is otherwise no longer available?
The agency involved appoints a successor contracting officer.
7 Are contract administration offices established for providing contract management services to procuring contracting officers?
Yes. The Federal Directory of Contract Administrative Services Components identifies elements that are assigned contract administrative responsibilities for specific geographic areas and contractor plants. This directory is maintained by the Defense Contract Management Agency (DCMA) and can be accessed through www.dcma.mil. The components listed are most often called contract administration offices, and they may be used by any agency pursuant to an inter-agency agreement.
8 May an administrative contracting officer who has been delegated responsibility by a procuring contracting officer further assign administrative functions to a contract administration office?
Yes. FAR Part 42 permits this.
9 How does the contracting officer function as a team member in contract management?
The federal courts and federal regulations have always placed great emphasis on the independence of the contracting officer. Although contracting officers have a responsibility to seek out expert opinion, the decisions that they make must be their own. It is in seeking out expert opinion, making prudent business decisions, and working toward customer goals that the contracting officer functions within the team environment envisioned in the FAR.
While working within the team, the contracting officer is nonetheless held accountable for the following:
• Following laws and regulations
• Safeguarding government interests
• Treating contractors fairly.
10 Where can one go for additional guidance on contract management?
Government contracting is a complex and often changing business arena. To better understand and remain abreast of contract management requirements, government acquisition professionals and their private-sector counterparts normally rely on the following:
• The FAR
• Agency supplements to the FAR
• Agency manuals and guides on contract management
• The advice and counsel of agency or company personnel known to be expert in contract management matters
• Training courses offered by the government and private providers, such as the Defense Acquisition University, the VA University, Management Concepts Incorporated, and others
• Decisions of the boards of contract appeals or the federal courts regarding contractor claims (These decisions serve as precedent for the contracting officer and other acquisition team members when making future decisions involving comparable circumstances. A number of commercial publications that summarize and discuss many of these decisions are available.)
• Private publications such as this book and newsletters like the Federal Acquisition Report (published by Management Concepts Press).
11 Are there contractor equivalents of the contracting officer and the government project officer?
There is frequently a contractor employee who is given these types of responsibilities. This person may be called a contract manager, a project manager, a business manager, or by some other title. Generally, the responsibilities of such a person include the following:
• Serving as the primary point of contact with the government and as the middleman between contractor employees and the government
• Keeping records pertaining to the contract, including correspondence with the government and records of meetings with the customer
• Troubleshooting when contract issues arise
• Overseeing contractor compliance with the terms and conditions of the contract and associated factors such as Department of Labor and Environmental Protection Agency requirements
• Requesting contract changes, as appropriate, and negotiating any equitable adjustments made necessary by government-approved or government-initiated changes
• Any other assigned contract responsibilities.
Just as the contracting officer must consider both the interests of the government and the fair treatment of the contractor, the contractor's contract manager must consider both the interests of the government and the interests of his or her employer.
12 What is the role of the project office or program office in contract management?
Contracts are normally entered into in support of a specific project or program or functional area. (For example, a contract might be for a new weapons system, a study of infectious diseases, or support of an agency's information technology operations.) The project or program office acts as the sponsoring activity for the particular contract effort and is largely responsible for the much of the content of the government solicitation and resulting contract. Associated tasks would include developing statements of work, assisting in market research and the subsequent formulation of an acquisition strategy, establishing contract performance standards, and myriad other essential acquisition-related tasks. In most cases, the project or program office nominates the COR or COTR.
During the contract management phase, the project or program manager must work closely with the contracting officer and advise the contracting officer of the impact on the project or program involved when contract issues arise. The program manager also normally controls the purse strings and is the source of funds needed for contract management matters, including funding overruns on cost reimbursement contracts or paying the cost of any changes made to the contract.
The agency contracting officer (along with the user when the end user is an entity other than the program or project office) considers the program or project office "the customer." Often it is a challenging task for the contracting officer to "please the customer" while still complying with laws, regulations, and policies.
13 What is the difference between a contracting officer's representative and a contracting officer's technical representative?
Usually they are synonyms. The FAR permits a contracting officer to appoint technical representatives for specific contracts. For many years, the FAR provided no particular title for these appointed persons. In recent years, in long-overdue recognition of the importance of the COR in contract management, the FAR has provided for appointment of a "COR."
14 What is the FAR guidance with respect to the contracting officer's representative?
The FAR
• Permits the contracting officer to retain duties normally given to a COR
• If COR duties are not retained, requires the contracting officer to appoint, in writing, a COR on all contracts and orders that are not firm-fixed price
• Permits the contracting officer to appoint a COR on fixed-price contracts, as appropriate
• Requires that the COR be a government employee
• Provides that the COR must obtain and maintain required COR certification
• Requires that the COR assist in the administration of the contract
• Requires that the COR have training and experience commensurate with his or her responsibilities
• Requires that the COR not be delegated responsibilities that have been delegated to a contract administration officer
• Requires that the COR maintain a file for each assigned contract that includes, as a minimum
– A copy of the contracting officer's letter of designation and other documents describing the COR's duties and responsibilities
– A copy of the contract administration functions delegated to a contract administration office that may not be delegated to the COR
– Documentation of COR actions taken in accordance with the delegation of authority.
15 Should the contracting officer's representative file contain more than the FAR-required minimum?
Absolutely. The Office of Federal Procurement Policy, in a best practices guide, suggests that the COR maintain a file that includes all correspondence, inspections, memos, trip reports, records of conversations with contractor personnel, and invoices. The file should also include a copy of the contract, any modifications to the contract, and the COR appointment letter.
Some CORs maintain a daily diary of events — a good idea for both the individual and the contracting parties, since it might prove to be valuable later when the contracting parties are trying to accurately reconstruct events.
16 What is the normal agency process for appointing the contracting officer's representative?
Standard practice is to appoint a single technical expert who is given the primary responsibility for day-to-day monitoring of the contract. CORs are appointed by a letter from the contracting officer that clearly delineates their contract responsibilities and the limitations on their authority. Many agencies furnish a copy of this letter to the contractor involved. Exhibit 1-1 is a sample of such a letter. It is also normal practice to furnish a copy of the letter to the functional supervisor of the COR, and some agencies require that the supervisor sign off on the letter to indicate concurrence in the assignment of this additional responsibility.
Usually the COR or COTR is chosen because of his or her technical expertise and is nominated by the project or program office. Although the titles COR or COTR have through practice become the norm for identifying this key individual, some agencies have used other titles such as government technical representative. Although relatively rare, some agencies have had both CORs and COTRs, one of whom might be subordinate to the other. Again in relatively rare cases, some contracting offices have CORs who are not technical experts but instead are employees of the government contracting office.
Because the FAR now specifically uses the title contracting officer's representative (COR), a relatively recent occurrence, it is likely that other titles will disappear over time. In addition to appointing a COR, it is normal practice for the contracting officer to appoint an alternate who is authorized to act only in the absence of the COR.
17 What are the contract management duties of the contracting officer's representative?
Usually a contract, or a task order of sufficient duration and complexity, has a COR to act as "the eyes and ears" of the contracting officer.
The specific duties of the COR are set forth in the appointment letter from the contracting officer and can include a wide variety of oversight and record-keeping duties. In some cases, the COR may be authorized to give "technical direction" to the contractor, although he or she is not allowed to change the contract.
It is important for the COR to realize that he or she is usually the face of the government to contractor employees, and contractor employees might erroneously assume that the COR has the full authority of the government. Accordingly, CORs must be sensitive to this perception and judicious in what they say or do in order to avoid inadvertently exceeding their authority.
While technically a COR is not appointed until there is a contract, it is normal practice to involve the presumptive COR at the early stages of acquisition planning.
(Continues...)
Excerpted from Managing Federal Government Contracts by Charles D. Solloway Jr.. Copyright © 2013 Management Concepts, Inc.. Excerpted by permission of Management Concepts Press.
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