Even though a Small Business leverages every relationship and network for business growth, submitting winning proposals remains the largest factor in growing new business. While TechWise Headquarters is fairly small – we are about 15 full-time folks here – our Proposal Operations are “Big Business”, and just about everyone is asked to roll up their sleeves and pitch in, and they do. Most Small Businesses don’t keep proposal capability in-house; they hire in consultants as needed for proposal work. TechWise has a very strong Proposal Team on staff full-time and this team is engaged in proposal work almost continually year-round.
A good proposal does not start with the drop of a draft request for proposal; it starts with a solid response to a sources sought or request for information the Government posts. Over the course of time, as opportunities are tracked and intelligence is gathered, a solid approach for a proposal response is formed. By the time a draft or final request for proposal is released, the proposal effort should be well under way. Of course, that is the best case scenario. TechWise responds to many opportunities that were not long-term tracked and may just appear on our radar. Being flexible and responsive can yield excellent results.
As small as we are, TechWise has evaluated, considered, or responded to over 80 opportunities in 2011. This includes two full-blown large DoD proposal efforts, Task Orders where we are the Prime, Task Orders we support as Subcontractor, and Overseas opportunities. We designate capture managers to continually gather and brief information and intelligence about opportunities and we establish relationships with Teammates selected to pursue opportunities together. These ongoing efforts lead to the fact that we were able to announce multiple new contracts each quarter last year.
At TechWise, everyone gets recruited onto the Proposal Team when needed, and everyone gladly supports proposal efforts. For the technical content, we recruit our Program Managers and employees in the field to write. Our Management and Quality Programs come with strong documentation that we use in our proposals. We keep a comprehensive past performance library that is continually updated and ready for use in proposals. In these Low Price Technically Acceptable (LPTA) times, price to win is essential. Our strong Pricing Team hit that price to win many times this year! We have strong in-house technical writing and editing capability. We are a well oiled machine that comes together and takes pride in planning, preparing, and producing winning proposals. Yes, we even produce our own proposals!
Proposal work is not for everyone, and definitely not for the faint at heart. It takes stamina, perseverance, late nights, many pizzas, gallons of coffee, and a Team that works well together, likes one another, and has mutual respect for each other. TechWise’s results for 2011 show that a small business, without the proposal operations ‘machine’ of a large company, can still succeed and persevere as long as everyone pulls together in the same direction with the same goal in mind.
Many of the recent Defense contracts for training are awarded based on Lowest Price, Technically Acceptable (LPTA) criteria. LPTA is currently favored as Customers try to buy more with less. The benefit to the Government is that it reduces Government costs while still accomplishing the work. From a corporate perspective, it focuses the industry into innovation and developing operational efficiencies, thereby increasing productivity and value for the Government.
The movie Armageddon has a humorous clip that mentions LPTA prior to the shuttle take-off.
http://www.youtube.com/watch?v=CuAUE58MQt4 It illustrates the risk these types of contracts pose. While the example is clearly applicable for products, the thought process can also be applied to services.
Contractors bidding on service contracts under LPTA criteria have challenging choices to make. Winning low price bids means managing at least one of three key cost areas: 1) Employee Salaries, 2) Indirect Rates (Company efficiency), and 3) innovative staffing solutions (less people). The dilemma for a company that prides itself in delivering quality and exceeding Customer expectations is how low can you drive the three cost areas while maintaining quality? This is a narrow decision point each company needs to decide for itself. If a company uses simple cost cutting, going too far to win the work still puts its execution at risk for a multitude of possible reasons: inability to hire workers, high turnover, poor performance, unhappy workforce, HQ inability to properly perform all needed functions.
From the Government perspective, the risk is driven by how well the technical requirements are defined. Since LPTA award criteria do not give bonus points for going above the requirement, the Customer needs to understand the true requirements and define them very well in the solicitation.
While I cannot speak to active LPTA awarded contracts, TechWise has beaten previous LPTA winners in recompetes because the prior company’s austere cost saving programs caused inefficiencies which led to unhappy Customers, allowing us to win the recompete based on our management and quality approach to Customer needs.
As federal budgets shrink, everyone involved in the process has challenging decisions to make:
- Customers have to make a hard decision whether to stop performing certain functions to adequately fund others, or whether to continue with LPTA criteria.
- Once Customers choose LPTA award criteria, they need to really understand their program and what is important, so that companies can bid just those requirements. Companies bidding MORE than the minimum requirements will likely lose the work in a fair review of proposed prices.
- Companies need to continually focus on innovation and creativity in operations to reduce the cost structure.
I would love to see a Defense Industry comparison of Customer satisfaction with Best Value versus LPTA contracts. Does anyone know of such a study?
