CAMMO_Notional_Incentive_Plan_ver_2_0.pdf

FA8823-13-R-0009

ATTACHMENT X: PERFORMANCE INCENTIVE PLAN

Consolidated Air Force Satellite Control Network (AFSCN) 1

Modifications, Maintenance, and Operations (CAMMO) 2

Contract 3

Attachment X: Performance Incentive Plan 4

1 April 2014 5

[This page intentionally left blank] 21

APPROVED BY: 23

____________________________________ Date: __________________ 28 JANET W. GRONDIN, Col, USAF 29 Chief, Spacelift Range and Network Systems Division 30 I do/do not delegate the role of Incentive Approving Official (IAO) to the Incentive Certifying 37 Official (ICO). 38 ____________________________________ Date: __________________ 42

ELLEN M. PAWLIKOWSKI 43

Lieutenant General, USAF 44 Air Force Program Executive Officer for Space 45

[This page intentionally left blank] 60

Revision Change Record 62

Revision Eff. Date Description Initials

Contents 65

1. Introduction ............................................................................................................................................ 7 66

2. Roles and Responsibilities ................................................................................................................... 7 67

3. Quality Performance Index (QPI) ........................................................................................................ 9 68

4. QPI-Based Adjustment Methodology.................................................................................................. 9 69

5. Determination of Share Ratio Payment .............................................................................................. 9 70

6. Changes to the Performance Incentive Plan ................................................................................... 10 71

7. Contract Termination ........................................................................................................................... 10 72

Appendix A: Performance Incentive Metrics ........................................................................................ 12 73

Appendix B: QPI Determination and Sample Calculations ................................................................ 18 74

Appendix C: Calculating the Government Payment and Sample Calculations .............................. 21 75

Appendix D: Historical Record of QPI and Profit ................................................................................. 23 76

1. Introduction 79

The Consolidated Air Force Satellite Control Network (AFSCN) Modifications, 80

Maintenance, and Operations (CAMMO) Performance Incentive Plan outlines the 81 incentive program for the CAMMO Contract. The goal of the CAMMO Performance 82

Incentive Plan is to ensure delivered services result in acceptable levels of 83 performance. This plan provides the policies and procedures used to determine any 84 adjustment to the CAMMO contractor’s profit based on the contractor’s demonstrated 85 performance. 86

The CAMMO contractor’s profit will be determined through the use of a Quality 87

Performance Index (QPI). The overall QPI is split into four quarterly QPIs which 88 facilitate the calculation of quarterly profit payments to the CAMMO contractor. If the 89 contractor fails to meet minimum levels of acceptable performance, as defined in the 90

Performance Incentive Metrics (PIMs) identified in Appendix A, the QPI calculation will 91 result in a loss of profit. 92

Additionally, in conformance with FAR Clause 52.216-16, the over run/under run share 93 will be evaluated on an annual basis for all Fixed-Price Incentive Firm (FPIF) Target 94

CLIN(s). This will incentivize the CAMMO contractor to seek out opportunities for cost 95 savings. 96

The appendices to this document provide descriptions of the performance metrics, how 97 to calculate the QPIs, and example calculations. Appendix A describes the PIMs 98 including their minimum levels of performance, contributions to the QPIs, and how the 99 various QPIs are calculated. Appendix B provides examples of how the quarterly QPIs 100 are determined based on demonstrated performance levels of each PIM. Appendix C 101 provides the calculations and examples for determining the overall government 102 payment. 103

Appendix D contains a historical record of the QPI earned by the CAMMO Contractor 104 over the life of the contract. It will be updated by the PCO annually to reflect the QPIs 105 earned by the contractor over the course of the previous contract year. 106

2. Roles and Responsibilities 107

This section describes the roles and responsibilities associated with the development 108 and execution of this CAMMO Performance Incentive Plan. 109

Incentive Approving Official (IAO) 110

The Air Force Program Executive Officer for Space (AFPEO/SP) will serve as the IAO. 111

The AFPEO/SP may delegate the IAO role to the Incentive Certifying Official (ICO). 112

The IAO approves the CAMMO Performance Incentive Plan and any significant 113 changes to be made to it upon the recommendation of the ICO and Procuring 114

Contracting Officer (PCO). 115

Incentive Certifying Official (ICO) 116

The Spacelift Range and Network Systems Division Chief will serve as the ICO. The 117

ICO reviews the CAMMO Performance Incentive Plan and recommends approval of the 118 performance incentives to the IAO based on compilation of pertinent data regarding the 119 contractor’s performance in meeting performance incentive criteria. 120

CAMMO Program Manager (PM) 121

The CAMMO PM is responsible for evaluating the contractor’s performance. The 122

CAMMO PM presents the results of the government’s evaluation of the CAMMO 123 contractor’s performance to the ICO, based on the findings of the Government 124

Surveillance Team. The CAMMO PM also recommends any significant changes to be 125 made to the CAMMO Performance Incentive Plan to the ICO, including changes to 126 appendices. 127

Procuring Contracting Officer (PCO) 128

The PCO is the formal representative of the Government for the CAMMO contract and 129 acts as a liaison between the government and the contractor. The PCO formally 130 communicates changes to the CAMMO Performance Incentive Plan to the contractor via 131 contract modifications. The PCO also acts as the QPI Determination Official, being 132 responsible for the determination of the quarterly QPIs based on inputs from the 133

Government Surveillance Team. 134

Government Surveillance Team 135

The Government Surveillance Team is comprised of representatives from the AFSCN 136

System Program Office (SPO), the 50th Space Wing (50 SW), and the Contracting 137

Office [to include the Contracting Officer Representatives (CORs)]. This team is 138 responsible for scoring the contractor on the performance metrics used to determine the 139

QPIs. The contractor provides a self-evaluation of their performance on each PIM and 140 submits it to identified members of the Government Surveillance Team for review of 141 validity and accuracy. Scoring of the performance incentive metrics is conducted in 142 accordance with (IAW) the procedures described in Appendix A. The results of the 143 scoring process are submitted to the PCO for evaluation and determination of the 144 quarterly QPI. 145

3. Quality Performance Index (QPI) 146

Based on the observed performance, as compared to the standards listed in Appendix 147

A, the PIMs are assigned a score for the evaluation period. At the end of the contract 148 quarter, the scores earned within the quarter are summed to determine the quarterly 149

QPI. Examples of these calculations are in Appendix B. 150

In the situation where the contractor has met all PIMs for the entire contract year, the 151

QPI would be 100% (25% for each quarter), indicating that the contractor would receive 152

100% of the target profit. If the contractor has failed to meet one or more PIMs, the QPI 153 would be less than 100%. Through this process, the QPI, a quantitative value, is used 154 to summarize the contractor’s performance for the purposes of calculating profit. 155

The PIM table in Appendix A identifies how often they are assessed over the course of 156 the contract quarter and the location of the source of the standard. The PIM score 157 sheets will be filled out by the Government Surveillance Team. These will be used to 158 determine the QPI. 159

4. QPI-Based Adjustment Methodology 160

This section describes the adjustments made to the contractor’s profit through 161 application of the QPI. 162

In concert with the contractor’s submission of data IAW FAR 52.216-16(c), the 163 government will determine the quarterly QPI IAW the procedures described in Section 3 164 of this Performance Incentive Plan. As a result of the determination of the QPI, the 165 contactor’s profit shall be adjusted through the issuance of a modification to the contract 166 by multiplying the target profit by the QPI for that period. 167

As described in Section 3, the QPI serves as a quantitative summary of the contractor’s 168 performance for the purposes of calculating profit. This is used to adjust contractor’s 169 profit to a level commensurate with their demonstrated performance. 170

The equations used to determine the overall government payment, and examples of the 171 calculations, are located in Appendix C. 172

5. Determination of Share Ratio Payment 173

Cost sharing will apply to the CAMMO contract. The cost sharing payment, in either an 174 under run or over run scenario will be determined at the close of the contract year. 175

Once the cost has been determined at the close of the contract year, the government 176 will make a determination on the payment to the contractor based on a 50/50 share 177 ratio. 178

Any under run or over run sharing will be adjusted by a square of the QPI (QPI2). The 179 purpose of this is to incentivize cost savings but not at the expense of reduced 180 performance. The result of using the QPI2 term is that as the QPI diminishes, the cost 181 sharing amount changes at an increasing pace. 182

To be eligible to share in any under run savings, the CAMMO contractor must 183 demonstrate satisfactory performance over the course of the contract year. Satisfactory 184 performance shall be defined by the overall QPI (the sum of the quarterly QPIs) and set 185 to a level greater than or equal to 70%. In the event that the overall QPI drops below 186 this threshold for satisfactory performance, any under run share will not be paid to the 187 contractor. If the overall QPI meets or exceeds the standard for satisfactory 188 performance, the contractor will earn a portion of the under run share, adjusted by QPI2 189 discussed above. In this instance, rounding will not apply. That is, a 69.5% will not be 190 indicative of satisfactory performance. 191

6. Changes to the Performance Incentive Plan 192

This section describes the process for making changes to the CAMMO Performance 193

Incentive Plan. The Performance Incentive Plan will be reviewed annually. It may be 194 changed unilaterally (i.e. without negotiating changes with the contractor) by the PCO to 195 adjust the QPI weight associated with each PIM and/or to update Appendix C following 196 a QPI determination only. All unilateral changes will take effect at the beginning of the 197 next contract year. The contractor will be notified of the unilateral changes by the PCO 198 at least 60 calendar days prior to the next contract year with a formal unilateral 199 modification to follow. All other modifications shall be made bilaterally with the 200 contractor. 201

All significant changes to this plan must be coordinated through the ICO and approved 202 by the IAO. Adjusting the percentage weight associated with each Performance 203

Incentive Metric shall be considered a significant change. Updating the Historical 204

Record of QPI Determination in Appendix D and minor edits to update references shall 205 not be considered a significant change. 206

7. Contract Termination 207

In the event of the termination of this contract for convenience pursuant to FAR 52.249-208

2 or FAR 52.249-9, the performance period during which such termination occurs will 209 end, and the government will evaluate the contractor’s performance for the period of 210 performance as if the period had been completed. 211

Appendix A: Performance Incentive Metrics 212

This Appendix describes the performance incentive metrics and details on their 213 individual scoring. PIMs shall be monitored and reported by the contractor within ten 214 business days of the closure of the respective evaluation period. For all PIMs, the 215 contractor’s self-evaluation of their performance, as reported to the government, will be 216 reviewed by the government for validity and accuracy using secondary, government 217 monitored data. In the event of a dispute, the PCO will review the pertinent data from 218 both the contractor and the Government Surveillance Team and make a unilateral 219 decision with regards to the result. All PIM performance values will be adjudicated at 220 the end of each evaluation period, whether monthly or quarterly, prior to the final 221 determination of the quarterly QPI. 222

If the contractor feels that circumstances outside of their control have led to the inability 223 to meet the standards, they may submit a justification letter to the PCO detailing their 224 claim (to include supporting documentation). This should be done as soon as possible 225 following a specific event that may impact the overall performance, but not to exceed 226 five business days after official notification of the quarterly QPI for the quarter in which 227 the activity occurred. If the government does not respond within ten business days, the 228 contractor may initiate a formal dispute IAW FAR Clause 52.233-1. 229

Table A provides a summary of the PIM standards, scoring, and Performance Work 230

Statement (PWS) paragraph that is the source of the requirement. 231

The PIMs used to determine the QPI are described as follows: 232

PIM-1: Operations Performance Score (PWS 3.1.1.1): This metric evaluates the 233 ability of the contractor to conduct AFSCN operations which result in successful satellite 234 operations. This metric shall be calculated monthly by the CAMMO contractor IAW 235

50SWI 10-220. 236

This PIM utilizes a graduated QPI scoring methodology as noted in Table A. Each 237 individual site must meet the standards for acceptable levels of performance. To 238 measure conformance with this standard, the site with the lowest Operations 239

Performance Score in the network will be used to determine the monthly QPI score for 240

PIM-1, IAW the performance standards listed in Table A. The Operations Performance 241

Score will be rounded to the thousandths decimal position (e.g. 0.99750 would be 242 rounded up to 0.9980 [99.80%]). 243

PIM-2: Operational Availability (Ao) (PWS 3.1.1.1): This metric measures the 244 probability that the AFSCN (as a system) is operable and ready to perform its intended 245 mission at any given time within its operational environment. This metric shall be 246 calculated monthly by the CAMMO contractor IAW the Guidelines for Reliability, 247

Maintainability, and Availability (RMA) Metrics for the Air Force Satellite Control Network 248

(AFSCN) Common User Element (CUE), Volume I, Revision 3, Definitions and Metrics, 249 and Volume II, Data Sources and Procedures (henceforth referred to within this 250 document as the “RMA Guidelines”). 251

Operational Availability is defined as the Mean Time Between Downing Events 252

(MTBDE) divided by the sum of the MTBDE and Mean Down Time (MDT). This metric 253 is measured across the network as a whole. The mean downtime associated with each 254 critical failure will be rounded up to the next quarter hour increment up (e.g. 29 minutes 255 will be rounded to two 15 quarter-hour increments, 32 minutes is rounded to three 256 quarter-hour increments, etc). No rounding will be introduced into the final calculation of 257 this metric. The metric either meets or exceeds the standard or it will be considered a 258 failure. 259

Similar to PIM-1, this PIM also utilizes a graduated scoring methodology. 260

PIM-3: Mean Time to Restore Mission Functionality (MTTRF) (PWS 3.1.1.1): This 261 metric is defined as the average elapsed time, as a result of a critical failure, required to 262 restore a system to full operating status. It is calculated as the total system downtime 263 associated with a critical failure divided by the total number of critical failures. This 264 metric shall be calculated monthly by the CAMMO contractor IAW the RMA Guidelines. 265

The system downtime associated with each critical failure will be rounded up to the next 266 quarter hour increment up (e.g. 29 minutes will be rounded to two 15 quarter-hour 267 increments, 32 minutes is rounded to three quarter-hour increments, etc). No rounding 268 will be introduced into the final calculation of this metric. The metric either meets or 269 exceeds the standard or it will be considered a failure. That is, any value greater than 270

2.0 hours shall be considered as a failure to meet the performance standard. 271

PIM-4: Scheduled versus Actual Downtime (PWS 3.4.2.1): This metric evaluates the 272 contractor’s ability to accurately predict downtime requirements for scheduled 273 maintenance. It is measured as the difference between the scheduled downtime and 274 the actual downtime (to the next quarter-hour increment), as a percentage of the 275 scheduled downtime for each Programmed Depot Maintenance (PDM) visit, determined 276 during the course of the contract quarter. 277

This metric shall be calculated by the CAMMO contractor over the course of the 278 contract quarter. If a PDM visit starts in one quarter and finishes in the next quarter, it 279 shall be counted against the performance for the quarter in which the visit was 280 concluded. All fractional times of a quarter hour increment will be rounded up (e.g. 29 281 minutes will be rounded to two 15 quarter-hour increments, 32 minutes is rounded to 282 three quarter-hour increments, etc). In the event that multiple PDM visits occur over the 283 course of a contract quarter, each visit must independently meet the standard in order 284 to fulfill the requirement. No rounding will be introduced into this metric except for the 285 initial rounding to determine the quarter hour increments. The response time either 286 meets or exceeds the standard or it will be considered a failure. 287

PIM-5: Emergency Depot Level Maintenance (EDLM) Response (PWS 3.4.3.1): 288

This metric evaluates the contractor’s ability to rapidly activate a maintenance team and 289 prepare them and required equipment/parts for deployment. It is measured as the time 290 required for the contractor to identify to the government the specific personnel with the 291 required skill levels, materials, tools, and equipment and specific travel plans following 292 notification by the PCO or designated contracting officer representative (COR) to 293 proceed. 294

This metric shall be calculated by the CAMMO contractor over the course of the 295 contract quarter. If an EDLM response is initiated in one quarter and completed in the 296 next quarter, it shall be counted against the performance for the quarter in which the 297 response was concluded. In the event that multiple EDLMs occur over the course of a 298 contract quarter, the response to each event must meet the standard in order to fulfill 299 the requirement. No rounding will be introduced into this metric. The response time 300 either meets or exceeds the standard or it will be considered a failure. 301

PIM-6: Urgent Depot Level Maintenance (UDLM) Response (PWS 3.4.4.1): This 302 metric evaluates the contractor’s ability to rapidly activate a maintenance team and 303 prepare them and required equipment/parts for deployment. It is measured as the time 304 required for the contractor to identify to the government the specific personnel with the 305 required skill levels, materials, tools, and equipment and specific travel plans following 306 notification by the PCO or designated COR to proceed. 307

This metric shall be calculated by the CAMMO contractor over the course of the 308 contract quarter. If an UDLM response is initiated in one quarter and completed in the 309 next quarter, it shall be counted against the performance for the quarter in which the 310 response was concluded. In the event that multiple UDLMs occur over the course of a 311 contract quarter, the response to each event must meet the standard in order to fulfill 312 the requirement. No rounding will be introduced into this metric. The response time 313 either meets or exceeds the standard or it will be considered a failure. 314

PIM-7: Depot In-house Repairs (PWS 3.4.5.2, 3.4.5.3): This metric evaluates the 315 contractor’s ability to provide timely, in-house depot repair to items requiring repair. It is 316 calculated as the average time from the induction of an item for repair until the shipment 317 of the serviceable item to the Air Force supply system as measured over the course of 318 the contract quarter. This metric shall be calculated by the CAMMO contractor over the 319 course of the contract quarter. If an item is inducted for repair in one quarter and 320 completed in the next quarter, it shall be counted against the performance for the 321 quarter in which the repair was inducted back into the supply system. NOTE: 322

Stocklisted item repair data is not tracked under this metric. 323

For the purposes of this metric, individual repairs will be measured to the whole day by 324 rounding up (e.g. 21.25 days will be rounded up to 22 days). The average of all repair 325 times for the performance period will then be taken and then averaged. No rounding 326 will be required of the average. The repair time either meets or exceeds the standard or 327 it will be considered a failure. 328

Note: The standard in the PWS associated with this PIM is an annual standard. The 329

PWS standard is for depot in-house repairs to be completed within an average of 30 330 calendar days over the course of the entire year. For the purposes of the incentive 331 plan, this has been made a quarterly measure to ensure that the contractor is still 332 incentivized to achieve the standard over the remaining contract year should an 333 exceptionally long item repair occur early in the contract year. Regardless of the 334 measure utilized for PIM-7, the standard shall remain an annual measure and the PCO 335 may issue a CAR to ensure corrective action is being taken to meet the PWS standard. 336

PIM-8: Sub-Vendor Repairs (PWS 3.4.5.2, 3.4.5.3): This metric evaluates the 337 contractor’s ability to manage external vendor relationships and agreements resulting in 338 timely depot repair to items carrying a repair status. It is calculated as the average time 339 from the induction of an item for repair until the shipment of the serviceable item to the 340

Air Force supply system as measured over the course of the contract quarter. This 341 metric shall be calculated by the CAMMO contractor over the course of the contract 342 quarter. If an item is inducted for repair in one quarter and completed in the next 343 quarter, it shall be counted against the performance for the quarter in which the repair 344 was inducted back into the supply system. NOTE: Stocklisted item repair data is not 345 tracked under this metric. 346

For the purposes of this metric, individual repairs will be measured to the whole day by 347 rounding up (e.g. 21.25 days will be rounded up to 22 days). The average of all repair 348 times for the performance period will then be taken and then averaged. No rounding 349 will be required of the average. The repair time either meets or exceeds the standard or 350 it will be considered a failure. 351

Note: The standard in the PWS associated with this PIM is an annual standard. The 352

PWS standard is for depot sub-vendor repairs to be completed within an average of 80 353 calendar days over the course of the entire year. For the purposes of the incentive 354 plan, this has been made a quarterly measure to ensure that the contractor is still 355 incentivized to achieve the standard over the remaining contract year should an 356 exceptionally long item repair occur early in the contract year. Regardless of the 357 measure utilized for PIM-8, the standard shall remain an annual measure and the PCO 358 may issue a CAR to ensure corrective action is being taken to meet the PWS standard. 359

PIM-9: Corrective Action Request (CAR) Response Time (PWS 3.6.3.4): This metric 360 evaluates the contractor’s ability to provide an acceptable cause and corrective action to 361 the PCO on, or prior to, the due date for a CAR. This metric is measured on a pass/fail 362 basis of whether the CAMMO contractor responded to the CAR with an acceptable (as 363 determined by the PCO) corrective action on, or prior to, the due date for a CAR. This 364 metric shall be calculated by the CAMMO contractor over the course of the contract 365 quarter. If a CAR is initiated in one quarter and responded to in the next quarter, it shall 366 be counted against the performance for the quarter in which the accepted response was 367 submitted to the PCO. The response time for all CARS shall either meet or exceed the 368 standard or it will be considered a failure. 369

PIM-10: Software Delivery Deficiencies (PWS 3.7.2.3, 3.7.2.4, 3.7.2.5): This metric 370 evaluates the contractor’s ability to deliver software releases (including Sub-System 371

Software Version Releases, Software Maintenance Actions [SWMAs], and Inter-Range 372

Operation Number [IRON] Databases) with no Category One (CAT-I) Deficiency 373

Reports (DRs) over the course of the contract quarter. DRs measured under this metric 374 are those discovered during field evaluation and within 30 calendar days following 375 operational acceptance. The quarter that the discrepancy is found in will be the quarter 376 that it is applied against. This metric shall be calculated by the CAMMO contractor over 377 the course of the contract quarter. 378

Note: The standard in the PWS associated with this PIM is an annual standard. The 379

PWS standard is for software releases to be delivered with zero CAT-I DRs over the 380 course of the entire year. For the purposes of the incentive plan, this has been made a 381 quarterly measure to ensure that the contractor is still incentivized to achieve the 382 standard over the remaining contract year should a CAT-I DR be discovered early in the 383 year. Regardless of the measure utilized for PIM-10, the standard shall remain an 384 annual measure and the PCO may issue a CAR to ensure corrective action is being 385 taken to meet the PWS standard. 386

Table A-1: Summary of Performance Incentive Metrics 387

PIM

No.

Description % of Overall

QPI

QPI Score per

Evaluation Period

Performance Standard

Monthly Performance Incentive Metrics

Ops Performance Score

Source: PWS 3.1.1.1 24%

2% ≥ 0.998 1% ≥ 0.996 0% < 0.996

AFSCN AO

Source: PWS 3.1.1.1 12%

1% ≥ 89.0% 0.5% ≥ 87.0% 0% < 87.0%

MTTRF

Source: PWS 3.1.1.1 12%

1% ≤ 2.0 hrs 0% > 2.0 hrs

Quarterly Performance Incentive Metrics

Scheduled vs Actual

Downtime Source: PWS 3.4.2.1

8% 2% within +/- 3%

0% outside +/- 3%

EDLM Response

Source: PWS 3.4.3.1 4%

1% ≤ 24 hrs 0% > 24 hrs

UDLM Response

Source: PWS 3.4.4.1 4%

1% ≤ 72 hrs 0% > 72 hrs

Depot In-House Repairs

Source: PWS 3.4.5.2, 3.4.5.3

4% 1% ≤ 30 cal. days

0% > 30 cal. days

Sub-Vendor Repairs Source: PWS 3.4.5.2,

3.4.5.3 4%

1% ≤ 80 cal. days

0% > 80 cal. days

CAR Response Time Source: PWS 3.6.3.4

16% 4% = 0 Overdue CARs 0% > 0 Overdue CARs

Software Delivery Deficiencies

Source: PWS 3.7.2.3, 3.7.2.4, 3.7.2.5

12% 3%

= 0 CAT-I DRs for all releases

0% > 0 CAT-I DRs for all releases

Appendix B: QPI Determination and Sample Calculations 390

This Appendix provides sample calculations for the determination of the QPI and 391 consequently, the total profit. The values used are purely hypothetical in an effort to 392 demonstrate how the calculations are conducted. 393

Table B-1 demonstrates how the observed level of performance relates to the minimum 394 acceptable levels of performance. Cells shaded in green indicate PIMs that, during the 395 evaluation period, met or exceeded the criteria for acceptable performance 396

(summarized in the “Standard” column). PIM-1, Operations Performance Score, and 397

PIM-2, Operational Availability, are the only metrics that deviates from the pass/fail 398 methodology incorporated into this plan. Since they use a graduated set of standards, 399 any evaluation period where mid-level performance was observed is shaded yellow. 400

For all PIMs, evaluation periods that fail to meet the minimum standards are shaded 401 red. 402

Table B-2 demonstrates how the demonstrated levels of performance relate to an 403 earned score and consequently, the QPI. Thus a cell shaded red (failed to meet 404 criteria) in Table B-1 will have a score of zero in Table B-2. Cells meeting this criterion 405 in Table B-2 are also shaded red. 406

Table B-2 also demonstrates how the scores are used to calculate the Quarterly QPIs. 407

All scores that fall under the respective quarter are summed to determine the QPI for 408 that quarter. All of the monthly scores under a PIM are added as part of the quarterly 409

QPI. Thus, if a monthly PIM is allocated a possible 2% per month and all three months 410 met the standards for acceptable performance, the total contribution for that PIM to the 411 quarterly QPI would be 6%. 412

Table B-1: Example of Applying Observed PIM Performance Against Standards 413

Measured Performance for each PIM (by evaluation period)

PIM Standard Q1 Q2 Q3 Q4

1 ‐ Ops Performance Score

≥ 0.998

0.997 0.998 0.995 0.998 0.999 0.998 0.998 0.997 0.999 0.999 0.999 0.998

≥ 0.996

2 ‐ Operational Availability

≥ 89.0% 86.0% 89.0% 89.0% 89.0% 90.0% 90.0% 91.0% 90.0% 89.0% 90.0% 90.0% 89.0%

≥ 87.0%

3 ‐ MTTRF ≤ 2.0 hrs 1.8 hrs 1.9 hrs 2.3 hrs 1.3 hrs 0.8 hrs 1.1 hrs 1.8 hrs 0.9 hrs 1.2 hrs 2.4 hrs 1.3 hrs 2.1 hrs

4 ‐ Scheduled vs Actual Downtime ≤ +/‐ 3.0%

‐1.2% 2.1% 1.8% ‐2.2%

5 ‐ EDLM Response ≤ 24 hrs 26 hrs 0 hrs (no EDLMs) 18 hrs 22 hrs

6 ‐ UDLM Response ≤ 72 hrs 74 hrs 63 hrs 54 hrs 68 hrs

7 ‐ Off‐Site In‐House repair

≤ 30 cal.

days

24 cal. days 20 cal. days 32 cal. days 25 cal. days

8 – Sub‐Vendor Repair ≤ 80 cal.

days

92 cal. days 74 cal. days 68 cal. days 47 cal. days

9 ‐ CAR Response Time = 100% 100% 100% 100% 100%

10 ‐ Software Delivery Deficiencies

= 0 CAT‐I

DRs

0 CAT‐I DRs 0 CAT‐I DRs 0 CAT‐I DRs 0 CAT‐I DRs

Table B-2: Example of Score and QPI Calculation Based on PIM Performance 415

Resulting Score (by evaluation period)

PIM Score per Eval. Per. Q1 Q2 Q3 Q4

1 ‐ Ops Performance Score

2% 1% 2% 0% 2% 2% 2% 2% 1% 2% 2% 2% 2%

1%

2 ‐ Operational Availability

1% 0% 1% 1% 1% 1% 1% 1% 1% 1% 1% 1% 1%

0.5%

3 ‐ MTTRF 1% 1% 1% 0% 1% 1% 1% 1% 1% 1% 0% 1% 0%

4 ‐ Scheduled vs Actual Downtime

2% 2% 2% 2% 2%

5 ‐ EDLM Response 1% 0% 1% 1% 1%

6 ‐ UDLM Response 1% 0% 1% 1% 1%

7 ‐ Off‐Site In‐House repair

1% 1% 1% 0% 1%

8 – Sub‐Vendor Repair 1% 0% 1% 1% 1%

9 ‐ CAR Response Time 4% 4% 4% 4% 4%

10 ‐ Software Delivery Deficiencies

3% 3% 3% 3% 3%

Quarterly

QPI:

17.0%1 25.0%1 23.0%1 23.0%1

Overall

QPI:

88.0%1

Note 1: Quarterly and overall QPI values will be calculated to the half-percentage point. No rounding is necessary. 416

Appendix C: Calculating the Government Payment and Sample Calculations 418

A description of the terms used in the equations used to determine the government 419 payment is listed in Table C-1. The overall government payments over the course of 420 the contract year shall not exceed the ceiling price, set at 115% of the target cost. 421

Table C-1: Terms Used in Government Payment Determination Equations 422

Description Equation Term Government Payment, Under Run

Scenario:

GPU

Government Payment, Over Run Scenario:

GPO

Contractor Share Ratio: SRk

Government Share Ratio: SRg

Target Cost Amount: TC

Target Profit Amount: TP Under Run Amount (always negative): UR Over Run Amount (always positive): OR

Quality Performance Index: QPI

The equations used to determine the government’s payment in the event of an under 424 run (Equation 1) or overrun (Equation 2) are listed below. 425

∗ ∗ ∗ (1)

∗ ∗ ∗ (2)

Sample calculations for determining the government payment are demonstrated in 427

Table C-2. 428

Table C-2: Sample Calculations for Determining Government Payment 429

Calculating the Government Payment (under run) Description Term Value (sample)

Target Cost Amount TC $60M Under run Amount UR - $2M

Target Profit Amount TP $6M Quality Performance Index QPI 88%

Contractor Share Ratio (under run) SRk 50%

$60 $2 $6 ∗ 0.88 0.50 ∗ $2 ∗ 0.88

$58 $5.28 $0.774 $ , , 1,2

Calculating the Government Payment (over run) Description Term Value (sample)

Target Cost Amount TC $60M Over run Amount OR $2M

Target Profit Amount TP $6M Quality Performance Index QPI 88%

Government Share Ratio (over run) SRg 50%

$60 $6 ∗ 0.88 0.50 ∗ $2 ∗ 0.88

$60 $5.28 $0.774 $ , , 1,2

Note 1: All dollar amounts will be rounded to the nearest whole dollar. 430 Note 2: In no instance will the government payment exceed the ceiling price, set at 115% of the Target 431 Cost. 432

Appendix D: Historical Record of QPI and Profit (dates are notional) 434

Performance Period Target Profit QPI

Adjusted Profit

Cost Share

Payment

Payment

Year 1 1 Jun 2015 – 31 May 2016

Q1 TBD TBD TBD

Under Run □ Over Run □

TBD

Q2 TBD TBD TBD TBD

Q3 TBD TBD TBD TBD

Q4 TBD TBD TBD TBD TBD

Annual Sum of Q1-4

QPI

Sum

Sum of Payments

Year 2 1 Jun 2016

– 31 May

Q1 TBD TBD TBD

Under Run □ Over Run □

TBD

Q2 TBD TBD TBD TBD

Q3 TBD TBD TBD TBD

Q4 TBD TBD TBD TBD TBD

Annual Sum of Q1-4

QPI

Year 3 1 Jun 2017

– 31 May

Q1 TBD TBD TBD

Under Run □ Over Run □

TBD

Q2 TBD TBD TBD TBD

Q3 TBD TBD TBD TBD

Q4 TBD TBD TBD TBD TBD

Annual Sum of Q1-4

QPI

Year 4 1 Jun 2018

– 31 May

Q1 TBD TBD TBD

Under Run □ Over Run □

TBD

Q2 TBD TBD TBD TBD

Q3 TBD TBD TBD TBD

Q4 TBD TBD TBD TBD TBD

Annual Sum of Q1-4

QPI

Year 5 1 Jun 2019

– 31 May

Q1 TBD TBD TBD

Under Run □ Over Run □

TBD

Q2 TBD TBD TBD TBD

Q3 TBD TBD TBD TBD

Q4 TBD TBD TBD TBD TBD

Annual Sum of Q1-4

QPI

Performance Period Target Profit QPI

Adjusted Profit

Cost Share

Payment

Payment

Year 6 1 Jun 2020

– 31 May

Q1 TBD TBD TBD

Under Run □ Over Run □

TBD

Q2 TBD TBD TBD TBD

Q3 TBD TBD TBD TBD

Q4 TBD TBD TBD TBD TBD

Annual Sum of Q1-4

QPI

Year 7 1 Jun 2021

– 31 May

Q1 TBD TBD TBD

Under Run □ Over Run □

TBD

Q2 TBD TBD TBD TBD

Q3 TBD TBD TBD TBD

Q4 TBD TBD TBD TBD TBD

Annual Sum of Q1-4

QPI