MiDAESS-OCI Feb Industry Day_09-MDA-4316.pdf

Organizational Conflicts of Interest (OCIs)

Missile Defense Agency

February 18th, 2009

DISTRIBUTION STATEMENT A:

Approved for public release;

Distribution is unlimited.

Approved for Public Release

09-MDA-4316 (18 FEB 09)

OCI Status

• Actions taken:

- Nov 24, 08: Draft OCI policy published in FedBizOps

- Dec 18, 08: OCI policy briefed at MiDAESS Industry Day in Huntsville; one-on-one OCI meetings invited

- One-on-one OCI meetings to clarify/discuss OCI policy are continuing

– Over 70 companies requested meetings

– MiDAESS OCI team has met with over 50 companies

- February 6, 09: Draft RFP with Section H OCI clause and OCI policy (annex) published in FedBizOps

OCI Status

• Remaining/continuing actions:

- Complete all contractor requested one-on-one meetings.

- Review and respond to requests for clarifications and questions based upon industry feedback from draft RFP and industry day.

- Issue final RFP

Purposes of OCIs

• Per FAR Parts 2 and 9.5: OCIs can occur when a contractor may be unable to provide impartial advice or assistance, its objectivity in performing a contract is impaired, or it may obtain an unfair competitive advantage.

• GAO has addressed OCIs in the following situations:

- Informational advantages obtained through access to nonpublic information (e.g., acquisition strategy and proprietary information)

- “Biased ground rules”: In performance of another contract, the contractor was in a position to favor its own products and services (e.g., drafting SOWs).

- “Impaired objectivity”: The contractor evaluates its own products and services, those of its competitors, or business partners.

Impaired Objectivity OCI

•This is the primary OCI issue for most MiDAESS competitions.

•Why: Because our advisory and assistance contractors assist us in providing oversight over our major developmental contractors and their subs.

•An “impaired objectivity” OCI issue arises when a contractor is placed in the position of evaluating its own services/products (or those of another corporate division), or those of its prime or of its competitors.

• In the past: Companies attempted to mitigate “impaired objectivity” through firewalls, separate corporate divisions/reporting chains.

•Reality: Per GAO, “impaired objectivity” OCIs cannot be mitigated by firewalls or separate corporate divisions.

•Result: Primes and even subs (in many instances) executing the agency’s major developmental programs will be unable to participate in MiDAESS procurements in the quality, acquisition support, and engineering support functional areas.

- Possible exception: Subcontracting opportunities (should be raised in one-on-one discussions with MiDAESS OCI team)

•MDA will not favorably consider biased-type and impaired objectivity OCIs in most instances.

- Waivers will not be granted; or if granted, only sparingly and in our best interest

•Preferred Approach: Contractors and subcontractors decide which type of work to perform either:

- Support major developmental programs; or

- Provide advisory and assistance services to the agency

•Quality Functional Area:

- No MiDAESS awards will be made in the quality functional area to contractors and subcontractors which are executing the agency’s major developmental programs.

– Unlikely a mitigation plan could resolve all

OCIs.

- Quality prime contractor/subcontractor is not precluded from competing in other MiDAESS functional areas.

•Acquisition support and engineering support functional areas:

- No MiDAESS prime contract awards will be made to the prime contractors executing the agency’s major developmental programs.

- Mitigation of impaired objectivity is virtually impossible. Mitigation plan probably cannot resolve all OCIs.

•Other MiDAESS functional areas:

- Subject to FAR Part 9.5 and GAO analysis

- Dependent on the extent to which the primes and subs evaluate their performance in other MDA developmental and MiDAESS contracts.

MiDAESS OCI Engagement Practices

•Contractors are urged to submit requests for clarification and questions regarding the OCI clause and the OCI policy.

•Contractors are invited to meet with the MiDAESS OCI team to discuss OCI concerns.

•Contractors with no OCI issues can get a written advisory assessment from MDA by submitting an OCI Disclosure Form.

BACKUP

Protecting Nonpublic Information

• Contractors with access to nonpublic (e.g., acquisition sensitive and proprietary) information must be firewalled.

• Employees must be trained and sign nondisclosure agreements

• Contractor employees will be identified at all times.

• Offsite storage of nonpublic information must be approved in advance.

• Nonpublic information must be returned/destroyed at contract termination.

Bias-type OCIs

• Triggered by a contractor’s ability to favor its products and services

- A) Through preparation of specifications or material leading to an SOW. Exceptions:

— Contractor develops the product

— More than one contractor prepares the SOW

- B) When the contractor provides system engineering or technical direction of a system but has no overall responsibility for its development or integration

– These activities can include directing other contractors or resolving technical controversies