PWS.pdf

WRITING

PERFORMANCE WORK STATEMENTS

SECOND EDITION

February 2013

Foreword

Army reliance on contracts for equipment, supplies, and, especially, services, has significantly increased in recent years. This handbook is designed to aid the requiring activity in developing a performance work statement (PWS) for services. Identifying the requiring activity’s requirements and clearly articulating them in a PWS is critical; nothing is more fundamental to the success of a contract than the PWS.

This handbook is designed to assist in the development of a PWS for a performance based service acquisition. Army Regulation 70-13, Management and Oversight of Service Acquisitions, states that, unless otherwise approved, all acquisitions of services shall be structured as performance-based in order to ensure that required performance quality levels are achieved and that total payment is related to the degree that services are performed or outcomes achieved meet contract standards. The Regulation further states that requirements shall be described in terms of results required rather than the methods of performance of the work. In addition, the procedures for acquiring services using performance-based acquisition methods are set forth in Federal Acquisition Regulation (FAR) 37.6, as well as in the Guidebook for the Acquisition of Services (PGI 237.102-75) provided in Defense Federal Acquisition Regulation Supplement (DFARS) 237.102-75.

Key lessons:

• A PWS defines a requiring activity’s contractor support requirement for supplies, services, or construction. In the case of C4ISR and related organizations, this is usually for services.

• A PWS does not dictate the ways and means of contractor support.

• The benefit of a well-written PWS is that the Government pays for results, not activity.

• The handbook’s nine-step process for writing a PWS greatly increases the probability of maximizing contractor performance.

The PWS is a detailed set of verifiable performance or quality standards for everything the contractor is required to perform or produce. A PWS must be specific because contracting officers and contractors are not mind readers. A properly-developed PWS is concise in defining the performance parameters and quality of product. Ultimately, an effective PWS is the basis for viable contracts that meet or exceed the user’s requirements.

A PWS may be for a stand-alone contract, or for a task order under an Indefinite Quantity- Indefinite Quality (ID/IQ) or similar type of contract. The general principles are the same in both situations, but there are differences that will be pointed out in this handbook and which should be noted when preparing a PWS.

Unless otherwise stated, in this handbook, whenever the masculine or feminine gender is used, both are intended.

i

HANDBOOK-DEVELOPING A PWS

Developing a Performance Work Statement

Table of Contents

Introduction a

Preface

Chapter 1. Introduction to Performance Work Statements and Statements of Work

Chapter 2. Contracting 101

Chapter 3. Nine Steps to Developing a Performance Work Statement

Chapter 4. English 101: Guidelines for Writing a Performance Work Statement

Final Thoughts

Appendix A. Sample Performance Based Task Statements

Appendix B. Performance Requirements Summary Sample Matrix a

Introduction

This second edition (version 2.0) of the performance work statement (PWS) handbook contains a summary of how to develop a PWS. Information from numerous sources within the defense acquisition community and hard lessons from countless requiring activities contributed to this handbook.

The design of the handbook allows you to pick it up and begin reading at any point, much like a reference book, so you may want to start with a topic that interests you. Use the table of contents to identify general areas of interest, find what you need, and tackle a statement of work or PWS-related task with confidence.

This handbook is a guide and is not a substitute for official training. Be aware that if you are working on a task order [such as under the Rapid Response Third Generation (R2-3G) or Strategic Services Sourcing (S3) Contract] rather than a stand-alone contract, there are standard requirements, clauses and rules about how that task order PWS is supposed to be formatted and completed. ACC-APG and the CECOM Legal Office will provide further information.

PREFACE:

WHY IS THE PWS SO IMPORTANT?

Why is writing a strong PWS so important to your contracting efforts? There are several objectives in pre-award contracting efforts.

To acquire the required services as quickly as possible while complying with all policies and regulations.

To obtain high-quality services that meet the Government’s minimum requirements To ensure that contracts can be properly administered to maintain levels of performance that result in the Government’s continuing to receive the best value throughout the period of the contract.

Reducing delays

Protests against the solicitation or the award will significantly delay the delivery of services or supplies, except in rare and special circumstances.

One of the main sources of protest litigation, whether during the source selection process, or upon contract award, is vague or ambiguous language in the Government’s documentation. One of the key elements of a Government contract is the description of the requirement. Litigation (in the form of a protest) causes major delay in getting the services or supplies. Making sure that the documentation fully supports the pre-award and award decisions is imperative, both in reducing risk of litigation, and in improving chances of prevailing in the event there is litigation.

Clearly articulating the Government’s minimum requirements has multiple benefits. When we can clearly express our minimum requirements, we are more likely able to design an evaluation scheme that will focus on the key discriminators that will set the better proposals apart from the others. In order to explain to an awardee, or a disappointed Offeror, how their proposal exceeded, fell below, or just satisfied the Government’s minimum requirements, those basic requirements had to be clearly articulated. Being able to demonstrate unambiguously to a disappointed Offeror where his proposal failed to meet the stated requirements will reduce the Offeror’s protest grounds. Similarly, being able to demonstrate to a decision maker the aspects of a particular proposal that make it stand out above others requires one fundamental:

comparison to a clear statement of the standard against which the proposal was measured.

When an Offeror is deciding whether to protest the language of a solicitation or the agency’s award decision, one of the first steps is having a lawyer (hired by the Offeror) analyze the documentation. If a protest is actually filed, the documentation will be analyzed by lawyers or Judges for GAO or a Court. These lawyers and Judges will look for language that is ambiguous and vague. They will look for inconsistencies and illogical rationale. Those are the characteristics that will indicate flaws in the Government’s actions; those are the things that will raise questions about the fairness of the competition. Those are the things that cause delays in ii procurement actions at the most inopportune times. That is what the Government attorneys are trying to guard against. The attorneys apply the knowledge and experience gained from prior litigation to help reduce the risk of litigation in the first place and to increase the odds of prevailing if there is litigation.

In contrast, documents that demonstrate professional qualities, such as clearly articulated thoughts in logical arrangement that are internally consistent, are the ones that will impress the attorneys contemplating challenging the Government’s decisions. Those are the documents that will withstand the tough scrutiny of the courts and boards and will persuade those courts and boards that the agency conducted its competition fairly. Those are the documents that will speed the procurement process. This is one reason why a well-written PWS is so important.

Obtaining high-quality services that meet Government’s requirements

As mentioned above, clearly articulating the Government’s minimum requirements has multiple benefits. With a clearer understanding of the Government’s minimum requirements, Offerors are better able to develop cost-effective and feasible approaches to performing the work. They are better able to predict the cost or price of performing the work according to the approach they have developed. The more clearly we describe, the more precisely we define our requirements, the higher the probability that we will be able to determine which Offeror will provide the highest quality, best value services.

Contract administration

Another reason to draft a clear and concise PWS arises in contract administration. A clear and concise PWS includes task statements that have measurable outcomes. Clearly articulating tasks and the standards by which performance will be determined acceptable has two advantages: first, both the contractor and the Government will have established a meeting of the minds about the expectations; second, it is easier to determine whether expectations have been met or failed if they are clearly articulated. The Government will be in a favorable position to take remedial action to address failing performance. It is easier to prove that a duty has been breached if the duty was clearly defined.

Summary

By focusing on the end result, and writing a well defined PWS in light of the activity’s mission and performance objectives, we open the door to innovation and greater potential success while reducing the chance of a successful protest.

Chapter 1

Introduction to Performance Work Statements and Statements of Work

Getting statements of work (SOW) or performance work statements (PWS) correct is no easy task; however, nothing is more fundamental to the success of a contract.

The success of a contract is measured during contract performance and administration. An effective contract is one that clearly articulates the exact intentions of the parties. It reflects, within its four corners, the agreements between the parties. To the extent possible it is not ambiguous.

If the PWS is too vague, too broad, or too generic, it can leave room for wild and varied interpretations in a less than ideal business environment. These various interpretations can lead to mission failure and higher cost to the Government. Remember, any performance based contract starts with a PWS, and PWS development is the requiring activity’s responsibility. Who else knows best what they want?

There are two major categories of acquisitions: supplies and services. A service contract directly engages the time and effort of a contractor whose primary purpose is to perform an identifiable task rather than to furnish an end item of supply. In order to communicate what tasks the contractor is required to perform (as in a task order), or what products the contractor is to deliver (as in a delivery order), the requiring activity must develop the PWS or SOW.

The PWS in a performance-based service acquisition is one in which the Government describes its requirements and allows the contractor determine how it will meet them. Under the Statement of Work concept, the Government dictates the processes the contractor will use to perform the work. Under the PWS concept, the contract is based on the contractor’s unique approach to achieving the Government’s desired end result, rather than the contractor following a Government-defined method (the SOW model). For example, below is a SOW for baking a dozen chocolate chip cookies, and a PWS for the same work:

EXAMPLE: SOW for baking one dozen chocolate chip cookies:

Ingredients:

1 cup (c.) butter (or ¾ c. butter and ¼ c. butter-flavored Crisco)

2 ¼ c. all-purpose flour

1 c. dark brown sugar

½ c. granulated sugar

2 large eggs, beaten

2 teaspoons (tsp) real bourbon vanilla extract

12 ounces semi-sweet chocolate chips

1 c. shelled walnuts

1 tsp milk

½ tsp water

1 tsp baking soda

½ tsp salt

Directions:

Preheat your oven to 325° Fahrenheit.

Use an electric mixer to mix sugars and butter in a large bowl. Add the other wet ingredients, mixing well. Then mix in flour, baking soda, and salt.

Finally, mix in chocolate and nuts.

Place tablespoon-sized balls of cookie dough on an ungreased baking sheet and bake for about 11 minutes (cooking times may vary). The cookies will be extremely soft when removed from the oven. Carefully lift the cookies with a spatula and place them on a rack to cool. Ensure there is protection from flies and rodents.

Packaging should provide adequate moisture protection so that the cookies remain fresh and no more than five percent of the delivered cookies experience breakage.

Delivery must be made not later than 7 days after contract award at the lobby of 6002 Combat Drive, APG, MD, 21005. Acceptance will be made by the COR after tasting a random sample.

EXAMPLE: PWS for baking one dozen chocolate chip cookies

What?

Bake one dozen delicious chocolate chip cookies.

When?

One week from today.

Where?

Lobby, 6002 Combat Drive, APG, MD, 21005.

How many?

1 dozen (12 cookies).

How well?

Must taste good, and no more than 5% can be broken.

In developing the PWS, the development team should keep in mind a shared vision of the project and consensus on the end state. The team must be willing to compromise without losing sight of the answers to three key questions:

1. What do I need?

2. When do I need it?

3. How do I know it is acceptable when I receive it?

Using the PWS approach encourages efficiency and innovation on the part of the contractor. At the same time, developing a PWS requires significant research and work for the team developing the requirement. The team must analyze the work requirements (this analysis is described in more detail below) and articulate clearly what tasks are in terms of the results that will meet the Government’s minimum requirements.

Benefits of a PWS over a traditional SOW

The PWS:

• Provides better value. The Government pays for results, not activity.

• Maximizes performance. The contractor and the Government focus on results, not procedure. The contractor delivers the required service or goods but follows its own best practices. Provided that the delivered service (outcome) remains in accordance with the contract, contractors can adjust their processes, as appropriate, throughout the life of the contract without the burden of contract modifications. The use of incentives motivates higher quality performance by the contractor.

• Detailed processes are not required; this allows the contractor flexibility in proposing the best solution, and the option to follow standard industry procedures. In addition, the Government is relieved of the burden to provide detailed processes. However, detailed specifications, performance thresholds and objectives may be required in some cases.

• Promotes the use of commercial services. The ability to use commercial services allows the Government to take advantage of existing industry practices, and reduces the use of Government-unique contract clauses.

• Maximizes competition. Competition is maximized not just in the areas of cost and price, but also when it comes to ideas and innovation. The PWS approach allows for greater innovation and has the potential to attract a broader industry base to a project. Encouraging innovation from the supplier base by using performance requirements maximizes opportunities for competitive alternatives rather than Government-directed solutions.

Other potential benefits include: an increased likelihood of meeting mission needs (and getting the desired quality of the services required); increased focus on intended results, rather than processes; and contractor buy-in and shared interests. Additionally, shared incentives permit innovation and cost effectiveness; and the Government can choose from a variety of solutions.

Chapter 2

Contracting 101

In the world of federal Government contracting, there are multiple types of instruments that are referred to as contracts. And there are a lot of terms used to describe contracts. The basic elements of a contract are: an offer, an acceptance and consideration. Consideration is the payment for the supplies or services. Any type of commitment that obligates the Government to an expenditure of appropriated funds is a contract. Except in rare circumstances, contracts must be in writing.

Contracts contain terms and conditions which govern the actions of both parties. For example, for the party who is performing by providing services, the terms will specify the period of time during which the services are to be rendered, or the time by which a particular service must be completed. For the party who is performing by providing supplies, the terms will state delivery schedules and specifications, at the least.

A simple contract is one in which the Government and another party form a binding arrangement with each other: one party agrees to provide certain goods or to perform certain services within a certain period of time, and the other party agrees to pay for the goods or services. The task or delivery orders issued under basic indefinite delivery/indefinite quantity (ID/IQ) contracts are also individually referred to as contracts.

The regulations governing federal Government contracting are in the Federal Acquisition Regulations (FAR). Departments and agencies have developed their own acquisition guidance which supplements (adds more specificity to, but does not conflict with the FAR) the FAR. The DFARS and the AFARS are the Department of Defense and Department of the Army supplements. A uniform format for Government contracts has been established by the FAR.

Thus, for every contract, essentially the same type of information is found in a uniform section.

The use of the uniform contract format is described in FAR 15.204. Although this is discussed in more detail below, for contract formation and pre-award purposes, there are four sections that are particularly important.

Section B contains brief statements of the services required, and associated periods of performance. This is the place where the Offeror will list its costs or prices for the work it proposes.

Section C contains the statement of work (in our case, this is expressed as a Performance Work Statement).

Section L contains information to bidders and Offerors about what they are to submit in response to the solicitation.

Section M explains to bidders and Offerors how the Government will evaluate the information it has requested from the bidders or Offerors.

In federal Government contracting, contracts can be awarded through competitive and non-competitive procedures. There are statutes mandating the use of competitive procedures except in specific circumstances. The Government’s award of a contract using other than competitive must be expressly justified and approved by officials authorized to make such determinations.

In federal contracting, a solicitation is issued to the public. The solicitation requests proposals, a bid, or a quote. All of these are forms of offers. The Government then selects the best of the offers through competitive processes, ultimately accepting one or more of the offers.

A particularly important concept in federal contracting is that the solicitation, with the exception of Sections L and M (described below) becomes the contract. In other words, at the time of award, Sections L and M are removed, and the document that was the solicitation, now becomes the contract. This is important to understand because it tells you how critical it is to think ahead and articulate clearly in the solicitation the terms and conditions of performance that are your minimum critical requirements. The solicitation must contain everything that the contractor must perform in order for the mission to succeed.

In federal acquisition law, contracts are categorized in various ways. One way is by the cost or pricing arrangement. There are three broad categories of cost and pricing arrangements.

• Fixed Price (FAR Subpart 16.2)

• Cost reimbursement (FAR Subpart 16.3)

• Incentive (FAR Subpart 16.4)

There is also a category called Indefinite-delivery contracts. These are also known as Task order and Delivery order contracts. There are three types of Indefinite-delivery contracts.

• Definite quantity contracts (FAR 16.502)

• Requirements contracts (FAR 16.503)

• Indefinite quantity contracts, also known as Indefinite Delivery/Indefinite Quantity

(ID/IQ) (FAR 16.504)

All three types of indefinite-delivery contracts:

• May use any appropriate cost or pricing arrangement as described in FAR Part 16

• Are used by placing Task or Delivery orders that specify quantities, tasks or delivery schedules in accordance with the basic contract.

Procurement Methods

There are multiple methods by which the Government establishes contracts. There are three major categories of procurement processes.

The first is the large category of Simplified Acquisitions. This includes purchasing through Government purchase cards, blanket purchase agreements and purchase orders. Solicitations are called requests for quotes (RFQ). Guidance for this method of procurement is in FAR Part 13.

The second method of procurement is known as Sealed Bidding. This involves issuing an Invitation for Bids (IFB). Awards are made on the basis of the lowest price from a responsive bidder. The bid must be a firm fixed price. This method is most commonly used in construction contracting. Discussions with the responding sources about their bids are not permitted in sealed bidding. In this method the Contracting Officer has no flexibility in exercising judgment about the best source. Guidance for this method of procurement is in FAR Part 14.

The third method of procurement is known as Negotiated Procurement. Guidance for this method of procurement is in FAR Part 15. This is the most complex of the three methods. In this method, the Contracting Officer negotiates the best price and the best terms and conditions possible. There is wide latitude in the criteria the Government can use to evaluate proposals. In Government contracting parlance, negotiations are also referred to as discussions. The Contracting Officer may choose to award on the basis of the initial proposals or may conduct discussions with the responding Offerors.

The solicitation in a Negotiated Procurement is a Request for Proposals (RFP). There are three inter-related elements of an RFP. As mentioned above, with the exception of two sections (Sections L and M), the solicitation forms the foundation of the contract. The four inter-related sections of the RFP are Sections B,C, L and M. Section C describes what the Government is buying in terms of the Government’s minimum requirements. What is being bought drives the factors the Government will use to evaluate proposals (offers) and determine the best source.

This evaluation scheme is described in Section M. And, finally, what will be evaluated drives what information Offerors need to submit to the Government in order for that evaluation to be thorough. These instructions to the Offerors are described in Section L.

Negotiated procurements may be either sole source or competitive. Below is a description of some commonly used techniques and strategies for competitive acquisitions.

Evaluation Methods

There are multiple methods of evaluating proposals and obtaining the best value for the Government. One way is through a tradeoff analysis; this means that the Government is willing to pay more for higher quality performance. Another method is to choose the proposal with the lowest price out of all the proposals that were received that were technically acceptable.

Any evaluation scheme involves identifying the factors that will be evaluated and the relative weights of those factors.

In every evaluation, the FAR requires that price or cost must be evaluated.

Fairness in competition

One of the guiding principles in federal contracting is fairness in competition. Fairness is mandated by the Competition in Contracting Act. The Competition in Contracting Act (CICA) was passed into law in 1984 to foster competition and thus reduce costs. The theory was that more competition for procurements would reduce costs and allow more small businesses to win contracts. CICA requires almost all procurements to be competed as full and open so any qualified company can submit a proposal. For the military, the statute is at 10 U.S.C. 2301-2306.

As a member of the acquisition team, you will be developing Section C of the contract, and you should have a basic understanding of the “cradle to grave” concept of contracting (see Figure 1-1 for generic contracting flow). If you are writing the performance work statement (PWS), you will most likely participate in many other aspects of the contracting process.

Requiring activity (unit)

Develop an acquisition-ready package

PWS

development

COR: Performance modeling

Acquisition review board (if required)

Funding

Finance office

Payment

Contracting •

Request for proposal:

Justification and authority Source selection Contract award

Invoice Close out

Contractor (commercial entity)

Performance/deliverables

As part of the acquisition-ready package COR: contracting officer’s representative

Figure 1-1. Contracting flow

Essential Elements of the Contract

Contracts generally follow the uniform contract format as outlined in the Federal Acquisition Regulations. The PWS for a task order under an ID/IQ contract may use a different, often abbreviated, format compared to the standard basic contract format. It may contain different information, based on what is in the underlying contract. Your Contracting Officer (KO) and Legal Office can help you understand the requirements.

(Tip: Pay particular attention to Section C below)

Section A (contract form): This section contains basic information such as the issuing office, addresses, and contract number. It also contains an executive summary that describes the essential features and purpose of the contract.

Section B (supplies or services and prices/costs): This section contains a brief description of the supplies or services and the quantity, and the prices/costs associated with the items/services described in this section.

Section C (description/specifications/PWS): This section contains a detailed description of the requirement and may contain references to other sections of the contract.

PWS format within Section C:

• Section C-1: General introduction

• Section C-2: Definitions and applicable documents

• Section C-3: Tasks

• Section C-4: Performance Requirements Summary

• Section C-5: Government Furnished Equipment

• Section C-6: Security

Section D (packaging and marking): This section provides packaging, packing, preservation, and marking requirements.

Section E (inspection and acceptance): This section contains inspection, acceptance, quality assurance, and reliability requirements. (Inspect all deliverable items, services, or materials to determine satisfactory compliance with the contract. Remember, if you sign the receiving report, it is too late to reject the service or deliverables.)

Section F (delivery or performance): This section specifies the time, place, and method of delivery or performance.

Section G (contract administration data): This section contains: required accounting and appropriation data, required contract administration information, and instructions other than those on the solicitation form.

Section H (special contract requirements): This section should contain a clear statement of any special contract requirements that are not included in Section I, the contract clauses, or other sections of the contract. Local clauses are also included, depending variables such as the place of performance, or the policies of the particular contracting office.

Section I is commonly known as the “boilerplate.” This section includes standard clauses of considerable power that define the rights and responsibilities of contracting parties. It also contains clauses that are mandated by regulations or laws.

Section J is the list of attached documents, exhibits, and other items. Cross-references to material in other sections of the contract may be included.

Section K includes representations, certifications, and other statements. This section includes solicitation provisions that require representations, certifications, or the submission of other information, by Offerors or respondents.

Section L includes instructions, conditions and notices to Offerors (also referred to as vendors where the solicitation is a Request for Quotes rather than a Request for Proposals). This section contains basic information such as the issuing office and address, and the contract number. It provides specific instructions to the Offeror about what information must be included in the proposal. For example, this section tells Offerors what information needs to be provided to address each factor. Section L outlines the format for the proposal in terms of volumes, page limits for each volume, font and margins, electronic submittal guidelines, and other pertinent information.

Section M contains the factors that will be evaluated for award, explains the method by which the Government will evaluate proposals and describes how the award will be made. The factors, subfactors and relative weights of each are described. The process by which the Government will validate price or cost proposals would be explained in Section M. This section contains statements about whether options will be evaluated, and about whether the Government intends to award the contract without discussions. If sample tasks are to be evaluated, this section explains what the Government will be evaluating in the responses to the sample tasks.

Developing the Acquisition Team Contact List

The acquisition team consists of all participants in the acquisition process such as: the requiring activity; finance officer; resource manager (RM); KO; contracting officer’s representative (COR); Small Business Office, Legal Office, and others, as applicable. Successful teams typically assign specific duties to each member; they also develop performance measures, and milestones. Each member of the group, and the group as a whole, will be accountable for the team’s success. Normally, leadership of the team comes from the KO, however the COR plays a critical role in determining the success of the contract after its award.

Contracting Officer (KO): The KO is the only individual expressly authorized to enter into, administer, or terminate contracts. KOs are responsible for ensuring all contract actions comply with appropriate laws, executive orders, regulations, and other applicable procedures. The KO is the only person authorized to discuss financial matters with the contractor, to make modifications to the scope of the contract, or to modify any contract terms or conditions. Communication with the KO is critical because the KO needs to know everything that is going on with his or her contract. He or she is the individual who will be communicating with the contractor on business matters.

Requiring activity: The requiring activity is usually the organization that has a requirement for goods or services.

Attorney: The attorney provides legal advice to the acquisition team and reviews acquisition documents for legal sufficiency. The CECOM Legal Office provides support for all C4ISR organizations.

Contracting Officer’s Representative (COR): A COR is appointed by the KO to represent the KO, and to perform certain functions that are delegated to the COR. In some cases, CORs monitor the technical or performance aspects of a contract. A COR may also review and process invoices. Frequently, CORs also participates in developing the requirement and other pre-award activities so he/she is familiar with all aspects of the contract.

RM: The RM provides advice and guidance to the requiring activity and is responsible for developing command resource requirements, identifying sources of funding, determining cost, acquiring funds, distributing and controlling funds, and tracking costs and obligations.

Others: Other personnel may also be used based on areas of expertise that could affect the requirement and overall acquisition action

Chapter 3

Nine Steps to Developing a Performance Work Statement and

Supporting Solicitation Documents

In addition to the PWS, other documents are required to support the Government’s selection of a source of services or supplies. The foundation of a PWS that contains performance based task statements is a Work Breakdown Structure (WBS). The Government must develop a Basis of Estimate (BOE) in order to develop an Independent Government Cost Estimate (IGCE) of the price or cost of a proposed service effort.

Build the BOE concurrently with the PWS. The BOE reflects the labor categories and the number of hours that the Government estimates will be required to perform the tasks as detailed in the PWS.

The IGCE will be derived from the BOE. Apply labor rates for each of the categories at the anticipated number of hours. The PWS, the WBS, the BOE and the IGCE relate to each other.

Strong correlations between these products are persuasive when facing a challenge by a disappointed Offeror; strong correlations demonstrate that the Government was reasonable and rational in its approach to conducting a fair competition. The Government’s production of these documents in the early stages of litigation discovery, may inform a potential protestor that its challenge to the Government’s action will be futile.

The sections below provide a foundation for understanding how these products relate to each other. They will guide you in understanding the basics of developing these products.

[Tip: Developing a PWS requires collaboration and cooperation between three Government organizations: the requiring activity; the acquisition center; and the legal office.]

Step 1: Planning

Overview

This section discusses four primary components in developing a PWS and a quality assurance surveillance plan (QASP):

• Market research

• Forming the writing team and finding the right resources

• Developing a project plan with milestones

• Developing a decision plan (proactive approach to resolving issues)

Careful planning makes better use of resources, minimizes interruptions in activity performance, saves time, and obtains the service required to support the Soldiers and mission.

Market research

The acquisition team must conduct market research to understand the standard performance parameters in the local marketplace, and then work to draft a PWS that incorporates the appropriate local practices.

Forming your team

Gather the best people for the PWS writing team and obtain leadership support from the beginning. The development of a quality PWS is the result of a team effort. The members of the team are usually from the requiring activity, other organizations with subject matter expertise (such as the end user if that is not the requiring activity), and the contracting office. The team is typically composed of the following individuals:

• The PWS team leader has the authority and responsibility for developing the PWS and QASP.

• Subject matter experts provide functional knowledge to describe the service and recommend how to measure and accept the service. Generally, these experts will be representatives from the technical organizations that will be using the services and supplies (the requiring activity).

• The contracting office provides the necessary authority and technical experience in contracting to approve the final product and initiate the contract.

• Other advisors or consultants such as the legal advisors, small business advisors, and price/cost advisors.

(Tip: There are no absolutes in selecting PWS team members. Required skills are situational, and you should consider them within the context of the entire team.)

Most requiring activities can find individuals to fill these roles, but these individuals often have other duties in a deployed environment. The leadership must make the hard decision to allocate the proper time, resources, and individuals required to develop a proper PWS.

Work space

Do not overlook the need for office space for the PWS team members. The PWS team must have secure facilities where it can store its materials and work with limited interruptions. The need for a secure work area correlates with the discussion below about security concerns.

Security concerns

Do not leave sensitive information on your desk or computer screen and do not discuss this information in common areas. Factors affecting security are the degree of sensitivity of the information; nature of the threat to the information; vulnerability of the information; options that are available for protecting the information; and organizational facilities and capabilities for secure handling, storage, and transmission.

Even if it not classified, much of the information you are dealing with is Source Selection Sensitive. Improper release of information jeopardizes procurement integrity and thus fairness in the competitive process is adversely affected.

The presence of contractors in the workplace is a factor for consideration. Any discussions relating to the competition must take place in the presence of involved Government employees only. This is another precaution to preserve the integrity of the competition.

Contractor employees may have limited access to competition/source selection documents, but only if they have signed the appropriate participation and non-disclosure agreements and all organizational conflict of interest concerns have been addressed.

Remember, the acquisition process begins at the point the Government’s needs are established. All personnel should understand the adverse impact of inappropriate disclosure of sensitive information regarding future procurements. Early in the acquisition planning process and throughout the development of the Government’s requirements in writing the PWS, the KO will advise the acquisition team of the negative consequences and prejudicial impact of improperly releasing information to potential future Offerors.

Initial team meeting

The PWS team leader should receive guidance and training from the supporting contracting and legal offices.

During the initial meeting, team members should:

• Introduce roles and responsibilities.

• Begin to identify issues.

• Review all documents to date (initial requirements document, purchase request, and other supporting documents).

Go over this checklist for the team’s key players:

Key Player

Tasks

Requiring activity

Participate actively and continuously in PWS team meetings to ensure that the Government’s minimum requirements are properly reflected.

Provide core data regarding task statements, surveillance techniques, history of similar requirements and performance.

Review PWS at 100 percent completion and provide final comments before the PWS is finalized for solicitation.

PWS team leader

Oversee the PWS team and stay on schedule for completion of the PWS and QASP.

Develop the QASP in coordination with other team members.

Assign tasks to team members, including writing sections of the PWS and formatting the technical exhibits.

Monitor team members to assure they complete the work as scheduled.

Arrange for review by customers, stakeholders, management, and requiring activity when 75 percent complete and incorporate recommended changes.

Arrange for review by requiring activity and incorporate recommended changes.

Key Player

Tasks

PWS team leader (continued)

Conduct team meetings as needed to review work completed, assign new tasks, and respond to questions from the team.

Develop evaluation criteria in coordination with other team members.

Contracting office

Assist the requiring activity and PWS team in the development of the

PWS.

Arrange for review of the PWS.

Ensure the PWS is adequate and the evaluation criteria are appropriate to serve as a basis for the contract award.

Legal Office

Assist the PWS team.

What is the milestone schedule?

Perhaps the most overlooked planning step is developing the milestone schedule. The milestone schedule provides overall, critical completion times for each major requirement and appropriate review and coordination (when required). Keep in mind that milestones may be changed for larger, more complex contracts (consult your supporting KO for further details).

Milestone schedule example:

Requirements documents completed

0X/0X/20XX

Statements of work and PWS approval

Acquisition review board

Funding for purchase request

Request for quotations

Receipt of quotations

Evaluation of quotations

Discussion

Legal review of documents for award

0X/)X/20XX

Award of contract and notice to proceed 0X/0X/20XX

(Tip: Early planning including the user and all acquisition team members to the maximum extent practicable is essential in determining overall success. Ultimately, the KO will decide upon the precise milestone dates; making sure it works with the requiring activity objective. Note that these schedules must include sufficient time for preparation of documents as well as for appropriate reviews and modification of those documents as appropriate. Time will NOT be saved by skipping these steps or failing to allow proper time for them. Also remember that delays in the early part of the process do not mean that later parts of the process can be sped up to make up for those delays.)

Step 2: Brainstorming the requirement

Planning should start by focusing on the big picture of the acquisition. What requirement needs to be satisfied, and how will this acquisition meet the needs of the requiring activity? The requirement should also address the criticality of need.

Step 3: Verify, Vet and Refine Goals or Outcomes

Most of the data should be collected during preliminary planning and available to the PWS team already. However, your data may be marginal. For example, the purchase request may only say “contract to clean office headquarters building number 123 on forward operating base ABC.”

If your data is marginal, conduct interviews to gather further details:

• Customer view: Ask the supported customer what he or she expects from the contractor. This question should be asked and answered in writing.

• Requiring activity view: Obtain higher-level guidance and expected outcomes. Many times the customer’s view and his headquarters’ view will differ and you must hash out the must do from the nice to have.

• KO view: You can compare your requirement to the same type of activity provided by a preexisting or old contract on file with your supporting contracting office. Often using a similar, preexisting PWS will assist you in developing your own. Do not reinvent the wheel unless you have to but do not simply copy another PWS; no two are alike.

[Tip: The old PWS may not include performance based task statements. See examples in Appendix 1.]

Manage expectations from the beginning and ensure the requiring activity approves the initial concept before you start writing the PWS.

[Tip: The PWS is your roadmap for the contractor’s performance. Ensure it accurately reflects the specific tasks and obligations during the course of performance. Most contractual problems are directly attributable to the lack of a properly written PWS.]

Step 4: Create a Work Breakdown Structure

Use the WBS to facilitate a logical arrangement of all elements of the work targeted in a performance-based contract. Simultaneously, use the checklist provided below for the performance-based acquisition team to trace all the necessary elements of the project.

Generally your WBS will only serve as an internal planning document. Do not use the WBS in your actual PWS.

Creating a WBS checklist:

• Identify the overall service or output required from the contractor.

• Divide the job into all its parts and subparts.

• Clarify the relationships among all the parts.

• Write one requirement sentence describing the desired result of each subtask.

• Conduct a review and finalize the WBS.

Finalizing the WBS checklist:

• Check the scope statement for completeness and accuracy.

• Check that each activity is broken down into all tasks necessary for that activity to be completed.

• Check that all tasks are identified and defined in “do what” terms not “how to” terms.

• Check that completion criteria are defined for each task.

• Check that the data requirements (reports, software, or other deliverables) have been identified and associated with tasks.

• Check that all required Government-furnished property has been identified.

WBS Example

The figure above is an example of a WBS for Satellite Communications.

At each level of breakdown, the parts must be mutually exclusive and collectively exhaustive of the next higher level. Furthermore, there must be no overlap among the parts at a particular level, and nothing must be left out.

Step 5: Identify Desired Results

Results are what the acquisition is intended to accomplish. The desired results are the ideal outcomes of contract performance.

Here are some examples of desired results.

1. All Help Desk inquiries are answered in two hours or less.

2. The System Design Plan is complete, accurate, reflects professional engineering standards and is submitted in accordance with the milestone requirements.

3. Ten employees per month shall be trained to a level XXX proficiency on the new system.

The PWS team must ask what it wants out of this acquisition and define what the tasks intend to achieve in terms of outcomes and deliverables. The answer will be specific to each acquisition, and the team should develop the answer during its work sessions.

This analysis will provide the basis to develop a WBS for formulating the PWS.

Begin by listing what the PWS should accomplish in order to satisfy the overall requirement. For example:

• What outcome is needed?

• When is the outcome needed?

• Where is the outcome needed?

• Who needs the outcome?

• Why is the outcome needed?

• What will be done with the outcome?

• What will occur as a result of the outcome?

• Is the outcome worth the effort and cost?

• Would a different outcome be preferable?

After the team clearly identifies the desired results, it must identify what outcome will constitute success. For example, the customer desires a satellite link to be installed and operational. So, the installation must be done correctly, with an operational link established and tested. The task might be to establish an operational satellite link between two points in accordance with applicable standards and specifications.

Defining successful contract performance means defining how the customer knows if the link is established and tested—what is the testing procedure, and how is it performed?

How, and when, and by whom will the contractor’s performance be accepted?

Keep in mind the link between level of service and cost; it is important to define the level of service required so as not to unnecessarily exceed requirements and cost. Polishing the brass doorknobs may improve the Feng Shui feeling for the commander but at what cost?

Step 6: Develop Performance Requirements Summary (PWS Section 4)

This involves conducting a performance analysis to identify the appropriate performance standards and an Acceptable Quality Level (AQL) for each task.

The question is:

When or how will I know that the outcome has been satisfactorily achieved, and how much deviation from the performance standard will I allow the contractor, if any?

The answers will be in the Performance Requirements Summary (PRS). This summary is a table that describes the result the Government wants for each task. It is a handy, at-a-glance reference to the result required for each task and the associated AQL.

A performance analysis is a process that identifies how performance of a task should be measured and, thus, what performance standards, (e.g., timeliness or quality levels) are appropriate and reasonable for that particular task.

After determining how performance of a task should be measured, identify AQLs. The Office of Federal Procurement Policy defines the term AQL as follows:

“The allowable leeway or variation from a standard before the government will reject the specific service.”

AQLs constitute a minimally acceptable level of performance. They are typically stated as a percentage of required conformances (e.g., clean, 95% of the time), or as a number of permissible deviations (e.g., 1 error per x time period). In developing AQLs, you are asking, “What minimum level of quality do I need to meet my mission needs?”

Performance standards and AQLs are very important in that they identify acceptable levels of performance. Developing and setting performance standards and AQLs are judgment calls based on the needs of the mission, available expertise, and market research. The members of the acquisition team should work closely with each other when developing standards and AQLs. See Appendix A for examples of performance standards and AQLs.

TIP: Exercise care in establishing AQLs for performance standards. Often, the closer to 100 percent perfection is required, then the higher the price. It is also important to ensure that performance standards are measurable. Think carefully when establishing a100 percent standard since this threshold can directly affect the price. AQLs of 100 percent can be unreasonable or unrealistic for some performance objectives. However, if the performance objective is critical (for instance, if it covers a life-threatening matter), 100 percent is acceptable. Conversely, if the AQL is set too low, it could act as a disincentive to good contract performance.

TIP: Market research may be helpful for this area. It might reveal that a particular service area may have specific, commercially acceptable performance standards that are expressed in terms other than percentages or deviations. It is generally wise to use commercial standards unless otherwise inappropriate for the requirement. You might find it necessary to establish your own performance standards.