How a lawn mowing contract is changing Defense acquisition

The Naval Sea Systems Command decided it didn't make sense to create one set of contract specifications for lawn mowing services at a base on the East Coast and another set to cut the grass on the West coast, when in fact one contract would work for both places.

Now the leadership at the Defense Department wants to extend this simple concept departmentwide.

Defense spends $200 billion a year, half its annual budget, on services ranging from lawn mowing to software maintenance. Ashton B. Carter, undersecretary of Defense for acquisition, technology and logistics, wants to rein in that spending as part of an overall plan Defense Secretary Robert Gates announced on Tuesday to cut $100 billion from the Pentagon budget during the next five years.

In a memo to Defense acquisition managers issued on Tuesday, Carter said an ever-expanding set of requirements and missions -- "missions-requirements creep," he called it -- for services has contributed to an increase in spending during the past decade. "These requirements often require the same function or service to be provided, but are written uniquely so that competition is limited," he said in his memo.

Carter directed acquisition managers to develop templates for performance work statements, or definitions for what a unit wants to buy that are included in every solicitation. He cited as an example NAVSEA's SeaPort-e electronic marketplace, which was created to purchase a variety of services from 2,217 vendors -- including lawn mowing services. The platform provides a standard way for a diverse group of large and small businesses to bid on solicitations.

Cindy Shaver, SeaPort-e program manager, said NAVSEA's experience since the buying platform began in 2001 shows standard work statements enhance competition and save the Navy and vendors time and money.

Officials originally developed SeaPort-e to serve only NAVSEA, but it now manages acquisitions for all the systems' commands, including the Marine Corps and the Defense Threat Reduction Agency.

SeaPort-e first issued the work statements for the acquisition of basic services needed to maintain bases -- such as lawn mowing or maintenance -- because these could be easily standardized. Potential bidders then could develop standard responses, which would cut bid and proposal costs. The contractors passed those savings on to the Navy, Shaver said.

In addition, the templates for similar services eliminated potential bidders' concerns that a work statement was developed with a specific vendor in mind, she added.

NAVSEA plans to develop templates for program management support services. Although support for a ship-building program might seem quite different than the support required for a missile program, the services are the same, Shaver said. Preparation of a budget for a ship project is similar to the budget for a weapons program, and by looking for commonality rather than differences, the Navy can enhance competition and save money, she said.

Carter also directed acquisition managers to award more services contracts to small businesses because they provide Defense with "an important degree of agility and innovation," with lower overhead costs. SeaPort-e has a high percentage of awards going to small businesses. So far in fiscal 2010, it has issued 4,692 task orders with a total potential value of $6.8 billion, with small businesses taking home 85 percent of the awards.

Shaver said increased competition has been the primary reason it has saved money. The Navy's goal is to have 100 percent competition on every SeaPort-e task order, a goal that will be met more easily with standard work statements, she said.