OP-ED: Exploring OASIS – The “Myth of Transparency” & the working poor of federal contracting

On Thursday, May 23, 2013, Jim Ghiloni submitted a blog post titled “Exploring OASIS – The Myth of the Perfect Score [https://interact.gsa.gov/blog/exploring-oasis-myth-perfect-score].” In this post, Jim explains how in various hypothetical situations, firms that objectively score themselves as “average or below” using the criteria established in the initial draft RFP, should not fret and submit proposals anyway. Further, he goes on to say these firms are “encouraged” to not be concerned about their score, that the only real question that remain are, and I quote:

“Among the pool of potential bidders, is my score in the top 40, and is my pricing in line? I know we all like to get an “A” and you might be dismayed to see that your score is only 70% of the maximum, and thus potentially a “C.” Fear not. We’re grading on a curve here, folks.”

Well, Jim is a nice enough guy; but this is as akin to a Freudian slip as ever was one. Folks, let me qualify what I am about to say before I say it; if you play the lottery for any purpose other than sheer entertainment or believe in the Easter Bunny, please do not read any further.

Now that the room is cleared and only the sober remain > for your small business, this is not an academic exercise; this is business. The fact that – based upon the hype, the anemic number of solicitations out for bid right in the federal market, and the sheer potential of the opportunity; – the majority of professional services companies in the country are planning to submit proposals on OASIS gives it a lottery persona. That is, one in which the herd theory applies because Smalls are hungry.

When this happens, you get a large noise quotient in your market equation for success; and as a result everyone’s probability of winning is reduced significantly. And, who benefits for this type of mass hysteria you ask? The GSA does of course. The reason is, because this is a new contract instrument; the GSA does not have a legitimate government estimate – and they desperately need one. In short, whether you win or not; your pricing is going to help the GSA build its own price curve – and this curve is going to be used to negotiate down the prices on yet to be awarded task-orders.

What is the significance of this to you, you ask? Well, those of you who realistically know that you have average or sub-par quals are probably going to try to over-compensate this weakness with lower pricing than the market will bear. You’re so low on Maslow’s Hierarchy that you’ll do anything for a crumb. But guess what, you’re not going to win – the only thing you will do is insure that if you ever get on a team, the margins will be so low you and your partners will be eating sardines as a result. It will be the GSA Schedule wars all over again…

FLASH-BACK –> remember how the GSA in the 80’s incrementally beat everybody down to a 90% or lower price point the best price they gave their best private sector customer? Don’t be stupid.

So in sum; if you score yourself at anything less than the 85th percentile; don’t submit a proposal and contaminate the pool, team afterward instead. And, if you score in the 85th percentile or above, don’t low-ball your pricing. Many of you don’t realize how important this initial baseline is going to be in determining whether there is a middle-class for this contract vehicle or just the working poor. Hold the line and stay unified, as with all new vehicles; Smalls will never have this opportunity again.

Remember, Smalls are the middle-class of federal contracting, and don’t you ever forget it. One Voice…

Rudy Sutherland

the Secretary of Defense for Small Business

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