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Selling the VECP

Selling the VECP Contractor Markets Preliminary Idea to Government Contractor Determines & Markets Proposal Strategy Government Expresses Technical Interest Government Expresses Support for VECP go to Idea Generation go to VECP Approval


Contractor Markets Preliminary Idea To Government

 

  • This is a low key activity designed to gauge whether there is any government interest-no commitment exists.
  • Contractor should brief the idea to the government technical team or equivalent thereof.
    • Limited contractor investment in the brief.
    • It is a good idea to develop a rough order of magnitude pricing and potential savings.
    • Contractor should also indicate potential risks in cost, schedule & performance.
    • It is important to address when the VECP effort is completed, i.e., when the new configuration is tested and qualified. The government can kill any VECP by burning up all the saving though expensive government testing. This is somewhat unique with missiles and aircraft because of safety, but is always a concern. That is why "qualification" is included even in some preliminary briefings. The contractor wants the government to agree that its approach seems correct. For example, the contractor might suggest that if a flight test is required, it be a "ride along" as part of another flight test so there is virtually no cost.
  • It is generally advantageous from a buy-in perspective to also include a short synopsis or information paper.
  • Contractor should also seek feedback on government needs.
    • Should the idea be modified?
    • Are there other areas where the government would be receptive to VECPs?
  • Desired outcome: statement of government interest and technical feasibility.
    • Government tells contractor exactly what additional technical information should be provided.

Contact Industry VECP Expert

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Government Expresses Technical Interest

 

  • View contractor's suggestion as an opportunity for the government to both save money and improve performance.
  • Ensure the right people are present.
  • Be constructive; make suggestions on how the ideas can be improved.
  • Provide the contractor with an honest and complete assessment of what is presented as well as additional technical information that you want to see.

Contact Government VECP Expert

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Contractor Determines and Markets Proposal Strategy

 

These are some of the key things that the contractor thinks about internally before formally presenting the idea to the government.

  • How the VECP should be proposed, i.e. as a "voluntary" effort on its part (maximum risk but maximum savings) or try to get a "mandatory" clause incorporated for the effort (risk reduced due to government sharing the risk and government funding all or part of the development and implementation costs. Because of the reduced risk, there is reduced sharing benefit to the contractor).
  • Who should invest what (contractor or government), and implementation point for maximum saving and return.
  • How big or small the VECP (assuming it is not a simple one-item change) should be. When dealing with long, stable production runs, it may be desirable to break the proposed change into two or more VECPs to ease processing or approval or it may be helpful to lump several smaller changes into one big change. Combining ideas may be done for marketing purposes. Often the government wants to change something, but cannot afford to do so. The contractor might incorporate the government's desired change into the VECP (even though the Government desired change saves little or nothing). By letting the Government desired change "ride along" and become a part of the VECP, it can make the latter more marketable. The same would hold true for some things the contractor wants to change that would not be economically viable unless part of a larger VECP.
  • Which contract could/should be the instant. There are many factors to consider such as which one will have the most impact, re-bid considerations, etc.
  • Savings period/share (3 to 5 years).
  • Implementation schedule (when do we need to commence activity?) - The contractor should explain how it might be accomplished as soon as possible.

The contractor should prepare a formal presentation to the government justifying the VECP.

  • On simple VECPs, a formal presentation may not be required, just a courtesy heads-up phone call to the recipient and the offer of further information.
  • Otherwise, this is the most important facet of the VECP process.
  • Briefing is normally made to the PM and all relevant stakeholders (finance, technical, logistics and contracts); should include the activity VE POC/expert.
    • Coordinate with the PM to ensure the proper attendance (government and contractor).
    • Clarify agenda and discussion topics. Talk with the government counterparts about exactly what people will want to see.
  • Desired outcome: government provides all of the feedback necessary for the contractor to submit a VECP; buy-in from PM to submit.
    • This statement should be worded carefully so that an "approval contingent on the additional information being provided" is not implied. The government cannot imply approval at this point, only level of interest and potential concern areas or "suggested" information to be provided. Also, the contractor is not "obligated" at this point to provide anything.
    • Through discussion with the government, the contractor gains insight into what information would be helpful for the government to make a technical and contractual decision on the VECP.
    • There is usually a lot of interaction at the meeting. It is important for the contractor to deal with questions on negative impact (if any) by showing how far the benefits out weigh them.
  • Maintain interaction with the government as needed while the VECP is being prepared (very important element for both parties).
    • Usually the contractor responds to questions or concerns. These could be logistics impacts, testing questions or the government wanting to include something else in the VECP. These don't always result in another briefing, but if required, the Contract Administrator or Contract Program Manager would arrange for the briefing.

Contact Industry VECP Expert

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Government Expresses Support for the VECP

 

  • Government must evaluate the idea from a technical and financial perspective. All technical, cost and logistics concerns should be communicated to the contractor at that time.
  • PM or his representative should tell the contractor how to modify the idea to make the VECP more acceptable.
  • PM should be unambiguous about the desire for a formal VECP.

Contact Government VECP Expert

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