What Can Be Done Right Now to Improve SATCOM Procurement?

There is currently an effort going on to re-examine and revise the way government procures commercial SATCOM. This effort has been publicized here on SatCom Frontier and in other respected publications. The discussion and the progress made to date have been encouraging.

That said, these efforts are part of an ongoing debate to define a solution and therefore are not impacting today’s procurement. What we need to do is “bridge the gap” between an imperfect present and (hopefully) a not too distant future when legislative initiatives underway provide government agencies with better alternatives for SATCOM procurement.

Unfortunately, today we remain constricted by the fundamentals terms of the Antideficiency Act, which limits most contracting to expensive one year terms. But even these shorter term contracts can be made more equitable and efficient. It’s time for both contractors and the government to re-examine the current procurement system’s rules and SOPs recognizing the commercial issues that these recent debates have highlighted.

More creative thinking on both sides could squeeze more efficiency out of the current procurement structure. The approach needs to recognize the existing weaknesses, and embrace the fact that the marketplace has fundamentally changed.

For industry, the most pressing question is how to best support government needs and the warfighter in an era of much tighter budget constraints. For the government, the big question is how to provide incentives to the Industrial base to accept the market risks inherent in meeting customized government needs.

Here are some recommendations to get this re-examination started:

  • Government could continue to learn about how the commercial industry views “terminations for convenience” – an overused and at times overly punitive approach to budget shortfalls that government would never tolerate from any of its providers;
  • Contractors can foster more engagement earlier in the process by providing government with more transparency into commercial best practices, and highlighting alternative pricing when feasible;
  • More shared understanding that the increase in incrementally funded contracts expose the contractor to great risk and financial uncertainty, given that operators price services based on year long commitments;
  • Collaboratively select the FAR termination provisions most appropriate for the services being provided.

As our president Kay Sears has eloquently stated, commercial operators have been there for government customers for more than 20 years. There is an encouraging dialogue going on regarding how to make the partnership even stronger moving forward.

While we wait for the new procurement vehicle to be built, there are definitely ways to tinker with the old model.

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