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Quality Assurance & Post Award Performance Measurement

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION BETHESDA NORTH MARRIOTT HOTEL & CONFERENCE CENTER BETHESDA, MD
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Page 1: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACTMANAGEMENT ASSOCIATION

BETHESDA NORTH MARRIOTT HOTEL & CONFERENCE CENTER BETHESDA, MD

Page 2: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 2

QUALITY ASSURANCE & POST-AWARD PERFORMANCE MEASUREMENT

Marc Berson, Director, Grant Thornton LLPEric Heffernan, Senior Manager, Grant Thornton LLP

Thursday, November 202:10 – 3:10 pm

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 3

QUALITY ASSURANCE AND POST-AWARD PERFORMANCE TOPICS

Policy & Guidance

Quality & Performance throughout an Acquisition

Lessons Learned

Questions & Answers

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 4

IN BRIEF

"It's much more difficult to measure nonperformance than performance.“

- Harold S. Geneen, CEO ITT

"What gets measured gets done, what gets measured and fed back gets done well, what gets rewarded” gets repeated

- John E. Jones, Federal Judge

"You get what you measure. Measure the wrong thing and you get the wrong behaviors."

- John H. Lingle , Business Author

Page 5: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 5

POLICY & GUIDANCE

• Performance Based Service Acquisitions defined– Public Law 106-398, section 821– FAR Section Subpart 37.6– FAR Section Subpart 46.4

• OFPP pamphlet No. 4: "A Guide to Writing and Administering Performance Statements of Work for Service Contracts (1980)

• SARA Acquisition Advisory Panel Report Chapter 2: Improving Implementation of PBSA in the Federal Government

• 2006 Survey of Acquisition Executives finds few know how to do it right!

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 6

"Could use performance incentives more effectively"

"Has relied on invalidated contractor data to monitor and assess contractors performance"

SAMPLE GOVERNMENT ACCOUNTABILITY OFFICE REPORT

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 7

WHY IS QUALITY ASSURANCE AND PERFORMANCE MONITORING IMPORTANT?

• Continuity and consistency in the delivery of

products or services

• Means to hold vendor accountable and provide a

basis for incentives/disincentives

• Provides a structured process for evaluation

• Means to hold the vendor to an expected level of

service

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 8

ADDRESSING QUALITY AND PERFORMANCE THROUGHOUT THE ACQUISITION LIFE-CYCLE

• Critical to a performance-based acquisition, yet often times the most overlooked

• Guided far less by law, regulation, and policy

• Is in the best interest of all parties for a successful contract

• Leads to improved performance over time

• Transparency of post award monitoring with other federal agencies

– Agency IGs– GAO– OMB

Contract T

ype

Performance

Requirements Summary

Cost Impact

Evaluation

Criteria

Qua

lity

Man

agem

ent

Pla

nC

on

trac

t C

lau

ses

&

Ince

nti

ves

Quality A

ssurance

Surveillance P

lan

Perfo

rman

ce R

epo

rting

Performance MeasureDevelopment

Emphasis onPerformance

Planning

Man

age &

Measu

re

Pro

cure

men

t

Page 9: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 9

PLANNING

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 10

THREE CONCEPTS TO CONSIDER IN DESIGNING PERFORMANCE MEASURES

AlignmentAlignment Measure Measure TypesTypes

FrameworkFramework

Measures should directly support or be

in alignment with objectives and requirements

Measures should be defined in the context of a performance management framework

Various types of measures should be

considered

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 11

BALANCED SCORECARD FRAMEWORK

What measures within each perspective can help indicate whether an objective was achieved?

Program Success

Fina

ncia

l Custom

er

Lear

ning

& G

row

th

Process

EVMCustomer

Complaints

CertifiedEmployees

Error Rate

Cause & Effect Relationship

Integration of External &

Internal Measures

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 12

MEASURE SELECTION CRITERIA

MEANINGFUL – Related significantly and directly to organizations

mission and goal

VALUABLE – Designed to measure the most important activities of

the organization

BALANCED – Inclusive of several types of measures

PRACTICAL – Affordable price to retrieve and/or capture data

COMPARABLE – Used to make comparisons with other data over

time

CREDIBLE – Based on accurate and reliable data

TIMELY – Designed to use and report data in a usable timeframe

SIMPLE – Easy to calculate and understand

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 13

PROCUREMENT ACTIVITIES

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 14

INTEGRATING PERFORMANCE METRICS

Statement of Objectives

QASPMonitoring Procedures

PRSPerformance

Metrics

Performance measures must be identified for

requirements defined in the

SOO

Monitoring tools and techniques are outlined in

detail

Page 15: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 15

IMPORTANT QUALITY AND PERFORMANCE SOLICITATION REQUIREMENTS

Performance Oversight Board

Source Selection Evaluation

Quality Management Requirements

Ø FAR 46.4: Government Contract Quality Assurance

Ø ISO 9000:2001: Requirements for Quality Management Systems (other standards)

Ø ASQ Certifications: Six Sigma, Certified Quality Engineer(s)

Ø Program Management Institute: PMP/PgMP, Earned-Value Management

Ø Incorporate Perf. Mgmt and QA as part of Section M: Evaluation Factors for Award

Ø Require submission of the vendors Quality Management Plan (QMP) as part of Section L: Instructions to Offerors

Ø Include Quality SMEs as part of evaluation team

Ø Incorporate Perf. Mgmt and QA as part of Section M: Evaluation Factors for Award

Ø Require submission of the vendors Quality Management Plan (QMP) as part of Section L: Instructions to Offerors

Ø Include Quality SMEs as part of evaluation team

Ø Encourages discussion and coordination with service provider

Ø Establishes partnership between service provider and government

Ø Provides an objective perspective on performance

Ø Involves key stakeholders to accomplish agency objectives

Ø Encourages discussion and coordination with service provider

Ø Establishes partnership between service provider and government

Ø Provides an objective perspective on performance

Ø Involves key stakeholders to accomplish agency objectives

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 16

WHAT IS A QUALITY MANAGEMENT PLAN?

• Documents how an organization structures its quality system that describes their:– Policies and procedures– Criteria for application– Roles and responsibilities– Tools used for measuring quality– Processes and corrective action

• Provides a "blueprint" on how vendors will implement specific quality assurance and quality control activities for a specific activity

• QMP level of detail should mirror the scope of the program

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 17

EXECUTING AN INCENTIVE PROGRAM

• Clearly articulate incentive clauses in both the solicitation and resulting contact, which may include non-monetary alternatives– Financial impact– Frequency of assessment

• Develop auditable and verifiable data collection trail

• Determine clear payout (or reduction) timelines and prepare finances accordingly

• Be diligent!

Page 18: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 18

MANAGE & MEASURE

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 19

WHAT IS THE PERFORMANCE REQUIREMENTS SUMMARY (PRS)

• Typically part of both the solicitation and the QASP that identifies the performance outcomes expected by the Government

• Can be transformed into a "scorecard" for overall vendor performance

• Determines the how well a vendor is performing

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 20

SAMPLE PRS

Definition Unit of MeasureAPL

Sources of DataMeasure

Detailed description of

measure

Unit in which to express measure

Maximum deviation from

standard

Sources to seek for data collection

Wait time

Error RateReorders as a percent of total orders fulfilled

Percentage• 90% order

accuracy

• Order log in workload management system

Average time customers wait in line before cashier

greets them – weekly average

Minutes• 80% of customers

greeted in 5 minutes

• Wait time log

Page 21: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 21

WHAT IS THE QUALITY ASSURANCE SURVEILLANCE PLAN (QASP)

• Defines process for performance monitoring & evaluation by

the government

• Designed to implement and enforce the PRS

• Identifies the surveillance methods that will be used to apprise

the Government of the vendor performance

• The Government retains the right to modify the QASP

– Reasons may include: surveillance method, increase/decrease

degree of effort, and change procedures

• Identifies procedures to correct deficiencies observed in vendor

performance

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 22

QASP IN ACTION

• The QASP provides the bridge between the work requirements in the SOO and actual performance by the vendor.

SOOSOO QASPQASP

Page 23: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 23

CORE QASP COMPONENTS

Obtain Data

Mo

nito

r Ve n

do

r Acti o

n P

la ns

Do

cum

e nt an

d A

naly ze D

a ta

Report Performance Information

QASP

Ensure data is:– Obtained– Recorded– Analyzed– Reported

Page 24: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 24

REPORTING PERFORMANCECONSIDER ENABLING TECHNOLOGIES

– Enabling technologies provide accountable, intuitive, automated processes to collect data, measure it, and evaluate vendor performance while:

• Reducing levels of effort

• Increasing standardization

• Enhancing the quality of work products

• Providing and storing data that can be tracked and audited

Page 25: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 25

REPORT PERFORMANCECOST AND PERFORMANCE MANAGEMENT TOOLS

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NATIONAL CONTRACT MANAGEMENT ASSOCIATION 26

LESSONS LEARNED• Planning

– Incorporate quality and performance throughout the acquisition life-cycle– Assess the cost impacts of any quality and performance initiatives– Contract type may help determine the type and degree of required

oversight• Procurement

– Include quality and performance management frameworks as part of your solicitation documents (B, C, L, M)

– Government should determine performance measures to support program goals

– Consider the use of a performance oversight board• Manage and Measure

– The QASP should be developed on how the program will organize itself to monitor the selected vendor

– Modify the procedures as necessary, should be a living document– Provide quality and performance monitoring training to all stakeholders – Prioritize limited resources to accurately document vendor performance– Create mechanism to recommend changes to the PRS, may require a

contract modification– Automate Quality & Performance Management System(s)

Page 27: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 27

QUESTIONS AND ANSWERS

Page 28: Quality Assurance & Post Award Performance Measurement

NATIONAL CONTRACT MANAGEMENT ASSOCIATION 28

nMarc BersonDirector T 703.637.2716C 202.236.1182E [email protected]

Eric HeffernanSenior Manager T 703.637.2769E [email protected]

Jennifer PalazzoloManager T 703.637.2846E [email protected]

GRANT THORNTON CONTACTS

Global Public Sector333 John Carlyle Street

Suite 400Alexandria, Virginia 22314

703.837.4400


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