Incorporating Incentives Into Performance-Based Contracting Case Study

Government contracting is a lucrative industry, both large and small management and technology consulting firms along with defense, aerospace and other companies who bill themselves as "experts" in various different areas complete for billions of dollars in government contracts each year. The benefit of the federal government leveraging the skills and expertise is great; but there is also a downside. Ethical violations can and have occurred within the government contracting arena. This paper will discuss a case that demonstrates ethical violations in government contracting as well as answer the question of how ethical violations in government contracting affect the role of contracting management acquisition.

Although reducing costs and improving services have been cited as the most important reasons services are privatized by agencies, contracting out offers the attractiveness of hiring a contract employee over a public employee. This occurs because of the apparent advantages offered by such options (Dilger et al. 23). Some advantages of hiring a contract employee over a civil servant are as follows:

Procurement is the process of selecting suppliers and signing contracts for the purchase of goods and services. While simple in definition, quite the opposite is true when it comes to execution. When speaking about public and private sectors, they are two entirely different entities. They have different work principles, different functions and responsibilities in the economy, and different limitations to do work. In the case of government acquisition, the leading and primary objective is for public good, not profit. For a private venture, it is profit for the shareholders. A private company has to have profit as the first priority when awarding procurement contracts. Due to this obvious dichotomy, contractors generally either service

Highly publicized incidents such as the federal government purchasing at $500 hammer or $2,500 toilet seat continue to capture headlines as examples of a federal procurement process gone awry, but these notorious examples have become few and far between in recent years, due in large part to significant reforms such as the Federal Acquisition Streamlining Act of 1994 that minimized some of these problems. Despite these substantive reforms, the federal government continues to receive criticisms concerning the manner in which it administers the procurement process. In order to gain new insights in this area, this paper provides a review of the relevant literature to describe the legal and administrative framework and socio-economic considerations of the federal procurement process. A summary of the research and important findings are presented in the conclusion.

The federal government has expanded its mission without expanding its workforce — outsourcing the administration of programs to state and local governments, to for-profit businesses (i.e., the military-industrial complex) and to large social service nonprofits. It is, says DiIulio, “a uniquely American, superficially anti-statist form of big government.” Not all proxies are bad.

Outsourcing is now part of the American Culture. The American government also falls onto this trend to. Even though the U.S. government is attempting to create laws to stop outsource they are also part of the same problem. The government also has the responsibility to make profit and save on cost for the sake of the economy, and “While private companies are spearheading the outsourcing movement, they are not alone. Federal, state, and local governments are outsourcing government services”

As of the writing of this paper StaffSoultions Inc. has no results in raising funds with our initial plan of government contracting. The main reason for this lack of funding, which is directly due to lack of effort. Also changes in the government contracting environment.

Even though the government can benefit from more efficient practices from private entities, the ultimate decisions for many things will still be the government responsibility. There are other tasks that should be government controlled such as “procuring resources, managing crises, and securing contracts” (Busch and Givens). For example, private organizations can provide goods and services for the government through contracts, but the contracts must be approved by government employees. In hiring government employees, the government makes the ultimate decision for public positions. This could potentially create a conflict of interest. In addition, there is an increased need for transparency about government agencies reporting to Congress and to the general public. There are certain oversight issues that could be tricky to address. For example, public workers are usually expected to have higher ethical standard and greater accountability while private sectors are not as equally strict. Furthermore, changes in the political environment also affect the homeland security context. Newly elected officials can modify homeland security budgets and policies for other contemporary issues. This will affect homeland security long-term planning because private organizations may not be able to adjust to new budget cuts or policy changes while keeping the original homeland security objectives intact (Busch and

Abstract: This paper evaluates a request for proposal (RFP) from Homeland Security Department. It examines the RFP to determine whether it aligns with standard government bid solicitations. The paper also considers the impact of the RFP on competitive pricing. This paper concludes with an examination of how a large firm would file a protest against a smaller firm that acquired the government contract after bidding on the government issued RFP.

There are two kinds of privatization, private provision of service with a “public” character and the process of returning to the private sector property’s or functions previously owned or performed by government. (Shafritz/Russell/Borick pg. 106-107). The private sector is guided by the motive of money and in the United States, where there is more of a free economy, the private sector is wider in comparison to countries like China. Some argue certain public goods and services should remain primarily in the hands of government. An example of this, is law enforcement, basic health care, and basic education. In comparison, some feel that government should steer rather than row.

According to the Organisation for Economic Co-operation and Development, many public agencies in the recent years followed the contracting-out trend (Organisation for Economic Co-operation and Development, 2009). Currently, the private sector performs activities and functions that the public employee once executed. Some of the services that the government contracted include vehicle towing, health services, police protection, and solid waste collection. In 1995, a survey that was referred to the city managers of America’s largest cities revealed that only three of the 66 cities that responded to the investigation had not privatised any city services. Therefore, the problem not only translates to administration but staffing concerns by many managers.

Contracting out is the process through which public organizations contract with private sector organizations to provide services normally provided by public agencies. It is a form of privatization, which is defined as any shift of activity or functions from the state to the private sector, more specifically, the shift of production of goods or services from public to private. (Starr, 5) Privatization reduces the role of government and increases the role of private sector agencies. However, public agencies maintain ultimate control over the provision of services and they control government funding.

It makes the calculation of the payment of the contractor easier according to the amount of the work he did .

Construction Management – this is where the contractor is brought into the design stage early and has an in-put into the design. The contract is not yet drawn up.

Beginning in the 1980s, many jurisdictions started to seek third-party alternatives to provide public service under the pressure for cost savings and the call for government efficiency. Private organizations are known for their expertise in specific fields – if leverage private sector know-how well, it can bring success to public sector – high quality public services can be delivered with lower costs. Therefore, public organizations can concentrate on solving critical tasks when they contract out the mundane work to private sector. Outsourcing waste management is one of the effective privatization solutions for public organizations given its easy-to-measure nature, and it continues to be popular among local governments. Nevertheless, the success of privatizing government services is not guaranteed. If not manage privatization well, it could result in increased costs, organization structure and culture change or legal liabilities. In addition, take advantage of privatizing public services redefines the nature of government service and governance as it creates a partnership between private and public sector. With the rapid pace of technology development and the obligation of government to spend taxpayer’s money strategically, privatizing government services has gained unstoppable momentum.