CHAPTER 3.Acquisition Planning

In Chapter 2 we defined the process by which supplies and services are procured and briefly discussed the six steps or phases in the government acquisition process, i.e., requirements determination, acquisition planning, negotiation, contract award, performance after contract award, and contract closeout. In this chapter we will discuss the requirements determination and procurement planning phases of the acquisition process.

The word requirement means “need,” not product or service type, which is a solution to a need. All procurements begin with the determination of need. The need is translated into products or services, which then direct us to potential suppliers and the cost of the solution. This chapter will emphasize the significant role market research plays in this process and the early identification and management of the risks and opportunities as a way to increase the probability of a successful procurement.

It is the policy of the federal government to use electronic commerce whenever practicable or cost-effective. For the micropurchaser, the use of electronic commerce (e-commerce) is introducing a more integrated contracting process. The use of EDI to transmit purchase orders means that they can potentially move between the buyer and seller without human review and processing. Therefore, the data pertaining to what is being purchased, including the item description, quantity, price, contractual terms, and authentication of acceptance, are electronically integrated. Efficiency will be added through the use of electronic catalogs (e-cats) that provide online access to commercial firms as well as government agencies (e.g., General Services Administration, Defense Logistics Agency). The use of e-cats speeds access to contract and supply schedule items and improves sourcing, pricing, and the ordering process. A detailed discussion of micropurchasing using e-commerce is beyond the scope of this book; therefore, this chapter will address the acquisition of goods and services in larger dollar categories.

Acquisition planning is more than just determining what to purchase and when. It addresses technical, business, management, and all other considerations that influence the acquisition decision, such as which items are to be developed or produced in-house and which procured from outside the immediate organization. Acquisition planning is designed to coordinate effectively the efforts of all personnel responsible for the multi-faceted aspects of procuring supplies and services.

A recent survey by the University of Houston concluded that the primary cause of program or contract failure is a lack of defining the program adequately at the beginning, i.e., inadequate definition of requirements. Planning for the acquisition begins as soon as the need is identified. As acquisition doctrine reminds us, the goal of each procurement is to deliver the best-value product to the ultimate user on a timely basis, while maintaining the public’s trust and fulfilling public policy objectives. The acquisition planning process demands teamwork. To be successful it requires all personnel involved in the acquisition to develop, coordinate, and integrate their body of knowledge into a comprehensive acquisition plan. Planning to acquire goods or services is an evolutionary process, beginning with the development of the mission needs statement and culminating in the solicitation. Procurement planning is a subset of the overall acquisition plan. The procurement plan should contain all applicable technical, contracting, fiscal, business, and program/project management factors that will govern the acquisition. The plan also must address potential problems, risks, and opportunities. The magnitude and detail contained in an acquisition plan should be tailored to fit the situation. For example, the detail of a plan to purchase supplies in economic quantities, covered in FAR 7.2, is significantly less than what is needed for more complex high-dollar items that will be procured via the competitive negotiation process.