Government and Contractors’ True Perceptions About LPTA Contracts - (Archived)

Lowest Price Technically Acceptable (LPTA) procurements have been a hot topic in the federal government contracting industry for the past two years. Contractors worry that LPTA will lead to contracts being awarded to less qualified companies and sacrifice long-term value for short-term cost savings, lowering the standard of performance in the industry.

While LPTA opportunities help to control costs and provide an economical approach for product and commodity procurements, contractors are concerned about whether the government will truly receive the best value and quality under these kinds of contracts.

Many argue that the LPTA process can drive the government to make “vanilla” rather than “innovative” choices. As the government increasingly relies on industry to drive change and implement new technologies in government, contractors worry that LPTA is stifling innovation and the ability to propose out-of-the-box solutions that will ultimately make government more efficient and effective.

As Barbara Duncombe and Joshua Prentice of Taft, Stettinius & Hollister, LLP pointed out in their recent guest column in the Washington Business Journal, does it make sense for government agencies to use LPTA across the board, from buying pencils to highly technical services, and everything in-between? What used to be Best Value contracts could now be more geared toward LPTA and it is important to know the difference when drafting a proposal.

In July 2013, Market Connections, Inc. conducted an online survey of 360 federal government decision makers involved in selection of contractors and vendors in some way, and 375 government contractor employees regarding their experience with and perceptions of LPTA federal procurements. Market Connections will release the results of that survey at an industry breakfast event this Thursday, October 24 in McLean, Va.

In these austere times, LPTA will continue to be a main driver for reducing costs. Contractors and government executives expect that the use of LPTA will either increase or stay the same in the next three years. As with any shifting marketplace, contractors must continue to make changes to the way they do business in order to keep up with the times. A panel discussion including business leaders from contractors GDIT, Harris IT and Sotera Defense Solutions will discuss how businesses are responding to LPTA via operational strategies and business capture tactics. Additionally, the executive director of National Contract Management Association (NCMA), Michael Fischetti, will share his perspective as a former procurement officer and a representative of both government procurement professionals and government contractors in his current role.

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