Capitalizing on commercial-item designation provisions of FAR 13.5: getting the most from limited resources

• Main Authors: Johnson, Jason M., Ziegler, Mark A., Simonson, Brian K.
• Other Authors: Yoder, E. Cory
• Published: Monterey, California. Naval Postgraduate School 2012
• Online Access: http://hdl.handle.net/10945/10078

MBA Professional Report === The past decade has seen a significant change in business practices within the Federal contracting arena. Acquisition reform initiatives have fundamentally transformed the protocols and processes the Federal Government utilizes to procure billions of dollars' worth of goods and services every year. Reforms provided under the Federal Acquisition Streamlining Act (FASA), the Federal Acquisition Reform Act (FARA), and the Services Acquisition Reform Act (SARA), along with ensuing regulatory provisions in the Federal Acquisition Regulation (FAR), have created a more business-to-business-like contracting methodology. One such methodology is the FAR 13.5 Test Program for Commercial Items. FAR 13.5 allows the utilization of Simplified Acquisition Procedures (SAP) for all commercial-item designated goods and services up to and including $5 .5 million. The FAR 13.5 provisions are aimed at improving the efficiency and effectiveness of Federal contracting processes. The FAR 13.5 regulatory provision has tremendous potential to alleviate field contracting activities' work-in-process backlogs, improve cycle-time, reduce transaction costs, and increase customer satisfaction in the business processes designed to provide essential goods and services. However, based on the researcher's review of the business decision protocol at the Fleet and Industrial Supply Center San Diego, this text asserts Navy contracting activities may not be effectively utilizing the legislative and regulatory authority under FAR 13.5 to garner desired efficiencies and effectiveness. Therefore, the objective of this MBA research project is to determine the extent to which the Navy's FISC (Fleet and Industrial Supply Center) activities are capitalizing on the legislative provisions and regulatory provisions of FAR 13.5 and to make specific recommendations for improving the full utilization of the FAR 13.5 commercial-item designation provisions. This sponsored research study: 1) provides an overview of the applicable legislative and regulatory provisions, specifically FAR 13.5, and urges full utilization of the FAR 13.5 provisions, 2) investigates current business practices within the Fleet and Industrial Supply Centers (FISC) related to the FAR 13.5 regulatory provisions, 3) determines the extent to which FISC is reporting FAR 13.5 utilization and the degree of effective and efficient utilization of the FAR 13.5 provision, and 4) provides research conclusions and specific recommendations for better utilization of the FAR 13.5 provisions designed to benefit all process-protocol stakeholders, including the FISCs, their supported customers, the Navy and, ultimately, the American taxpayers.