In support of this strategy, the Office of Science and Technology Policy, in conjunction with the Small Business Administration, established the Innovation and Entrepreneurship Working Group. As a participating member of the SBIR Improvement sub-group, DARPA has brought to the forefront the issue of the difficult and lengthy contract negotiation and award process and has developed a Sample Agreement document under the Other Transactions (OTs) for Prototypes authority in an effort to streamline the process.
President Obama’s National Innovation Strategy, described in “A Strategy For American Innovation: Driving Towards Sustainable Growth And Quality Jobs” seeks to harness the inherent ingenuity of the American people and a dynamic private sector to ensure that the next expansion is more solid, broad-based, and more beneficial than previous ones. It focuses on critical areas where sensible, balanced government policies can lay the foundation for innovation that leads to quality jobs and shared prosperity. It has three goals: (1) Invest in the Building Blocks of American Innovation; (2) Promote Competitive Markets that Spur Productive Entrepreneurship; and (3) Catalyze Breakthroughs for National Priorities.
In support of this strategy, the Office of Science and Technology Policy, in conjunction with the Small Business Administration, established the Innovation and Entrepreneurship Working Group. As a participating member of the SBIR Improvement sub-group, DARPA has brought to the forefront the issue of the difficult and lengthy contract negotiation and award process and has developed a Sample Agreement document under the Other Transactions (OTs) for Prototypes authority in an effort to streamline the process. The use of OTs provides commercial companies an alternative to procurement contracts subject to the Federal Acquisition Regulation and allows these companies that traditionally have not done business with the Government to utilize commercial practices in their award negotiation.
Coined as the “1040-EZ” SBIR, this Sample OT is designed to:
- Simplify and standardize as much as possible
- Be concise and make the process more logical and easier to read and understand
- Cut negotiation and award timeframe to less than 60 days from time of selection to funding vs. the current average timeframe of 180 days
- DARPA “Beta test” for “1040-EZ”: the first OT took 37 business days
- Simplify government clause language, which sometimes deters small businesses from engaging in and pursuing Federal procurement contracts
- Reach out to groups of young entrepreneurs/non-traditional commercial companies that are not being targeted for Federal procurement contracts
Specific areas streamlined in negotiation process:
- Removed sections in the document where reference can instead be made to the Contractor’s proposal
- Moved sections that involve minimal negotiation to attachments section of the Sample OT document
- Moved definitions section to the attachments
- Moved standard operating procedures (e.g., payment procedures, reporting requirements, patent reporting) to attachments
- Streamlined language through a line by line simplification to reduce the text in the body of the OT to 10 pages
- Synchronized frequency of reporting requirements to minimize reporting
Lessons Learned – Contractor:
- Contractor needs to clearly identify delivery of a prototype directly related to weapons system in proposal
- To meet 60 day time frame, Contractor needs to provide an adequate proposal to conduct a price analysis – supporting cost details need to be provided within one week of Contracting Officer notification to Contractor
- Contractor needs to submit a Schedule of Milestones and Payments with realistically achievable milestones
Lessons Learned – Government:
- The Sample OT should reflect performer-oriented terminology
- The Government should make accessible a copy of the Sample OT in the solicitation that:
- Details expectations for completed milestones
- Details expectations for the cost proposal
- Government should note in solicitation that expeditious award is contingent upon a quick resolution of any issues with Sample OT