It is crucial for small businesses to educate themselves about a topic before they develop a business strategy. Learning the rules and regulations is just a tiny part of this process. The Federal Acquisition Regulation otherwise known as the FAR is the government’s bible. Federal agencies and small businesses awarded contracts must follow the procurement rules and policies set forth within the FAR. One of the items contained within the FAR is called the Past Performance Questionnaire otherwise known as PPQ.
This Questionnaire became necessary because Congress has determined that it is appropriate and relevant for the Government to consider a contractor’s past performance in evaluating whether that contractor should receive future work. In other words, a contractor’s past performance is a good indication of its future performance.
Why evaluate past performance?
The main reason to review a contractor’s past performance is for determining whether a small business completed the contract and met the needs of the government. Did the contractor have any obstacles to overcome when concluding the contract? Was the contract completed on time and within the budget? How well did the business communicate with the government during the contract period? By reviewing all these things, the government can rate how likely the contractor will perform on future contracts. You, as a small business, must define and develop a business strategy that allows you to capitalize on your performance of these contracts.
When does the government evaluate a contractor’s past performance?
The government will evaluate past performance in all competitively negotiated contracts that exceed the simplified acquisition threshold ($250,000 and above). If the contracting officer can document why past performance is not an appropriate evaluation factor, then the past performance questionnaire is not required.
As you can tell the government is very much interested in how well you have performed in the past. They will break down your performance into sections such as technical performance, cost control, timeliness, and how well you communicated with the government and subcontractors. The Government will provide ratings to businesses that perform contracts. The ratings go from “Exceptional” being the highest, to “Unsatisfactory,” at the lowest. These scores are used to gauge the risk of working with you.
Which Contractor Would You Choose?
Consider the following example. Two contractors bid on a project. Company A’s bid was $300,000, and Company B’s bid was $300,500. If we were only evaluating price, then Company A would receive the contract. However, we all know that the government has to consider past performance when assessing contracts above the simplified acquisition threshold. Since the contracting officer knew that the award amount was going to be above the simplified acquisition threshold, we must now add these factors to the contract before we can award it. Let’s assume that Company’s A past performance score was “Unsatisfactory” and Company B’s score was “Exceptional.” Now, who would get the contract? Company B of course.
So, what happens when each competitor’s Past Performance rating is too close to call? The Past Performance Question is used to determine which contractor’s performance is better on a particular solicitation. Your score is equivalent to your grade in a class, and the questionnaire is your teacher’s notes.
What does the Past Performance Questionnaire ask?
That depends on the agency’s specific Past Performance Questionnaire. It could be “essay” style questions or just checkboxes. Want to see some samples? Do an Internet search and look them. See what questions they are asking. Every agency has a different Past Performance Questionnaire. Besides that, contracting officials can develop the questionnaire based upon a specific requirement.
Who collects the Past Performance Questionnaire?
That depends on the instructions in the solicitation. Sometimes the contractor will collect the PPQ, or the agency will request that the PPQ sent to them. Just follow the instructions that are given.
The Catch?
The contracting officer is under no legal obligation to fill out your Past Performance Questionnaire. The FAR does not state that the contracting officer has to do it. This can be a “Catch 22”. Now is the time to consider a business strategy to limit the chances of not getting a completed past performance questionnaire from a government official.
What Can You Do?
Start keeping track of contracting officers’ names, email addresses, and phone numbers. Call the contracting officers and let them know that you are sending a PPQ to them. Remember to include the response date. Give that contracting officer as much notice as possible. Are you currently working on a contract and everything is going well? This is the time to ask the contracting officer if you can use them as a reference.
You can avoid the problem by developing your own database of contacts. We all realize that this is unfair for you to lose a contract for something beyond your control. You need to develop a successful business strategy to minimize this risk.
Want to Increase Your Rating?
All businesses should be looking for ways to increase their ratings. What steps does your business need to take to become an exceptional contractor? Can you implement systems to streamline the process? Spending the time now and develop a business strategy that encompasses these things will make you an outstanding contractor.
Be sure to read other articles about government contracting at byerlyenterprises.com/blog.