News & Insights  |  Alerts

DOD Guidelines Highlight Strategies to Create and Maintain a Competitive Environment, Including Heightened Focus on Data Deliverables and Government Data Rights

August 26, 2014

On August 22, 2014, Frank Kendall, the Under Secretary of Defense for Acquisition, Technology and Logistics (AT&L) released Guidelines for Creating and Maintaining a Competitive Environment for Supplies and Services in the Department of Defense, which are "intended to complement and work in concert with" Better Buying Power 2.0 (BBP 2.0) initiatives focused on promoting effective competition.  The Guidelines identify ten "self-imposed impediments" that limit the U.S. Department of Defense’s (DOD) opportunities to realize the full benefits of competition and highlights eight areas that deserve increased attention by DOD acquisition professionals to create and maintain a competitive environment.

The guidelines are not prescriptive.  Rather, according to Mr. Kendall, they are “intended to provoke thought about the various approaches that may be used to competitively fulfill DOD requirements. The techniques and examples should be considered in developing acquisition strategies to tailor an approach that creates and maintains a competitive environment throughout the life cycle of a given product or service.”  DOD plans to publish the "DOD Competition Handbook, A Practical Guide for Program Managers" in September 2014 that will update and expound upon the Defense Systems Management College handbook published in 1984 for program managers, “Establishing Competitive Production Sources,” and will include case studies and examples that address all phases of the weapon system life cycle.

Among the highlighted areas for DOD focus are the increased use of Open Systems Architecture (OSA) to prevent “vendor lock” by “incentivizing prime contractors” to use OSA in the design phase so that functional modules or components can be competitively acquired from alternative sources, and better intellectual property (IP) strategies to enable future competition.  The Guidelines stresses the importance of developing an IP strategy that accounts for future competitive sustainment activities by ensuring that solicitations address both data deliverables (technical data and computer software) and the government’s rights in technical data and computer software.  It encourages the use of priced contract options for specific types of technical data and computer software, or for additional government data rights than what would otherwise be granted by the standard data rights clauses, and the use of appropriate factors or subfactors to evaluate offers of data deliverables and the associated data rights in source selections.  The Guidelines cautions, however, that DOD should not make an “unnecessary ‘grab’” for contractor proprietary rights, and should avoid requiring an offeror to grant the government additional data rights beyond the standard rights specified in the DFARS clauses as a condition of being responsive to a solicitation (which, although not noted, is a violation of 10 U.S.C. § 2320(a)(2)(F)).

Thus, the trend toward expanded data deliverables and government rights continues.  Contractors need to remain vigilant in understanding these heightened demands and the steps that can be taken to ensure their IP rights enjoy maximum protection.