DoD seeks to cut costs without affecting contractors

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New Department of Defense contracting guidelines seek to cut department costs while maintaining profit for defense companies.

But can both be done at the same time?

The guidelines are supposed to improve management, while giving defense companies incentives to lower production costs.

The idea is to cut unnecessary expenses, say DoD officials.

“With incentives, profitability and productivity can go together,” Defense Department Acquisitions Chief Ashton Carton said in an interview with FederalTimes.com. “If you squeeze unnecessary costs, DoD gets a better price, and they get a better profit.”

Contractors aren’t convinced.

“Industry has a lot of concerns about how this will be implemented,” said Ric Sylvester, vice president of the Aerospace Industries Association. “That includes profitability.”

The new purchasing guidelines are part of a Pentagon-wide effort to cut its budget while maintaining the ability to fight wars and create weapons systems.

Under the guidelines, program DOD managers must give as much weight to affordability as they do performance attributes.

Fixed-price incentive fee contracts will adjust their share lines under the new plans. Simply put, the government and industry will share equally in any cost overruns and will also share equally when a project comes in under budget.

Pentagon officials will be encouraged to move portions of larger programs that primary contractors are not performing efficiently and give them more focused attention — which might create more contracting opportunities for smaller companies.

Nominations sought for Symposium awards

The Space Foundation is looking for a few good people — those who have had a lasting effect on the space industry.

The foundation will honor three people during its 27th annual National Space Symposium, scheduled for April 11-14 at The Broadmoor.

The foundation, based in Colorado Springs, annually recognizes outstanding accomplishments in three categories: space exploration, creating a positive public environment for space and space achievement.

The John L. “Jack” Swigert Jr. Award is given for extraordinary accomplishment in space exploration. To be eligible, the nominee must have either accomplished or completed the activity during the 2009-2010 timeframe. The award was created to honor Swigert, a Colorado native who served on the Apollo 13 lunar mission.

The Douglas S. Morrow Public Outreach Award is named after the Academy Award-winning writer and producer, space advocate and former Space Foundation board member.

The award recognizes an individual that has created a positive public environment for space and increased understanding, awareness and interest in space to a significant segment of the general population.

Finally, the Space Achievement Award is presented for significant contributions in advancing the development or use of space. To be eligible, the nominee must have made a major contribution to space, such as releasing a new technology, significantly improving performance or capabilities of an existing technology, creating new opportunities for space employment.

Nominations should be sent to awards@spacefoundation.org. The deadline is Oct. 31.

Alliance sponsors Conference

The Rocky Mountain Technology Alliance will be hosting the 2010 High Altitude and Near Space Conference Sept. 28-30 at the Crowne Plaza Hotel.

The conference provides a forum for the presentation and perpetuation of near-space technology development, policy and commercialization. The goal is to assist organizations that will add to the nation’s economic growth and technical independence.

SpaceData Corp. will have an onsite launch and communications demonstration at the event.

There will be four panel discussions: defense and security; commercial near space services, near space technology and policy presentations.

Speakers include representatives from NASA, private industry and the military.

For more information, visit www.rmtech.org/haans.

Amy Gillentine can be reached at amy.gillentine@csbj.com or 719-329-5205. Friend her on Facebook.