By Erik Kleinsmith, Staff, Intelligence Studies, American Military University
Like the military and many other highly technical professions, the world of intelligence loves acronyms. We use acronyms to the point that they become words themselves. We even take acronyms and embed them into other acronyms. We love them because they help simplify our day to day communications between those who understand their meaning. To those outside of the intelligence community, it can appear as if we’re speaking a different language altogether.
One acronym that is almost uniformly misunderstood and yet hated in the intelligence community is LPTA. Indeed the mention of it evokes emotions of frustration and disgust from both government managers and contractors who understand what it means, albeit for different reasons. Those seeking an intelligence career need to understand what LPTA means and why to be very very wary of it.
LPTA stands for Lowest Price Technically Acceptable. It is a criterion the government uses for selecting contracts for both equipment and services. Federal Acquisition Regulation (FAR) 15-101.2 states that LPTA competitions are “appropriate when best value is expected to result from selection of the technically acceptable proposal with the lowest evaluated price.” When a contract to provide intelligence analysts to work for a particular agency is solicited by the government as an LPTA opportunity, companies that want to win this work must show in their proposal that they can meet the minimum standards for quality and expertise. They must then show that they can do this work at the lowest price among competitors who can also meet the same standards.
On paper, LPTA solicitations sound great. The government is getting the best value by awarding contracts to the lowest-price bidder who meets the technical requirements of the work. LPTA works well when the government clearly lays out the technical and personnel requirements of a program and there is little risk in quality with the lowest price offeror.
Unfortunately, the business of intelligence is primarily about people and it’s the quality of people that matters, especially when it’s related to our national security. Intelligence contracts that use LPTA with loosely written technical requirements quickly become lowest-price shoot-outs virtually absent of quality. As long as a bidding company can demonstrate it can meet the minimum technical requirements in its proposal (e.g., provide quality personnel, deliver products on schedule, etc.), the only thing left to compare to other bidders is price. As a result, the winner of the work is the one who has the lowest price. That is often detached from reality.
This is also known as “diving for the basement” among competitors. Capture managers (i.e. those in the corporate world looking to win new business) will end up sacrificing profit and salaries of their people in order to be the lowest. To paraphrase more than one capture manager I knew, “I would rather win the work and let the program manager worry about how to fill the low-salary positions than not win the work at all.” While a win is a win in the corporate world, program managers, hiring managers, and even government supervisors who actually have to work in this environment also have to deal with several unintended consequences of LPTA programs. Among the most significant are the following:
LPTA bids are stacked against incumbents. Quite simply, contractors who have people working on a LPTA-bid program coming up for re-compete have to bid with real people while competitors can bid fiction. As long as competitors can prove that they will provide intelligence analysts who will meet the baseline qualifications, it is easier for them to bid much lower and worry about the costs of actually hiring qualified people later. Incumbents are therefore faced with three choices:
- Bid their current people (and most likely lose)
- Bid their current people but cut their salaries (often drastically) and risk losing them, or
- Replace their current people and risk losing the relationships they’ve built with the government.
Options 2 and 3 require a certain degree of cut-throat mentality, as they entail telling current employees that their past efforts have been so great that they’ve resulted in a severe pay cut or outright replacement.
LPTA competitions create immediate turmoil and turnover. Once a competitive contract has been awarded, the winner with the lowest price has to actually fill the positions. If they are incumbents they have to follow one of the options they’ve chosen above. New companies have to bring in their own people. An oft-used tactic for new winners is to approach the incumbent employees whose company has lost and offer them their same jobs with the new employer – often with a 10 to 50 percent pay cut. To the individual employee this is a devastating turn. They either must quit immediately or keep their suddenly lower paying job. Because a large number of incumbent employees cannot afford the pay cut, the turnover on personnel immediately brings a level of turmoil to the program’s operations.
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Turnover turns into persistent attrition of analysts. Unlike programs where turnover happens because of the government selecting better quality people, the normal chaos that results in contract turnover is not a one-time event for LPTAs. It continues throughout the life of the program. Many incumbent employees who do not have immediate job prospects elsewhere will stay on – but only as long as it takes for them to find a better paying job elsewhere. New analysts starting on the program soon learn that they are worth more working somewhere else and also tend to leave in fairly short order. If there is a certification, clearance, or some other skillset acquired on the new job, they will wait until they gain it and then take their more marketable resume somewhere else in the community.
“Well, we got what we paid for.” So who takes the jobs on LPTA-bid programs? Often those just starting in their intelligence career with little experience, those waiting on a certification or higher clearance, or people with some other personal situation that prevents them from jumping. Many positions simply go unfilled. Government agencies that embrace LPTA competitions for intel services contracts should realize that their agency is part of the huge intelligence market economy and is therefore subject to market economy rules. If analysts don’t like the pay in an organization, they’ll vote with their feet to a better paying one. Once word gets out that an agency is contracting on the cheap, it will be harder and harder for it to attract quality personnel. With an unemployment rate for qualified, cleared intelligence analysts at perennially low levels, those who pay the least get the least. Similar to the contracting side, LPTA programs within the government are mandated by upper leadership and their contracting office, with the first-line supervisors and middle managers left to deal with the consequences.
We’ve saved millions of dollars. National security? What’s that? Besides the above challenges, the end result of LPTA programs with poorly defined technical requirements is that they suffer in quality, sometimes drastically. While this may be fine for contracts where quality is pretty standard or not important, for contracting people to support intelligence operations quality is everything. Our families go to sleep at night thinking that America’s best and brightest are watching the skies, monitoring our networks, and tracking down the bad guys. The reality is that we’ve often gone with the cheapest, not the best.
The intelligence community often draws people from the military, colleges, and law enforcement and information technology arenas seeking an intelligence career. If you are looking for a new intelligence career or looking for a change from your old intelligence job, be very wary of LPTA-bid programs.
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When considering an intelligence career, ask specific questions from your hiring managers and don’t take “It’s a best-value program” for an answer. Ask them about the average turnover rate and talk to other analysts currently on task if possible. Also ask them if there are specific resume submission or experience requirements for your position. If not, be warned. Eventually you will run into an LPTA-bid program, but hopefully from a third-person and not a first-person perspective.
About the Author: Erik Kleinsmith is the Associate Vice President for Strategic Relationships in Intelligence, National & Homeland Security, and Cyber for American Military University. He is a former Army Intelligence Officer and the former portfolio manager for Intelligence & Security Training at Lockheed Martin. Erik is one of the subjects of a book entitled The Watchers by Shane Harris, which covered his work on a program called Able Danger tracking Al Qaeda prior to 9/11. He currently resides in Virginia with his wife and two children.