More and more organizations are using the Task Order form of contract as a vehicle to procure services. It doesn’t matter whether your firm provides architectural services, engineering, software development, accounting, or general consulting services, the Task Order contract is here to stay. Sometimes it is called a Work Order, On-Call, or Indefinite Quantity (IDIQ) contract, but in essence, it performs the same function, and offers the following advantages to the client:
- It limits the funding obligation and expenditures until the actual task is performed.
- It increases the availability of funds.
- It allows for the letting of multiple task order contracts to several competitive firms for similar tasks and scopes of services.
- It expedites the procurement process by retaining under contract multiple firms. While some clients may procure by way of mini-proposals for each task order, smaller contracts in value can be awarded directly and expeditiously to the best qualified firm already under contract.
Firms initially compete for a Task Order contract similar to any major contract by way of a Request for Proposal (RFP) process. Sometimes a sample scope or typical project is provided in the solicitation. The client’s goal is to select several firms that can be available “on-call”, as needed. Established in advance are the firm’s hourly rates, sample resumes and resources that may be available for a future task, and most importantly to the client is obtaining the firm’s contractual agreement in advance, as well as other related legal, procedural and/or administrative documents.
Once a contract is awarded, let’s say to the XYZ Accounting firm with a value of one million dollars over three years, and the scope of services is to provide on-call financial audits of engineering projects, the client can then elect to issue its first task order to XYZ, providing a scope of services. XYZ must provide in return a min-proposal consisting of a schedule, the resumes of the professionals who will perform the work and a fixed price. The rates and skill sets were previously provided with the initial proposal along with the established and agreed-to contract.
There are numerous variations regarding the issuance of task orders, such as:
- Multiple firms may compete for the same task order.
- The mini-proposal may require that the competing firms provide an approach to the scope.
So you win a three-year task order contract for a million dollars. It sounds great, but you can’t spend the money, unless you get the client to issue the task orders. Here are ten ways.
1. Performance First. Maxing out a task order contract starts with quality and the successful performance of the prior task order(s). You will have a tough time getting more work, if the product is mediocre. Word gets around, especially if the client is unhappy. Many clients maintain an internal database of vendor performance. It is therefore important to know what that database says about your firm.
2. Find Related Work. Task order contracts are written for related work, so the client doesn’t have to formally solicit by way of an RFP every time a related service is needed. The key is for the firm holding a task order contract to anticipate in advance the related work needed by the client. It isn’t as hard as it seems. Simply ask the client, and help him write the scope of services. After all, you’re working with him/her every day.
3. Walk the Halls. Having a task order contract provides a golden opportunity to walk the halls of a client’s facilities seeking out opportunities. Even Informal discussions in the cafeteria or at the water cooler could present a problem to be solved. Following 911, today’s security procedures prevent people off the street from walking the halls. However, a task order contract provides access, even for your firm’s senior project management to get inside.
4. Vertical/Horizontal Exposure. A task order contract provides opportunity for gaining recognition within an organization. Most likely the client’s project manager, his boss, and his boss’ boss are aware of your contract and service being performed under a task order. But what about other contacts within the client’s organization horizontally aligned. For example if you working for the engineering organization, consider reaching out to the financial organization?
5. Marketing 1.1. Selling a second product or service to an existing customer, is a key component of marketing1.1. The advantage of this component is that there is no need to sell the client on the firm. Credibility has been established, especially after the delivery of a quality service. The client will therefore be more receptive to listening to an additional service that you can provide. A task order contract provides an excellent vehicle to sell an additional service and secure another task order.
6. Train Technical People. In the article, “It’s Not My Job”, I wrote about the importance of the technical professional to the business development process. Clearly under a task order contract the technical professional shines. If he/she has the where-with-all to expand the contract by obtaining additional assignments, the firm will significantly benefit with more new work. However, training is often necessary to make the technical professional aware of his vital business development role in a task order contract.
7. Meet With Senior Management. In any organization, senior management provides a broader perspective of the real needs. In essence they are the client, can make decisions and drive the task order process. Your meeting can reveal a sense of urgency and provide a heads up as to when the next task order may be issued. With good salesmanship, you are presented with an excellent opportunity to expand the contract and drive additional task orders.
8. Conduct Studies. Clients have many needs and problems that need to be solved. Task order contracts provide an excellent vehicle for conducting studies, and solving problems for clients. They also uncover future needs, provide a unique perspective and possibly a competitive advantage, and generate additional revenue. In order to create a need for a study, your staff must look for the opportunities.
9. Closely Track the Budget & Task Orders. As task order contracts get used, firms can sometimes lose track of the client expenditures to date vs. the value of the total contract. You don’t want to leave any excess money in the contract when it’s over. Close monitoring is required, and enough time should be allocated for the client to issue additional task orders before the contract is up. Use it or lose it.
10. Total Contract Value Can Be Exceeded. Though a task order contract may have a total value of “x” dollars over “y” years, depending upon the nature of the projects, performance, and other factors, the contract often has the potential of exceeding the dollar value and duration. A five year $ 5 million task order professional services contract that I sold to the U.S. General Services Administration, lasted over ten years and exceeded $12 million. A three year contract that I sold to a major Authority in the Northeast in 2003 is still on-going as of 2009. If the client is happy and doesn’t want to lose the support it’s receiving, in most cases, the client will not “rock the boat” and introduce new personnel or go through another re-orientation period.
In summary, we have provided ten proven ways to maximize a task order contract. There are others, and we welcome your comments.
ABOUT J.S. BARCLAY, PC
J.S. Barclay is a professional marketing consulting firm focused on enabling professional services firms to achieve their goals and objectives. Established in 2002 by the founder and President Joseph C. Hoffman, the firm has developed a track record of performance and excellence resulting in long term client engagements. Mr. Hoffman consummated billion dollar deals, and was the leading marketing executive for a well-known NYSE project management consulting firm prior to forming J.S. Barclay.
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