a. The Department of Defense (DoD) relies heavily on private
industry to provide the systems and services that make our military the best
in the world.
DoD relies on private industry to provide leading-edge technologies at an
affordable cost through-out a system's life cycle. Consequently, DoD's
suppliers must be innovative, efficient, and effective. Lean industry
principles and best practices should be recognized and rewarded.
b. Traditional acquisition concepts and incentive strategies
require adaptation to the new business environment.
The content and character of the government-contractor relationship has
evolved into a relationship that is characterized as problematic and
adversarial. Not unexpectedly, there often are disconnects between the
contractual incentives to achieve desired government-structured performance
and the motivational factors driving the contractor.
c. Properly structured contractual incentives, as part of the
overall business relationship, can maximize value for all parties.
Contractual incentives should target the business relationship between the
government and the contractor in such a way as to produce maximum value for
taxpayers, for the contractor, for the warfighter, and for the organization in
pursuit of its mission. The workforce must not only improve its ability to use
existing contractual incentives but also to develop a range of new and
innovative contractual incentives.