DODI 5000.74 Enclosure 5: Services Acquisitions Requirements Development, Validation, and Oversight

1. GENERAL

Defining requirements is a challenging but essential prerequisite in achieving desired services acquisition outcomes. This enclosure establishes an SRRB process for developing, analyzing, reviewing, and validating requirements for the acquisition of services, pursuant to section 2330 of Reference (h).

2. SERVICES ACQUISITION MANAGEMENT OVERSIGHT

a. All DoD services acquisitions are categorized into five categories (S-CATs I through V, Table 1). These services are categorized based on total estimated dollar value (base plus option years) in current-year dollars from the IGCE. The S-CATs then identify a decision authority for that category and whether the authority is delegable. (See Table 1 for S-CAT thresholds.)

b. The decision authority or designee listed in Table 1 will be responsible for the review and approval of the acquisition strategy, as well as for the effectiveness of the services acquisition process by ensuring all required reviews are conducted (e.g., OSD, Component).

c. A requirements development and review process informed by current and accurate mission needs, cost analysis for anticipated quality levels, and market research, is critical to the final cost, schedule, and performance of the service. To facilitate this review, an SRRB process will be used for services acquisition at or above $10 million annually. The SRRB should review, validate, prioritize, and approve services requirements to accurately inform the budget and acquisition processes. Requirements approval should be obtained from the assigned SRRB chair before the initiation of any acquisition action unless otherwise directed by the decision authority. Requirements validation is not necessary for exercising contract options that were previously considered and approved by the SRRB.

d. DoD Components should have similar procedures established for requirements review, validation, and approval processes for acquisitions of services with an estimated total value at or above the SAT, but less than $10 million.

3. SRRB PROCESS

Requirements must be validated by the appropriate requiring activity authority as SRRB chair, often, but not always, the customer (in accordance with DoD Component procedures), before the approval of the acquisition strategy. The seniority of the SRRB authority will be commensurate with the complexity, contract value, and performance risk associated with the services requirement. The SRRB will:

a. Increase visibility of, and collaboration on, services requirements among all stakeholders.

b. Validate requirements before a contract is awarded.

c. Provide for prioritization of services requirements to support funding decisions.

d. Increase collaboration among stakeholders on key strategy decisions to optimize services acquisitions and enable efficiencies.

e. Foster proactive management by the Components for services acquisitions.

4. SRRB CONSIDERATIONS

a. SRRBs provide a process for assessing, reviewing, and validating services requirements by senior leaders. Requirements reviews should include (with appropriate tailoring), but not be limited to:

(1) Mission Need. Explanation of the mission need for the requirement and the outcomes to be achieved from acquiring services.

(2) Workforce Analysis. How the requirement is being and was previously satisfied, including why it cannot be fulfilled with military or civilian personnel. Coordination with the Component Manpower and Personnel officials should be done in accordance with DODD 1100.4 (Reference (o)). The analysis should also take into consideration guidance outlined in Reference (j) and DoDI 7041.04 (Reference (p)).

(3) Strategic Alignment. How the requirement for services supports the broader organizational mission.

(4) Relationship to Other Requirements. How the requirement for services impacts other requirements of the Component (positively or negatively). For IT services, see Enclosure 7 to ensure requirements are consistent with enterprise IT strategies.

(5) Prioritization. A determination as to whether the requirement for services is a lower priority requirement that can be reduced or eliminated with savings transferred to higher priority objectives or mission requirements.

(6) Market Research. The nature and extent of market research conducted, including any applicable benefit analysis performed for bundling or consolidation.

b. Requirements approval should be obtained from the SRRB chair before any acquisition action is initiated, unless directed otherwise by the decision authority. SRRB approval will be documented in the acquisition plan.

5. MFTs

a. The officials responsible for ensuring the fulfillment of the service contracts requirements are critical participants. Acquisition officials must engage with these officials early in the MFT formation process to ensure that the MFT supporting the requirement has sufficient training to execute the services acquisition.

b. The MFT assembled to develop the requirements should be comprised of individuals with various critical functional skills, and may be unique to an acquisition. The PM or FSM assigned to that service requirement will lead the MFT. The MFT will include a member with personnel and manpower responsibilities.

c. The project leadership should leverage the tools and checklists outlined in Figure 1 (Step 4, Requirements Definition) and the ARRT provided under the Service Acquisition Mall tab at http://sam.dau.mil. These tools should be used to the maximum extent practical for the development of performance-based requirements following the Requirements Roadmap process.

d. MFTs that support acquisition of services contract requirements valued at $1 billion or more will participate in a services acquisition workshop (SAW) or a program conducted using certified SAW facilitators and approved by the Director, DPAP, before seeking acquisition strategy approval. Waivers for participating in an SAW must be approved by the Director, DPAP. Senior officials are strongly recommended to consider applying the requirement for SAWs to services acquisitions valued at $100 million or more.

6. SUBMISSION OF ACQUISITION STRATEGIES TO OSD FOR REVIEW AND APPROVAL

The senior official of the organization concerned must, before the final solicitation is issued (or, for other than full and open competition, before negotiations begin), submit to the Director, DPAP, the acquisition strategy document for any proposed acquisition of services for which the USD(AT&L) or designee is the decision authority.

a. The USD(AT&L) or designee will review the proposed acquisition strategy document within 30 days after receipt. The review criteria and tenets are addressed in subpart 237.102-76 of Reference (g).

b. Issues arising from the review must be resolved in accordance with procedures specified by the USD(AT&L) in direct coordination with the originating senior official.

c. After completion of the review and resolution of any issues, the result will be either approval or disapproval of the acquisition strategy.

d. The review and approval process for the acquisition strategy will precede the peer review of the request for proposal in accordance with paragraph 7a of this enclosure.

7. PEER REVIEWS

a. In accordance with subpart 201.170 of Reference (g), the Director, DPAP, will conduct peer reviews for all service acquisitions with an estimated value of $1 billion or more (including options) or $500 million for non-competitive acquisitions. The Office of the Director, DPAP, will organize teams of reviewers and facilitate peer reviews for solicitations and awards.

b. DoD Components Acquisition Executives will establish their own procedures to conduct peer reviews for contracts valued at less than $1 billion.

8. IT SERVICES. For IT services, use the guidance provided in Enclosure 7.

9. PERFORMANCE MANAGEMENT

a. DoD Components will employ performance management metrics and tripwires to the maximum extent practical to signal areas of potential risk (e.g., performance, cost, schedule, fraud) to the DoD. Performance metrics or tripwires are not intended to restrict execution, but instead to alert and require higher-level awareness and action to remedy potential cost, schedule, or performance issues.

b. Specific metrics and tripwires can be tailored to the specific needs of the government customer for the service and the requirement. However, the metrics or tripwires must track and measure performance effectively, support and inform acquisition planning for new contracts, contract renewals, and contract re-competes, and be considered during the SRRB review and approval process.