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PRE PRICE NEGOTIATION MEMORANDUM (PROCUREMENT) FOLLOW EVERYTHING IN THE TEMPLATE. USE THE CASE ASSIGNMENT TO GET THE INFORMATION. YOU MUST FIND OPTIMISTIC AND PESSIMISTIC TOTALS.,TOPIC: Final FOCUS on Production Pre-PNM 1. Write this from a perspective that I don?t know anything about your project but I am the one who has authority to authorize you to negotiate for the government. Remember, you are developing a pre-PNM in this exercise. After approval you enter into negotiations and hopefully end up in agreement. The final PNM will capture the position you and the contractor landed on as acceptable to both. The pre-PNM presents the ?how I think it could go? and then a final PNM will explain ?what happened?. 2. You have comments from DCAA and the technical folks that you need to weave into your pre-PNM position discussion and bounce this input against what the contractor proposed. You also need to weave into your pre-PNM what happened during the fact finding meeting as the contractor should not dispute in negotiations changes they already agreed to make. 3. From all this information you are going to develop three positions to present for approval. You don?t just present the numbers but explain why you have selected the number - what information supports the dollars for a given position for a given cost element. Here is a little more detail about each position: A. OPTIMISTIC: your best hope and the dream position to spend the least money for the project. No doubt if you could get everything you would negotiate to exclude anything questioned, anything not supported and anything for which DCAA recommends a lower cost and/or your technical folks suggest reducing in terms of labor or material they think could be achieved and the contractor still to reach the performance goal. B. TARGET: where you really expect to end up based not only on the input you have from DCAA and the technical folks and meetings with the contractor but also reality. With rare exceptions the Contracting Officer will use input from DCAA and their technical advisors as the foundation for their target position. If the contractor could provide support or explain their position where the costs were questions what would you be willing to negotiate? How would you reconciling their proposal if they could support and explain things that were unsupported or questioned with that input from the government team? C. PESSIMSITIC: worst case scenario and maximum amount of money for this work. This is the highest dollar value you are seeking approval to agree to so you can ?seal the deal?. Again, you will need to consider what to do with the questioned and unsupported costs as well as what to do with costs for which the contractor and the government advisors are not in agreement. You have to consider and explain what you would have to see to accept a higher cost position than recommended by your government team? How far from your target are you willing to go and still defend the cost as fair and reasonable? In some cases for a given cost element you might have the same value for all three positions if there is nothing in question and what is proposed is determined to be reasonable in terms of technical approach and in terms of the cost proposed. Sometimes you target and pessimistic for a given cost element could be the same or optimistic and target - get the idea? There is a degree of judgment that enters the realm of work ? this is part of the learning experience for this exercise. Two Contracting Officers will not come up with the same positions as they will weigh more heavily one aspect or another of the information they have been presented. Their evaluation forms the ?why? of the numbers proposed. 4. You have 90% of the information you need to complete this project in the case itself and most of what this exercise involves is pulling it together. The pieces you don?t have and need to develop are: a. Using regression analysis solve for the function point b. Coming up with a new G&A rate based on the consolidation of the two divisions, the discussion about what that means and how each contributes when the companies are combined. Look at the differences in the contribute of each to what will be the combined base and combined pool and taking into account the savings that would come out of the pool as identified by DCAA. 5. You should have narrative and lots of it. Even though you have a summary at the start of the pre-PNM you break down each element and talk about them. For example although you will present a summary position (optimistic, target and pessimistic) for material in the consolidated table, in the narrative section about material costs you will talk about each aspect of the material from group 66-9210 through 69-1110. 6. Remember, a PNM (pre or final) tells a story and should capture everything someone would need to know to agree that you have defended your negotiating position. Make sure you tell a story and don?t just provide a spreadsheet of numbers!,yes but I cannot extend it any longer than 30 hours. This assignment is extremely important. Therefore I must have it completed.,I thought u said u were half way done with it. What happened?,Why did u lead me to believe you knew how to do the assignment if u had no idea how to do it?


Paper#8625 | Written in 18-Jul-2015

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