Meeting with friends of your boss can be a procurement problem

Dear Frank,

Prison? Whoa! I hadn’t really considered that possibility simply because of an error in judgment or transgressing a little known regulation. Can you tell me more about this? What do I need to know to be sure that I remain within the ethical lines?

There’s more in your letter I want to discuss, but for now, this is troubling me. Please tell me more.

Nervously,

Fernando

Meeting with friends of your boss

Fernando, while I’m writing, I’ve had some further thoughts about things you’ll encounter on the job, things you might not think about until it’s too late.

One common situation in a government job occurs when your boss asks you to meet with a friend, from pre-government days. The friend often just happens to be a contractor.

Be careful, because this can present an ethical problem, especially if your boss is planning to award a small consulting contract, possibly to his friend. On the other hand, your boss may simply want you to meet with the old friend as a courtesy, with no intention of awarding the friend a contract. You cannot be sure what the game plan is or whether there is a game plan at all.

Your boss has put you on a tightrope, probably without realizing it. You have to step carefully, because you can trip into one of two unfortunate outcomes:

• You can go to prison. Yes, it’s true. While procurement rules do allow awarding some small contracts without competition, they do not allow awards based on friendship. If you violate the rules or even appear to, there’s a very real risk you could be in legal trouble.
• You could alienate your boss. This is less dire than prison, but it can still damage your government career, especially if your boss is not inclined to be reasonable.

You must respond to your boss’ request but do it in a way without risking censure, and do it in a way without offending your boss.

The first thing to do is to schedule a meeting with the friend. Do it as soon as possible to be responsive. Give the friend the same information you would give to any contractor, nothing more. Suggest other people the contractor might want to call on and make it clear why you are making the suggestion. Tell your boss the meeting went well, assuming it did. If the friend asks for a second meeting, pass him along to one of your division chiefs. With a little effort and some smooth human relations, you will never need to meet again and expose yourself to trouble.

For major contracts, the stakes are higher. For example, in 2008, 270 vendors attended an industry day to learn about the General Services Administration’s planned procurement of $400 million of computer services support.

In procurements of this size, the pressure can be intense for vendors. A win can make a company healthy for several years. It’s especially important to struggling companies. If a company’s stock price is low and their revenue stream is weak, winning a major procurement can put cash in their coffers and restore Wall Street’s confidence.

If your boss asks you to meet with an official of a company bidding or planning to bid on a contract your agency is awarding, beware. The difference between this situation and the other meeting when you could not be sure a small contract award to a friend is the goal, in this case you know a contract is the goal and a large amount of money is involved which changes the ball game and raises the personal risk

Little is secret in major procurements. A company’s competitors and all of your colleagues and subordinates in the agency are watching. Any meetings should include all prospective bidders. Otherwise, there will be protests after award. Even worse, if you accept lunches or other gifts from bidding vendors, jail is a possibility. Courtside seats at a Washington Wizards basketball game aren’t worth time in a cell.

The government procurement system can protect you. The general procedure is for the government to quit all contact with bidding companies at some point in the process, except for the procurement officials directly involved in awarding the contract. The question is, just where in the process will the cutoff occur because it can vary. Sometimes the government will shut down further conversations and contacts after the procurement office issues the Request for Quotes (RFQ), but it can close the door at any point in the long contracting process.

The RFQ process will show which companies are interested in the procurement, and it can show the range of prices the government can expect when it issues the final Request for Proposals (RFP) to industry. After the government receives responses to the RFQs, it can then open up formal bidding. By then, all contact between government and industry will have ceased, protecting unwary government officials, including you, Fernando, from compromising situations.

Advice to Fernando. Let the “green go” light change to a yellow caution light when your new boss asks you to meet with a friend and you know the friend works for a company seeking business with the government. This predicament will test your skills but follow my advice and you can navigate through the dangerous waters. When you meet, bring a procurement officer with you to keep you off dangerous ground, if not bring another person to serve later as a witness if needed; and above all, accept no gifts of any kind.