MEMORANDUM

U.S. Department of Transportation
Office of the Secretary of Transportation

August 25, 1997

SUBJECT: Department of Transportation (DOT) Acquisition Incentive Awards

(original signed by)
FROM: Mortimer Downey
The Deputy Secretary

TO: Secretary's Management Council Members

The Federal Acquisition Streamlining Act (FASA) of 1994 envisions a Federal procurement system that is results oriented. To that end, last year DOT established a Procurement Performance Measurement Plan. The plan included both a set of DOT-wide performance measures and a set of performance measures for each operating administration (OA). Each OA should be in the process of updating that plan for Fiscal Year 1998 as well as assessing their results from the past year.

As a major component of the transformation to a results-based procurement system, FASA also called for the establishment of an "enhanced system of performance incentives" for procurement officials. The purpose of these incentives is to link the performance of our acquisition work force to measurable achievements. As Chairperson of the President's Management Council Procurement Task Force, I have asked each agency to consider establishing an appropriate results-based awards program (see attached memorandum).

Therefore, I am pleased to initiate the DOT Acquisition Incentive Awards Program. This is a significant way in which the acquisition work force can be encouraged and rewarded for efficient accomplishment of organizational goals and strategies. The critical element of this program is that it will be based on tangible results achieved, not just general excellence.

Each operating administration will develop its own nomination process and may select an awardee where appropriate. We suggest awardees be selected in the first quarter of the new fiscal year so the Department can hold a recognition ceremony before the end of the calendar year. We recommend that either you, your Head of Contracting Activity, or someone at a comparable organizational level be the selecting official.

The three basic selection criteria for the award are:

• The effort must have measurable results; e.g., cost savings, reduced cycle time, measurable improved quality, etc.;
  
• The effort must be accomplished by a "team." This team may consist of technical or program office, procurement, legal, financial, logistical, or other acquisition personnel; and
  
• The effort should reflect excellence and/or innovation.
  

One way to ensure that the award is based on measurable results is to use the procurement performance measures you have established as a guideline. For example, if your performance measures show you have achieved a significant reduction in cycle time or that you realized considerable savings by buying commercial items, then you might choose to recognize a team that was most instrumental in achieving those results.

We will be providing a more detailed description for each of the basic criteria plus a sample nomination format to your staff within the next month.

Each OA will be expected to fund their individual awards. It is not mandatory that each OA have an awardee, but each OA must have a process in place to evaluate nominations for an award. The monetary award should be substantial and proportional to the effort and number of team members. You may also incorporate this award into an existing awards program structure as long as it meets the criteria described above.

We thank you for giving this award your attention. If you have any questions about this, please contact Barbara Fallat at (202) 366-4974 or e-mail at (barbara.fallat@ost.dot.gov).

Attachment

cc: Procurement Management Council Members
Heads of Contracting Activity