Conflict Resolution: Other Options

While we want to let you know about your right to dispute and appeal, we also want to make you aware that the government's stated policy is to try to resolve all contractual issues in controversy by mutual agreement at the contracting officer's level. Government rules state that reasonable efforts should be made to resolve controversies, prior to the submission of a claim. And where appropriate, agencies are encouraged to use ADR procedures to the maximum extent.

Traditionally, contracting parties have relied on claims and litigation to resolve disputes. In the interest of economy and efficiency and achieving a "win/win" situation for both agencies and contractors, less confrontational resolution procedures are being utilized more and more often. Communication and openness throughout the procurement process greatly reduce conflicts. The Office of Federal Procurement Policy has recognized the value of such procedures by including an agency commitment to institute an informal, timely conflict resolution mechanism for resolving pre- and post-award issues. Here are three techniques that are being used:

Partnering. This is a technique for preventing disputes from occurring. Under this concept, the agency and contractor, perhaps along with a facilitator, meet after a contract is awarded to discuss their mutual expectations. The parties mutually develop performance goals, identify potential sources of conflict, and establish cooperative ways to resolve any problems that may arise during contract performance.

Creating a partnership agreement signed by all parties (i.e., contracting officer, quality assurance evaluator, program office, and contractor) creates a "buy in" to the overall goal of satisfactory performance on time, within budget, and without claims.

Both contractors and contracting agencies, including DOD's Army Corps of Engineers, that have participated in partnering have experienced positive results: more timely performance, better cost control, significant reductions in paperwork, professional vs. adversarial relationship/attitude, and fewer disputes.

Ombudsman. This procedure can be used at any stage of the contracting process. Some agencies have established an ombudsman to help resolve concerns or disputes that arise during the acquisition process. Typically, an ombudsman investigates selected complaints and issues nonbinding reports, with recommendations addressing problems and future improvements.

The Army Materiel Command (AMC), including all of the subordinate AMC buying commands, has an agency ombudsman that helps companies resolve problems they encounter on existing AMC contracts. The ombudsman, which can cut through any government "red tape," investigates reported complaints or requests for assistance from business/industry and ensures that proper action is taken.

The AMC-wide ombudsman program has been a positive force in the timely resolution of problems presented by contractors. It results in the solution of most problems presented without the need for expensive and time-consuming litigation.

NASA also established an ombudsman program to improve communication between the agency and interested parties. The NASA ombudsman hears and works to resolve concerns from actual and potential offerors, as well as contractors, during the pre- and post-award acquisition phases.

Alternative Dispute Resolution (ADR). This means any procedure, or combination of procedures, used voluntarily to resolve controversies without resorting to litigation. Examples of ADR include conciliation, facilitation, mediation, and mini-trials.

ADR can provide an effective and less expensive method for resolving contract disputes, and many agencies include an agreement to utilize ADR in their contracts.

The Navy, which has used ADR techniques since 1982, has been able to resolve issues and controversies in almost 99 percent of the cases in which ADR was used. Recently, the Navy used ADR to resolve a $1.1 million dispute. The hearing on this matter was completed within six hours, and a decision was rendered the next day.

There is no single correct method for conducting ADR. Each situation is different, and the ADR technique and procedures must be tailored to a particular situation and the needs of the parties.