The easier you make it for the CO to review and analyze the VECP, the better. Our systems take care of almost all issues, excluding the technical details, which you must supply.

Learning more about the process

Use the enhanced contractor system

Use the enhanced system. For next to nothing you can play with various scenarios, report on them, and review them. It walks you through the process and most people learn key issues just using it. The system cannot generate the technical issues for you, for hints on that, you probably need to look at taking one of our lesson plans.

What is the purpose of the date for response?

By regulation, the CO is expected to give a response within 45 days. The date shown is automitically set to that date. However, you may have shorter or longer time needs. Our system allows you to let the CO know. If you don't need the 45 days, it does not change the 45 response rule, but helps the CO help you.

Lessons

We also offer a lesson plan on the subject. It is an interactive 21 part lesson plan that can be done in the comfort of you home, or office.

Who can file a VECP?

The contract must allow a VECP

If the contract is a Federal or State contract over $100,000, you should examining your contract documents for potential the VE Incentive Clause. It is required to be present by law. Even if it is not present, it is as that is the requirement.

It must be for good and services

Unless the contract is for professional service (engineers, architects, chemist, etc.), it is considered a goods and services type contract.

Are their other requirements?

Of course. That is what our system does for you, It walks you through the steps, identifying issues, and "holding your hand" throughout. In the past, the contractor, and CO, often felt overwhelmed by the requirements. As a result, many didn't file the VECP. That fear lost them money. Our systems are designed by experts who are recognized and have been involved in VECP's longer than anyone else we know.

How much can you make?

Is there a limit to how much I can make?

The amount is only limited by the size of the contract. The amount you make is a shared percentage of the negotiated accepted estimate of the savings expected (usually 55% of the savings plus development costs).

Is there a limit to how many times I can submit the same idea?

No. If the VECP is valid, the exact same technical detailed VECP can be submitted on as many projects as the contractor has contracts with the feature to be changed. We know of one company that turned in one VECP on a project saving the government a little under a million dollars, which the contractor got $500,000 as a result. They had four other contract bids in play for the exact same type of project. When they won the bids, the immediately turned the same VECP, changed to show the new contract details as you would do in our copy feature, and obtained an instant $2 million in added profit, before they even came to the work site. Thus, in about three months, they made $2.5 million, of clear profit, for little more cost than creating the VECP's.

I will make money on my contract, why bother with the VECP

Pure and simple, profits, good sized profits. Suppose you have a contract for 10 million and you actual profit to the company, after all is said and done, is 6%. That means your firm is planning to take home $600,000 after they pay all the workers, taxes, insurance, equipment, and so on. Generate a VECP for one million, and upon its acceptance, you just got $550,000 for the company. Further, you didn't have to hardly pay anyone to get it. You just doubled your profits.

Why would the government give me extra money?

To reduce their own contract costs, using contractor specific knowledge and proprietary expertise. Also, to use in future, since, unless the contractor specifies otherwise, the idea becomes available for governmental use for as long the government wants to use it. Thus, the can also save on future cots.

Getting the ideas for the changes

Use your own people

You have ideas, your people get ideas. Spend some time discussing them. We advise that after award, the contractor team principles and workers site down and go over the plans. The make suggestions. If you feel you need help, we offer a service to assist you. In a facilitated approach, we have never not had generation of several VECPs as a result of the effort.

Use other company results

Tens of thousands of VECPs and value studies are performed each year. Add to that, suggestion programs and other groups generating ideas. This wealth can be mined to give your firm some ideas that could help you generate the technical issues needed for a VECP.

Use your tax dollars

The government may have generated a ton of ideas already, which are available if you know how to retrieve them. We know of one group that made a cool million just by one person spending three days reviewing records, and then using the system to generate a VECP, which was accepted. Again, they had already made a million dollars, before they even came to the work site.

FAST Diagrams

General description

A FAST (Functional Analysis System Technique) diagram shows the functional elements, and their relative importance. The functions directly to the left and right of the "scope line" are considered essential to the performance of the project and cannot be changed by the acceptance of a VECP. It is helpful to show the prior to change FAST and the FAST after the change. If the FAST shows the essential functions have not changed, it can be used to prove that the essential are not harmed by the change. It is not required to show a FAST diagram. However, almost all instructions from the most governments suggest showing one. Their presence can help the contractor obtain approval and helps the CO demonstrate that they did not harm the purpose of the project by accepting the VECP. [sample FAST]

Prior to change FAST

In most cases, the contractor does not need to generate a FAST of the project before the change. The governmental agency has probably generated one during the design as a result of their mandatory value engineering program. All the contractor need do, is request a copy of the value study report from the agency.

After change FAST

Using the governments FAST, in most cases, it is only a small step to show the change. It is not necessary to show all the details of the FAST, only essential areas and how they are unaffected. Again, it is not required that the contractor submit a FAST, just a helpful suggestion, recommended by all consultants and almost all governmental agencies allowing a VECP.

History

Is this new?

No. The first VE Incentive Clauses are attributed to the US Army Corps of Engineers in the early 1960's. The Office of Inspector General noticed them and started recommending other departments adopt the idea. the Government accounting Office got wind and reported to Congress. Boom, it becomes mandatory for almost all the executive branch. When the US goes, so goes much of the world and boom again, private, state, and International governments are in the frey.

Has it always been this way?

The regulations change about every three years. In the very early concepts, the contractor only got 45% for the first VECP and 55% on the second. Contractors would submit a puny one, then the "real one." They realized the error and changed the clause to 55% on all accepted VECPs. Some state and private groups do not evaluate and update their clauses for lessons learned. This makes it difficult for both the contractor and governmental group, plus dangerous. After all, revisions are made to react to court rulings and other issues (lessons learned). Our systems are designed to help even the group using an old clause obtain the lessons learned, because we use the lessons learned to asked the questions that help ensure a an old clause's defects are augmented by disclosure issues.

Legal Issues

Is the VECP free of risk?

Is sitting at your home free of risk? No. Nothing is free of risk. We attempt to minimize the risk through our continually updated expert systems, but we can only let you know known issues to our experts.

Can you offer us defense?

That is not the purpose of this site. We can provide access to the records, but so can you. If you need further, this is subject to our terms of service. Expert witness testimony is expensive, and lawyers are even more so. Our design is intended to assure it never gets to that point.

Wow. Sounds scary. How much risk is in the VECP

Our records indicate less than 0.5% of VECPs ever generate a dispute, much less a court experience. However, most of those are related to specific issues, and when they do occur, they can be expensive. We design and modify our systems, partly, with the idea that we can reduce that small percentage to nothing. In all the cases our experts have been involved in, or are aware of; using our enhanced system, by both the contractor and CO, would have avoided the problem entirely.

What about new legal issues?

We modify the system to respond to known new issues on a periodic basis. Chances are that our system knows about the situation before the contractor, CO, governmental group, or even the lawyers know that a change is recommended. In most past cases, recommended practices are the key issue, and our system designed around that concept.

[ Go Back ]