AGU’S FOUNDING ORGANIZATION CELEBRATES 50 YEARS IN TRAINING AND EDUCATION


In April 2008 American Graduate University’s (AGU) founding organization, Procurement Associates, Inc. (PAI), celebrated its 50th birthday. It has been an interesting journey.

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News That Impacts Your Career

Service Subcontract Terms and Conditions
The American Bar Association Public Contract Section has published its Guide to Service Subcontract Terms and Conditions.

Full article

Defense Evaluations of Contractors are Useless, IG Finds
The Defense Department is doing a bad job tracking which of its contractors are doing bad jobs, according to a new report.

Full article

DFARS Earned Value Requirements Updated
The DOD FAR Supplement has been revised to supplement FAR rules on the use of earned value management systems.

Full article

Ethics Code Requirements
While all organizations should have a code of ethics, it is now a new requirement for certain government contractors, effective December 24, 2007.

Full article

Cost Accounting Standards
The Federal Acquisition Regulation Part 30 has been amended to implement revisions to the regulations related to the administration of the Cost Accounting Standards.

Full article

Project Management Specific Interest Group
The Project Management Institute (PMI) has chartered a “student centered” Specific Interest Group (SIG).

Full article

Defence Acquisition Chief Requires Program Managers to Sign Tenure Agreements
The Defense Department’s chief acquisition official is reinforcing a policy to make leadership continuity a top priority for weapons programs, in the wake of an annual report that cited frequent management changes as one cause of cost overruns and delays.

Full article

GSA Forms Panel to Review Pricing Policies
The Defense Department’s chief acquisition official is reinforcing a policy to make leadership continuity a top priority for weapons programs, in the wake of an annual report that cited frequent management changes as one cause of cost overruns and delays.

Full article

 

 

AGU Update

AGU Launches New Supply Management Program
There are exciting things afoot at AGU. Starting in June, AGU will begin offering three new programs in supply management.

Full article

AGU Reaccredited for Five Years
American Graduate University has been granted reaccredidation for the maximum period of five years with no conditions by the Accrediting Commission of the Distance Education and Training Commission (DETC).

Full article

Focus on the Faculty
Bill Ryan is one of our most dedicated instructors and brings more than 20 years of professional experience to AGU students.

Bill Ryan

Full article

 

AGU’S FOUNDING ORGANIZATION CELEBRATES 50 YEARS IN TRAINING AND EDUCATION

Paul R. McDonaldBy Paul R. McDonald, President, AGU
In April 2008 American Graduate University’s (AGU) founding organization, Procurement Associates, Inc. (PAI), celebrated its 50th birthday. It has been an interesting journey.

In early 1958, my father Paul R. McDonald, Sr. was working as a civilian for the Army’s Ordnance Corps in Pasadena, California. The Los Angeles area in those days was the leading center in the rapidly growing defense/aerospace industry.

He had previously been given the responsibility for organizing a comprehensive training program for the procurement and finance personnel in the Ordnance Corps Los Angeles District Office since the only training available at the time was at Fort Lee, Virginia.

Realizing that there was really no training at all for people working for prime contractors and subcontractors, Paul Sr. took a risk, borrowed some money from his insurance policy, and put out a detailed brochure advertising a one night a week course in government contracting in downtown Los Angeles.

Thinking he would be able to get 10-15 students and supplement his GS15 salary (not a lot in 1958), he and the rest of the family were stunned when over 60 people signed up for the first course in April 1958.

Over the next two years, course offerings were expanded and conducted in San Francisco, Boston, New York, and Washington, D.C. Finally, running out of annual leave and sick time, Paul Sr. left the Army and worked full time on the growing business.

In the beginning, our house’s garage was the center of the business. Paul Sr. developed the course materials, I reproduced them on a hand-cranked mimeograph machine and my sister Marie McDonald Sirney collated them (albeit reluctantly) on a small six slot collator. Course books were assembled by walking around several ping pong tables, then bound, boxed and driven by me to LAX for shipment.

Over the years, modern technology prevailed and an integral facility for course development, production and delivery was developed.

During the ensuing years, the curriculum was expanded with new courses being offered. Eventually, over 40 classroom non-credit training courses were being offered and taught in the United States, Canada and Europe.

Since there was little written material in the field of government acquisition and contract management, and program management, course materials had to be researched, written, and published by Procurement Associates. In 1960, the first complete textbook in the field was written and published by Procurement Associates. Since then, a large number of textbooks, plus supporting presentation notes, readings, case studies and exercises have been developed and published for each of the acquisition, contracting and program/project management courses.

Paul Sr. had a vision of a specialized university that would offer courses nationwide. He explored how to organize a distance education school under California law and in 1975 American Graduate University was born. At first only one Master’s degree was offered.

Since AGU was not yet accredited, its education program remained small and the training courses remained the largest component. AGU received its initial accreditation in 1998, unfortunately three years after Paul Sr. passed away. AGU was reaccredited in 2003 and is looking forward to another reaccreditation by the Accrediting Commission of the Distance Education and Training Council in June.

While AGU was under control of another organization for several years, Marie and I regained control in 2006 and are continuing to expand its offerings. We currently offer five Master’s degrees and five Master’s Certificate programs. In addition, we offer over 30 classroom training courses.

It has been an interesting journey over the years – building a training business into a fully accredited university with over 1,000 degree students. We have had some ups and downs but always have been lucky to have had the unflagging support of our staff and faculty, many of whom have been with AGU for many years.

So – we are off to the next 50 years!


News That Impacts Your Career

Service Subcontract Terms and Conditions
The American Bar Association Public Contract Section has published its Guide to Service Subcontract Terms and Conditions. The Guide is intended “to help Government prime contractors and subcontractors select mandatory and advisable flow-down clauses for subcontracts, along with suggested representations and certifications, commercial item contract clauses, and intellectual property clauses.” The book is available at www.ababooks.org.

Defense's Evaluations of Contractors are Useless, IG Finds
The Defense Department is doing a bad job tracking which of its contractors are doing bad jobs, according to a new report.

DOD officials are supposed to evaluate the performance of its contractors soon after they complete their work and file those so-called past performance reports into a central database. If a company does poorly, then others at the department could look at the database to find out about it and avoid that company in future contract projects.

But Defense contracting officials are filing many reports late, filing them incompletely, or filing them with evaluations so vague that they’re useless, the Defense Department’s inspector general said in a report released February 29. Furthermore, the reports that are being filed are not being read in many cases by contracting officials when it comes time to make contract award decisions.

DFARS Earned Value Requirements Updated
The DOD FAR Supplement has been revised to supplement FAR rules on the use of earned value management systems. The DFARS changes include:

  • For cost or incentive contracts and subcontracts valued at $20,000,000 or more, the rule requires an earned value management system that complies with the guidelines in the American National Standards Institute/Electronic Industries Alliance Standard 748, Earned Value Management Systems (ANSI/EIA-748).
  • For cost or incentive contracts and subcontracts valued at $50,000,000 or more, the rule requires an earned value management system that has been determined by the cognizant Federal agency (as defined in FAR 2.101) to be in compliance with the guidelines in ANSI/EIA-748.
  • For cost or incentive contracts and subcontracts valued at less than $20,000,000, the rule provides that application of earned value management is optional and is a risk-based decision.
  • For firm-fixed-price contracts and subcontracts of any dollar value, the rule discourages the application of earned value management.
  • The Defense Contract Management Agency is assigned responsibility for determining earned value management compliance when DOD is the cognizant Federal agency.
  • Requirements for contractor cost/schedule status reports are eliminated.

The coverage may be found at DFARS Subpart 234.2 and 252.234-7002.

Ethics Code Requirements
While all organizations should have a code of ethics, it is now a requirement for certain government contractors. Federal Acquisition Regulation Subpart 3.10 requires that within 30 days after a contract award of at least $5 million with a performance period of at least 120 days (a triggering contract), the new regulations require contractors to adopt a written code of business ethics and conduct. Contractors needing more time to adopt such a written code may request an extension from the contracting officer. Thus, while the new regulations are effective on December 24, 2007, individual contractors will not be required to adopt a code of business ethics and conduct until they are awarded a triggering contract containing the new clause at FAR 52.203-13, “Contractor Code of Business Ethics and Conduct (Dec. 2007).”

The new regulations also require each contractor to promote compliance with its code of business ethics and conduct. Large businesses must establish business ethics awareness programs and internal control systems within 90 days after award of a triggering contract. Contractors that represented themselves as a small business concern in connection with the award of a triggering contract do not need to comply with this requirement. A large business needing more time to establish its awareness program and internal controls may request an extension from the contracting officer.

The new regulations do not provide any guidance on the contents of either the required code of business ethics or the required business ethics awareness program. The regulations do set forth elements of an effective internal control system. Internal controls must facilitate timely discovery of improper conduct in connection with government contracts and ensure prompt corrective action.

The regulations do not apply to contracts for commercial items or contracts performed outside the U.S.

Cost Accounting Standards
TThe Federal Acquisition Regulation Part 30 has been amended to implement revisions to the regulations related to the administration of the Cost Accounting Standards. Among other changes, the rule streamlines the process for submitting, negotiating, and resolving cost impacts resulting from a change in cost accounting practices or noncompliance with stated practices.

The Cost Accounting Standards Board in the Office of Federal Procurement Policy has adopted a final rule to amend Cost Accounting Standard (CAS) 412, “Cost Accounting Standard for composition and measurement of pension cost,” and CAS 415, “Accounting for the cost of deferred compensation.” These amendments address issues concerning the recognition of the costs of Employee Stock Ownership Plans (ESOPs) under Government cost-based contracts and subcontracts. These amendments provide criteria for measuring the costs of ESOPs and their assignment to cost accounting periods. The allocation of a contractor’s assigned ESOP costs to contracts and subcontracts is addressed in other Standards. The amendments also specify that accounting for the costs of ESOPs will be covered by the provisions of CAS 415, “Accounting for the cost of deferred compensation,” and not by any other Standard. This rulemaking is authorized pursuant to Section 26 of the Office of Federal Procurement Policy (OFPP) Act. (73 Federal Register 23961)

Project Management Specific Interest Group
The Project Management Institute (PMI) has chartered a “student centered” Specific Interest Group (SIG). The purpose of the group is to give a “voice” to the student members of PMI and be a welcome mat to the project management profession. Membership is $10 a year and the website address is www.studentsofpm.org.

Defense Acquisition Chief Requires Program Managers to Sign Tenure Agreements
The Defense Department’s chief acquisition official is reinforcing a policy to make leadership continuity a top priority for weapons programs, in the wake of an annual report that cited frequent management changes as one cause of cost overruns and delays.

John Young, Defense undersecretary for acquisition, technology and logistics, said at a media roundtable in April that the department has been working on an initiative to reduce turnover by requiring program managers to sign service agreements. Under these agreements, program managers serve three or four years or to the nearest milestone in the contract. They also delineate cost, schedule and performance expectations for the length of the agreement.

The department has had a policy of service agreements for program managers on the books since December 2005, soon after a Government Accountability Office (GAO) report identified management instability as a hindrance to the progress of weapons programs. A follow-up report in November 2007, however, showed that Defense still was working to implement tenure requirements. As recently as May 2007, the department was issuing memos on program manager agreements clarifying what exactly they would include, when they would be signed and by whom. GAO’s recently released annual report on weapons programs showed the problem to be persistent.

Frequent staff changes, especially during the development stages of an acquisition, can “make it difficult to hold one program manager accountable for the content of the program’s business case when it is established and to ensure that a knowledge-based acquisition process is followed,” GAO wrote.

The report noted that there was substantial program manager turnover despite Defense’s policy requiring managers to stay at least until the completion of the major milestone nearest their four-year tenure mark. For 39 major acquisition programs GAO examined since March 2001, the average tenure for program managers was about 17 months.

Young said, as of the last few months, agreements are required for major acquisition development programs at the department level and include the signatures of program managers, acquisition executives and finance managers. He encouraged the military services to set the same requirement.

GSA Forms Panel to Review Pricing Policies
Facing complaints about its pricing policies and oversight, the General Services Administration announced on April 17 that they have formed an advisory panel to review policies for its Multiple Award Schedule contracts.

“Our multiple award schedule program faces challenges,” said GSA Administrator Lurita Doan. “Often the government isn’t a good customer, and the guidelines and rules are tough. As a result, companies across the country report they are growing increasingly frustrated. I believe the time is now for GSA to face this challenge and do something to address it.”

The Multiple Award Schedules are indefinite delivery, indefinite quantity contracts negotiated by GSA for commercial products and services. GSA awards the contracts for a base period of five years, plus three five-year options. The federal government and other authorized users issue task and delivery orders against the contracts. State and local governments also can use many of the contracts.

But recently, companies have expressed frustration with the myriad rules and pricing regulations associated with the contracts. Last year Sun Microsystems, EMC Corp. and Canon USA chose not to renew their GSA schedule contracts because of increased scrutiny from the agency’s inspector general regarding their pricing policies. Canon officials said their reason not to renew its contracts were due to “unreasonable demands” from GSA’s inspector general. The inspector general often audits companies at the time of contract renewal, a process that requires companies to prove that the government is paying the most competitive price.

Among the issues that Doan said the panel would examine is pricing reduction clauses, which are triggered when an agency’s purchase meets a certain volume. “We’ve had a growing frustration among our industry partners because there is some confusion over the auditing process and what will cause the pricing reduction clause to be triggered, when, why and how. For us to be good clients, we must be able to provide clear guidance on what we need, when we need it and where we need it.”


AGU Update

AGU Launches New Supply Management Program
Starting in June, AGU will begin offering three new programs in supply management. They are:

  • Master of Supply Management (MSM) degree program (36 units)
  • Master of Business Administration – Supply Chain Management Concentration degree program (48 units)
  • Master’s Certificate in Supply Management (6 courses)

Effective supply management is essential to an organization’s success. Supply chain performance contributes directly to the financial and operational efficiency of both corporate and government entities. Supply management is not only concerned with the steps in the operations and procurement processes, but also the requirements generation process and logistics activities including receiving, inspection, materials handling, transportation storage, and distribution.

The purpose of the Supply Management programs are to help improve students’ work capabilities and to prepare themselves for increasing supply management responsibilities by the development of an intensive knowledge of their chosen discipline on a broad base of information on the management theories, procedures, practices, techniques and skills associated with business operations. The programs provide a practical framework for how organizations manage the enterprise-wide functions of supply in today’s business environment with focus on supply chain management issues.

The programs cover the conduct and management of the supply management function – how that function interacts with the other principal business functions, including product development, marketing, operations, finance and logistics – the conduct of the supply chain process, including the integration of requirements determination, supplier development, qualification and selection – and supplier relations and performance.

The programs will become available for registrations this June. Please watch the AGU website for more detailed information (www.agu.edu). Preliminary information on the new programs can be obtained by contacting studentservices@patten.edu.

AGU Reaccredited for Five Years
American Graduate University has been granted reaccredidation for the maximum period of five years with no conditions by the Accrediting Commission of the Distance Education and Training Commission (DETC). The Commission is a national accrediting agency recognized by the U.S. Department of Education and by the Council for Higher Education Accreditation.

AGU began the rigorous reaccredidation process more than nine months ago with the preparation of a detailed Self Evaluation Report on its processes, procedures, curriculum and plans. The Report was submitted to DETC in January for review as several AGU courses were concurrently reviewed by subject matter experts. In early April, a visiting team of outside evaluators and DETC staff reviewed AGU's operations and interviewed AGU staff, faculty and students and submitted a very positive report to the Accrediting Commission. The Commission granted AGU reaccreditation the first week of June.

Thanks to the AGU staff, faculty and students who made this important achievement possible!

Focus on the Faculty
Bill Ryan is one of our most dedicated instructors and brings more than 20 years of professional experience to AGU students

Focus on FacultyChances are your first instructor here at AGU will be Bill Ryan who teaches Course 602, Essentials of Management. Bill really enjoys helping students adjust to distance learning and takes a special interest in each one of them.

Having over twenty years of professional experience focused in sales, marketing, product development and strategic planning in large corporate environments, mid-sized entrepreneurial organizations and start-up businesses, Bill brings a broad base of education, experience, as well as knowledge of marketing products and services in a wide range of industries, to AGU. He received his undergraduate degree in Business Administration—Information Systems from the University of Colorado and his Master of Business Administration from the University of LaVerne. This coupled with years of experience enables him to provide AGU students with constructive and thoughtful feedback in Course 602, as well as his other two courses: Course 606, Marketing, and Course 659, Organizational Behavior.

What Bill enjoys most is spending time with his wife, Dayna and sons Weston and Blake (please see attached picture). He and his family are active in their church as well as with their sons’ sports activities. Bill’s favorite hobbies are playing golf with his boys as well as trips to the beach to watch them surf.

Advance Your Career With AGU

AGU Course Receives Equivalency for Three DAU Courses
American Graduate University has achieved equivalency for its Course 601, “Federal Government Contracting,” for several Defense Acquisition University courses. The DAU courses are CON 110, “Mission Support Planning,” CON 111, “Mission Planning Execution,” and CON 112, “Mission Performance Assessment.” AGU students completing the 30 module distance education course will receive credit for the three DAU courses. AGU Course 601 includes coverage on:

  • Contract Procedures
  • Laws and Regulations Governing Procurement
  • Government Contract Law
  • Methods of Procurement
  • Types of Contracts
  • Developing the Requirement
  • Developing the Solicitation
  • Statements of Objectives/ Statements of Work
  • Source Selection Procedures
  • Government Marketing/Business Development
  • Proposal Preparation
  • Pricing
  • Estimating
  • Profit and Fee
  • Cost or Pricing Data
  • Price and Cost Analysis
  • Cost Principles and Cost Accounting Standards
  • Negotiation Techniques
  • Contract Terms and Conditions
  • Contract Financing
  • Contract Management and Administration
  • Contract Changes and Modifications
  • Remedies, Disputes and Claims
  • Terminations for Default
  • Terminations for Convenience
  • Contract Closeout

In addition, AGU staff and faculty are working on developing new distance courses to apply for equivalency for DAU courses CON 216, “Legal Consideration in Contracting,” and CON 217, “Cost Analysis and Negotiation Techniques.”

Please watch for future announcements.


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