An SSSB was convened for the purpose of evaluating the proposals submitted of which there were 12, 5 firms having declined to compete. The board considered the proposals in the light of such factors as technical approach, engineering capabilities, management capabilities, subcontracting plans, program scheduling, production capabilities, and anticipated program costs. Accepted procedures were followed and Boeing Airplane Co. was determined to be the winner of the competition. Similar procedures will be followed to determine the sources from which we will procure the propulsion, guidance and control, and reentry vehicle for the Minuteman. It is pointed out that the two weapon systems mentioned above differ in management concept. Except for the engines, the B-70 contractor manages the complete weapon system, integrates the subsystems, and selects the subcontractors with Air Force approval. The Minuteman system is made up of major components which are integrated into a weapon system by the Air Force Le. (BMD/BMC). Therefore, each major component contractor is considered an associate contractor and selected separately in accordance with the above procedures. For the B-70, a proposed source was recommended by General Rawlings, Lieutenant General Anderson, and General Power, commanders, respectively, of AMC, ARDC, and SAC. General White, Chief of Staff, approved the recommendation and forwarded it to Secretary Douglas for final approval. For Minuteman assembly and test, the initial recommendation for source was made jointly by Major General Funk and Major General Schriever, commanders, respectively, of AMC's Ballistic Missile Center, and ARDC's Ballistic Missile Division, General Rawlings, Lieutenant General Anderson, and General Power, commanders, respectively, of AMC, ARDC, and SAC, concurred in the selection and forwarded their recommendations to General White, Chief of Staff, who approved the recommended selection, which was then approved by Mr. Douglas, Secretary of the Air Force. EXAMPLE OF DESIGN COMPETITION IN PROCUREMENT (ARMY), FEBRUARY 24, 1960 Name of program.—Design and development of armored reconnaissance, airborne assault vehicle (ARAAV). Initially a bidders conference was arranged by notification to industry through the Ordnance district system. The purpose of the bidders conference was to acquaint all qualified industrial concerns who were interested in bidding on the program, as to the requirements of the program, and the manner in which their proposals or bids should be submitted. Representatives of 58 different facilities attended this bidders conference. Of this number 45 evidenced a continued interest and were formally requested by Ordnance to submit proposals. Negative responses were received from 33 facilities. Proposals were received from the following 12 facilities. Aircraft Armaments, Inc.; Borg-Warner Corp.; Chrysler Corp.; Cadillac Motor Division, GMC; Food Machinery & Chemical Corp.; Ford Motor Co.; Harvey Aluminum, Inc.; Jered Industries, Inc.; Pacific Car & Foundry Co.; Ranier Co.; Walter Motor Truck Co.; and Wilson, Nuttall, Raimond, Inc. This These 12 proposals were evaluated by a committee established by the commanding general, Ordnance Tank Automotive Command, Detroit, Mich. committee was composed of competent technical personnel from Ordnance Tank Automotive Command and other Ordnance agencies including Watervliet Arsenal, Frankford Arsenal, and Ballistics Research Laboratory and Human Engineering Laboratory. Nineteen individuals were included in this committee. Factors considered by this committee in the evaluation of the different proposals were: (a) Technical Responsiveness to military characteristics. (b) Producibility of design. (c) Estimated vehicle cost. (d) Experience and production capability. (e) Development time schedule. (f) Manufacturing rights. Based on this evaluation, it was concluded by the committee that two proposals were superior to the others and worthy of further design investigation prior to final contractor selection. The commanding general, Ordnance Tank Automotive Command, based on the committee evaluation and advice of his chief engineer and technical advisers recommended that a limited cost contract be made with each of the two companies to cover preliminary design and vehicle mockup of the two competitive design approaches, in order to assure the best design possible. These contracts are now being negotiated. Upon completion of mockups, a further review will be made by interested Army agencies to determine which of the two design approaches is the most acceptable for meeting the requirements of the development program. At that time the contractor with the best overall design will be selected to continue the development program and the other will be dropped. The recommendations of the commanding general, Ordnance Tank Automotive Command and the planned approach outlined above were approved by the fol lowing additional Army echelons: Lt. Gen. J. H. Hinrichs, Chief of Ordnance, Department of the Army. Lt. Gen. A. G. Trudeau, Chief of Research and Development, Department of the Army. The Honorable George H. Roderick, Assistant Secretary of the Army for Financial Management, approved the negotiation of the contracts mentioned above. The CHAIRMAN. Senator Javits. Senator JAVITS. I know of no subject which is more hotly controverted than the one just touched on. I think this is the one subject that this subcommittee has to go into in this department. Therefore, I would like to ask you this question. The percentages which you have given are very useful and certainly they will be very helpful. But I think the criteria and machinery by which you make your determination is equally important to us. Now, as I understand it, you have really two kinds of competition at least, perhaps you have three. One is where you have an ascer tained item that you negotiate for either on price or design, but you ascertain the item and you ask for people to negotiate with you, but you have them compete one with the other. The other is where you get the so-called weapon system and where all you do is pick a group of concerns. And of all the things that raise the hackles on people's backs, it is that, because there are all kinds of worry about what is the criteria, who is making the decisions and why and to what extent are they based on military implications, to what extent are they based on national economic situations or strategic requirements or what. I think, Mr. Chairman, that this is one subject in which we ought to have, so that we have something upon which to ask questions, a very complete analysis from the Department of Defense as to just how this is done. First, I thoroughly agree with Senator O'Mahoney. Let us have the breakdown, but then let us have how each of these is done and who makes the judgment and whose judgment is final and how does it finally get up to that person who makes the final judgment, or set of persons. I think you can render a great service to the country if it were crystal clear this was a process which, as far as man can make it, endeavors to be fair because this is where all the complaint comes from. Mr. MCGUIRE. Senator, as you know, in the passing of the renegotiation law last year, there was a clause which required a study of our overall procurement program, how it was handled and so forth. This study was to be conducted by both the Senate and the House Armed Services Committees. Now, Senator Thurmond is heading a committee, and I think I am correct that some time in the next 2 or 3 weeks this committee is to start its hearings. In anticipation of this-and it is a very involved subject as you have so ably pointed out, and somewhat misunderstood-we have prepared I think a most comprehensive presentation. I see no reason why we should not make this available to your committee. I think it will answer your question. I am sure that Senator Thurmond would have no objection to it. If it does not answer your question, obviously we are prepared to give you anything that you want in this field. There is no secret I know of. Mr. BANNERMAN. We will certainly make clear to you precisely how major weapons system contractor selection is done. I can assure you it is designed to be as fair but as effective as we can possibly make it. Senator JAVITS. I am sure that is your opinion and we respect it, but of course we would be entitled to a judgment on it ourselves. Mr. Chairman, I think this is a question for the Chair. If the Chair will agree, I think it would be great if we could get this analysis because I think this is one of the biggest questions that trouble the people in the country. Mr. MCGUIRE. We expect to have it complete in about 10 days. The CHAIRMAN. Would you be willing to send us a copy? Mr. MCGUIRE. Yes. I would ask the privilege of having you tell Senator Thurmond that we are doing it, it having been prepared for his committee. The CHAIRMAN. We will make a formal request that a copy be furnished this committee. (The material referred to follows:) |