Just contracting parties, or partners as well? - Opinion

Acquisition Review Quarterly, Summer, 2002 by Thomas I. Siemsen

Government and contractor acquisition personnel are frequently directed by their superiors to trust one another and others with whom they have contracts. Unfortunately, relatively little thought may have been given to what trust consists of or what an act of trust must entail. This paper considers what is involved when one chooses to trust another person, under what circumstances trust may or may not be appropriate, and the consequences of trusting or not trusting. The paper concludes with brief suggestions concerning the ways in which trust might be incorporated into the source selection process.

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I recently had an interesting experience that led to this paper. I had just finished outlining an exercise involving a simulated negotiation to a group of students. When I asked for questions or comments, one of the students raised his hand and asked, "Arc we supposed to treat the people we're negotiating with as if we 're all on the same team, or like it is in the real world?" I responded to his question by asking him to explain why he would not want the "other party" on his own team, and he said, "Because, in the real world, I don't trust them." The question and his response prompted me to think about the possibilities of teaming, partnering, and trust these days.

For a number of years, now, the ideas of teaming and partnering have dominated much of the thinking and practice of management, to include the thinking and practice of defense acquisition management. The U.S. Army Corps of Engineers published a manual titled Partnering for Success that discusses the importance of partnering between the government and its contractors and goes on to describe how a partnering agreement can be established. Similarly, Navy program managers and contracting officers have been employing a process known as "Alpha Acquisition," by which confrontational negotiation in "sole source" acquisitions is replaced by a collaborative process of joint preparation of proposal, which can then be accepted as the contract, without further negotiation. The Air Force has employed a similar process for negotiating contract changes under the title "One-Pass," and the Defense Contract Management Agency has established an equivalent process for many of its negotiations tinder the term "IPT Pricing" (see Ca ldwell, 2001; McDonald, 2001; Nibly & Dyer, 2001; Norby, 2001; Norgard & Valley, 2001).

Indeed, when I went to the Defense Acquisition Deskbook and entered the search word team, I got 5,616 "hits"; IPT produced an additional 1,460 hits, and partner and partnering produced a combined list of 558.

Although each of these practices or programs is a different application of the ideas of teaming and partnering, they all have in common an increased reliance upon trust, not only between the government and its contractor(s), but also a greater degree of trust between management and workers on both sides. However, as the employees of the Enron Corporation recently learned, trust can be dangerous (Glassman, 2001). Indeed, there is always a potential risk associated with trusting someone. Given that, why is trust important, why are managements all over the world encouraging more of it, and why should those of us in contracting be particularly concerned to understand it? Or, to put the last of these questions a little differently, what should we in acquisition begin doing as a way of taking trust seriously, of really incorporating it into our acquisition practices rather than simply admonishing our acquisition professionals on both the contractor and government sides to trust one another?

One way to start that process is to recognize that there is a difference between selecting a contractor and selecting a partner. Those of us in government have become fairly adept at the former; but, if we arc to accomplish the latter, we need to give some thought as to how our source selections will need to be altered. Gilbert Fairholm has suggested that "Trust has not been given much specific attention by either theoretical or practicing professionals" of any kind (Fairholm, 1994, pp. 95-96). This piece is an initial suggestion of the need for some thinking about trust in acquisition and some further preliminary thoughts regarding some possible lines along which some adjustments might be made. But before turning to those adjustments, I want to briefly consider what "trust" is and why it is important.

THE NATURE OF TRUST AND ITS SIGNIFICANCE

Anyone who has played on or even closely watched a successful athletic team has seen trust in action. This is because a team, whether athletic or some other kind, really amounts to a collection of interdependencies or set of mutual reliances. Robert Shaw wrote that "trust grows when we rely on others who, over time, fulfill our expectations" (Shaw, 1997, p. 23). Trust, then, stems from the belief that the other person will do as he/she says, and that the person is both willing and capable of doing what we expect him or her to do. Conversely, if a disparity develops between what we expect of another and the actual performance we receive, distrust is the likely outcome. Although trust among team members or partners does not guarantee success, distrust virtually does guarantee failure. Why this latter is the case we will see shortly. Before we do that, however, we should note that although trust is generally a good thing, it too is a notion that entails potential problems.