Increasing Defense Contractor Competition in a Predominately Sole Source Contracting Environment

Abstract

This research was derived from a Naval Supply Systems Command Weapons System Support (NAVSUP-WSS) problem statement which identified that more than 80% of WSS contracts occur in a sole-source environment. Operating in this environment presents supply chain constraints, cost, and readiness risks for the Navy. The purpose of this research is to analyze the NAVSUP-WSS sole-source contracting environment to determine methods for increasing competition. We utilized the resource dependency theory as our foundational framework and employed a mixed-method approach involving both qualitative and quantitative methodologies for our research. We analyzed more than 62,000 contracting actions and conducted spend analysis on WSS procurements for FY19-FY20 and we reviewed NAVSUP’s supply chain and contracting operation following Kraljic’s supply matrix. Our results identified the top four items frequently procured under sole-source conditions, the percentage of awards and dollar amount awarded to the top WSS contractors, and the policy and operational conditions that contribute to the WSS sole-source environment. Lastly, we developed a NAVSUP-WSS supply matrix to apply methods for increasing defense contractor competition for selected items that were identified as a result of our spend analysis.