Lowest price technically acceptable procurements have been gaining favor among agencies, but that gives vendors less incentive to be innovative if the approach costs more, an Oct. 24 Market Connections and Centurion Research study says.
Under LPTA, agencies focus more on price than on past performance as long as the vendor meets minimal job requirements. So if a vendor comes to an agency with a unique solution that costs more than a competitor who comes with a more basic solution, the agency is more likely to choose the cheaper solution as long as it meets the minimum requirements.
The practice has been utilized by the Defense Department through its Better Buying Initiative, the study says, but has proliferated through other agencies as well.
The study showed that of the $27 billion in procurements it analyzed, the Veterans Affairs Department was the biggest user of LPTA outside of the DoD.