Running Head: SCENARIO ACTIVITY

Scenario Activity

DeVry University/Keller Graduate School of Management  

PROJ 598 Contract and Procurement Management  

February 13, 2019  

Table of Contents
SCENARIO ACTIVITY 2

Decision Factors..........................................................................................................................................3
Pros and Cons..............................................................................................................................................4
Required Elements......................................................................................................................................5
Debrief Meeting Prep..................................................................................................................................6
References...................................................................................................................................................7
SCENARIO ACTIVITY 3

Decision Factors

Integrated Systems Design (ISD) has been awarded a contract from the government for

the exclusive use of the Independent Operation (IO) technology. This award will guarantee the

protection of technology and 30 million dollars over the next five years. The U.S. Military and

Department of Defense intends to use this technology for drones that will allow for continued

operations without needing to remain in contact. There is some debate as to which decision to

make. ISD can find a win-win strategy to this negotiation by separating the people from the

problem, focus on interests, not positions, invent options for mutual gains, and insist on using an

objective criterion [ CITATION Lin141 \l 1033 ]

Iris, ISD President, and CEO, believes this contract will guarantee a future, protection,

and predictability for the company. By having the government protect the technology, will keep

this technology being reversed engineered and getting into the wrong hands. It will also allow

the company to have a steady cash flow due to a steady contract. Tony, ISD Vice President,

Sales and Marketing, thinks the contract will hurt the sales of future business. By giving the

government exclusive rights will no longer allow ISD to sell the IO technology to other clients.

Plus, this contract will not allow the technology to be applied to a much broader appeal. Phil,

ISD Vice President, Operations is concerned about the supply chain and the ability to double

production in a short amount of time. Proprietary technology will also need to be shipped from

Los Angeles to Virginia and there is a risk of unexpected delays in transport and security

concerns. If ISD over promises and under delivers, the government will have a reason to cancel

the contract.

As the Project Manager over the IO technology, I think we should move forward with the

government contract as this will protect our current technology. Our team understands the risks
SCENARIO ACTIVITY 4

and national impact if this technology is not used in the proper way. With the predicted revenue

from the contract, we can build operations in Virginia to maintain, and secure, the supply-

demand and create another division to develop new technologies for clients. This contract will

allow our company to continue to research and develop high end, highly reliable and cutting-

edge technology.

Pros and Cons

Pros

1) Protection on technology

2) Protection of interests

3) Guaranteed Revenue

Cons

1) Small supply chain

2) Application of technology

3) Loss of opportunity for sales

As a growing supplier of military electronics, one of the pros of signing the contract with

the government is the protection of this new technology. ISD is aware that other companies, and

outside clients, are looking at what we are developing and trying to replicate or go to market

before us. This contract will also allow our company to continue to work on other initiatives as

long as the contract is well written. The guaranteed revenue will allow ISD to invest back into

the company by adding another research and development department and to grow capacity in

Virginia.
SCENARIO ACTIVITY 5

However, to grow the supply chain takes time, and the government depends on timely

delivery. If there is a delay in the supply of the product, the military may experience a negative

impact on its operations. This technology is relatively new and by giving exclusive rights to the

military, ISD will not able to explore other alternatives to how the technology can be applied.

ISD may also lose important clients and the opportunity to gain more revenue than the contract

for IO technology.

Required Elements

To execute this government contract, the following are recommended required elements

that legal should include protecting the interests of ISD: Purpose and background of the contract,

assumptions for the contract, restrictions and confidentiality provisions, contract renewal terms,

and ownership of intellectual property [ CITATION Lin141 \l 1033 ].

The purpose and background of the contract will establish the parties involved and

empower the parties to make agreements that are enforced by the law [ CITATION Kif12 \l 1033 ].

The assumptions clause will allow ISD to pass the responsibility to protect the IO technology to

the government with the exchange of guaranteed revenue [ CITATION Kag18 \l 1033 ] . By adding a

non-compete clause and confidently provisions to the contract will protect ISD if the government

chooses to break the contract and sign with a competing company as the government would have

access to trade secrets [ CITATION Mur19 \l 1033 ]. As ISD will continue to develop new

technology, it is important to include contract renewal terms to allow the business agreement to

remain if the specifications and conditions are going well [ CITATION Mit19 \l 1033 ] . This contract

should also reflect ISD as the owner of intellectual property and the government as the user of

the technology [CITATION Wha20 \l 1033 ].

SCENARIO ACTIVITY 6

Debrief Meeting Prep

Before ISD finalizes a decision, the government has requested the company to attend a

debrief meeting as part of the award. It is important that ISD does not share trade secrets,

confidential information, pricing of any competitor, profit margins, or any weighted evaluation

results in the RFX [ CITATION Lin141 \l 1033 ]. The trade secrets and confidential information are

only to be shared upon an agreed above and signed contract. The government does not need to

know the reason behind our decision for the award.

The focus of this meeting should be on the IO technology and lessons learned from the

application of the technology with drones. ISD should also enhance the opportunity by

demonstrating the quality of the production of military-grade electronics and guidance systems

and the relationship is primarily doing business with the US Military and Department of

Defense. We want to show off our technology and why the best company for the job. We would

also want to show the government, on a high level, how we intend to fulfill the scope with the

increasing demand for our production line.

References
SCENARIO ACTIVITY 7

Haden, J. (2016, July 11). 11 ways to negotiate better with anyone (especially if you hate to negotiate).
Retrieved from Inc. This Morning: https://www.inc.com/jeff-haden/11-ways-to-negotiate-
better-with-anyone-even-if-you-don-t-like-to-negotiate.html

Kagan, J. (2018, June 12). Assumption clause. Retrieved from Investopedia:

https://www.investopedia.com/terms/a/assumption_clause.asp

Kifelew, M., & Shiferaw, D. (2012, March 06). The purpose and scope of contract law. Retrieved from
Abyssinia Law: https://www.abyssinialaw.com/online-resources/study-on-line/item/417-the-
purpose-and-scope-of-contract-law

Lindstrom, D. (2014). Procurement Project Management Success: Achieving a Higher Level of

Effectiveness. Plantation, FL: Ross Publishing.

Mitchell, C. (2019, July 8). Renewal option. Retrieved from Investopedia:

https://www.investopedia.com/terms/r/renewal-option.asp

Murray, J. (2019, May 14). Common restrictive covenants in business contracts. Retrieved from The
Balance Small Business: https://www.thebalancesmb.com/common-restrictive-covenants-in-
business-contracts-397816

National Paralegal College. (2020). What is intellectual property? Retrieved from Law Shelf:
https://lawshelf.com/coursewarecontentview/what-is-intellectual-property