BNUMBER:  B-274246.10  
DATE:  September 17, 1998
TITLE: Symetrics Industries, Inc., B-274246.10, September 17, 1998
**********************************************************************

DOCUMENT FOR PUBLIC RELEASE
The decision issued on the date below was subject to a GAO Protective 
Order.  This redacted version has been approved for public release.
Matter of:Symetrics Industries, Inc.

File:     B-274246.10 

Date:September 17, 1998

Edward J. Kinberg, Esq., for the protester.
Sophia L. Rafatjah, Esq., Tracor, Inc., and Robert T. Ebert, Esq., and 
Paul Shnitzer, Esq., Crowell & Moring, for Tracor Aerospace, Inc., the 
intervenor.
Jo Ann Stringfield, Esq., and Gregory H. Petkoff, Esq., Department of 
the Air Force, for the agency.
Ralph O. White, Esq., and Christine S. Melody, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Contention that agency unreasonably evaluated protester's 
technical proposal, and improperly concluded that the awardee's 
higher-rated, higher-priced proposal offered the best value to the 
government, is denied where the record shows that the agency 
evaluation was reasonable, and in accordance with the stated 
evaluation criteria.

2.  Protester's assertion that the agency failed to hold meaningful 
discussions regarding two areas where its proposal was assessed 
moderate risk is denied where the record shows that in both instances 
the agency clearly advised the protester of the factual underpinning 
of its concerns.

DECISION

Symetrics Industries, Inc. protests the award of a contract to Tracor 
Aerospace, Inc. by the Department of the Air Force, pursuant to 
request for proposals (RFP) No. F33657-96-R-0001, issued for the 
purchase of Lots V through VII of the AN/ALE-47 Countermeasures 
Dispenser System (CMDS).  Symetrics argues that the evaluation of 
proposals was unreasonable, that discussions were improper, and that 
the selection decision lacked a reasonable basis.

We deny the protest.

BACKGROUND

This protest challenges the reselection of Tracor for award by the Air 
Force following an earlier decision by our Office sustaining 
Symetrics's protest of the initial selection of Tracor.  The earlier 
protest was sustained because the record showed there had been a 
material change in the agency's requirements after the solicitation 
was issued and before the award date, and because the change in 
requirements may have significantly affected the evaluation.  
Symetrics Indus., Inc., B-274246.3 et al., Aug. 20, 1997, 97-2 CPD  para.  
59 at 8.  In response, the Air Force amended its solicitation, 
requested a new round of proposals, held discussions with the three 
offerors still participating in the competition, and reevaluated best 
and final offers (BAFO). 

As explained in our earlier decision, the AN/ALE-47 CMDS is an 
electronic warfare system used by the Army, Navy and Air Force to 
protect aircraft from hostile missile attacks.  The system discharges 
chaff cartridges and decoy flares to distract ground-launched missiles 
aimed at aircraft.  Five distinct line replaceable units (LRU) 
comprise the system in varying numbers and configurations depending on 
the aircraft involved.  These LRUs are a control-display unit, a 
programmer, a switch assembly, a digital sequencer, and a dispenser 
assembly.  

The RFP here, first issued in October 1996, contemplated the award of 
a 4-year fixed-price, indefinite-delivery/indefinite-quantity (ID/IQ) 
contract to the offeror whose proposal provided the best value to the 
government.[1]  The RFP explained that the proposal with the best 
value would be "the most advantageous offer, price and other factors 
considered . . . providing the best mix of utility, technical quality, 
business aspects, risks, and price for a given application."  RFP  sec.  
M.1.0.  

The RFP advised that each proposal would be evaluated in four areas, 
in descending order of importance:  technical, schedule, 
cost/price--most probable life cycle cost, and management.  Under 
these four factors, the technical factor included four subfactors of 
equal weight:  manufacturing/quality assurance, integrated logistics 
support, systems engineering, and testing.  In addition to the four 
factors, the RFP also listed four general considerations of equal 
weight, all of which were less important than the four evaluation 
factors.  The general considerations were pre-award survey, executive 
in-plant review, plant visits, and RFP terms and conditions.  RFP  sec.  
M.2.0.

Offerors were also advised that two of the evaluation 
factors--technical (including the four subfactors) and 
management--would be assigned a color/adjectival rating, a proposal 
risk assessment, and a performance risk assessment.[2]  They were also 
advised that the color/adjectival rating and the two risk ratings 
would receive equal consideration.  RFP  sec.  M.6.0.  The remaining two 
evaluation factors--schedule and cost/price--were not rated but were 
assigned a performance risk assessment.  

After the evaluation of BAFOs in the most recent round of this 
procurement, Tracor's proposal received two blue ratings (exceptional) 
and two green ratings (acceptable) under the four equally-weighted 
technical subfactors, a green rating under the management factor, and 
low risk ratings in every assessment of proposal and performance risk.  
However, Tracor's proposal had the highest price of any offeror, $19.8 
million with a most probable life-cycle cost (MPLCC) of $78.2 million. 
Symetrics's proposal received all green ratings under the technical 
and management factors.  While Symetrics received low risk ratings in 
all of the assessments of performance risk, it received two moderate 
risk ratings and three low risk ratings under the assessments of 
proposal risk.  Specifically, Symetrics received a moderate risk 
rating under the technical subfactor of manufacturing/quality 
assurance, and under the management evaluation factor.  Symetrics's 
proposal offered the lowest price of the three remaining competitive 
range offerors, $18.7 million with a MPLCC of $77.4 million.  A 
summary of these results is shown in the table below:

                        TRACOR           SYMETRICS

                   Color
                  Rating Prop
                          Risk Perf
                               Risk   Color
                                     Rating Prop
                                            Risk  Perf
                                                  Risk

Technical                                         

     --Mfg./QA   Blue    Low   Low   Green  Mod.  Low

     --Int. Logistics    SupportBlueLowLowGreenLowLow

     --Systems Eng'gGreenLow   Low   Green  Low   Low

     --Testing   Green   Low   Low   Green  Low   Low

Schedule             -----  -----Low    -----  -----Low

Price (MPLCC)    $78.2M    -----Low  $77.4M   -----Low

Management       Green   Low   Low   Green  Mod.  Low
In selecting Tracor over Symetrics, the source selection authority 
(SSA) noted that Tracor had a higher price and MPLCC, but concluded 
that the price difference was insignificant given Tracor's superior 
manufacturing processes and integrated logistics support capability, 
reflected in its blue ratings under the manufacturing/quality 
assurance and the integrated logistics technical subfactors.  In 
addition, the SSA expressed concern that Symetrics might not 
effectively manage this program because of a recent change in 
Symetrics's ownership and corporate structure.  Accordingly, the SSA 
concluded that Tracor's proposal offered the best value to the 
government and awarded to Tracor.[3] 

DISCUSSION

Symetrics disputes each evaluation conclusion that provides a basis 
for distinguishing between its proposal and Tracor's.  Specifically, 
Symetrics argues that there was no reasonable basis for awarding 
Tracor a higher rating under the manufacturing/quality assurance and 
the integrated logistics technical subfactors, and no reasonable basis 
for concluding that Symetrics's proposal presented a moderate level of 
risk under the manufacturing/quality assurance technical subfactor, 
and under the management factor.  

In considering protests against an agency's evaluation of proposals, 
we will examine the record to determine whether the agency's judgment 
was reasonable and consistent with the stated evaluation criteria and 
applicable statutes and regulations.  ESCO, Inc., B-225565, Apr. 29, 
1987, 87-1 CPD  para.  450 at 7.  Here, we have considered each of 
Symetrics's contentions, the evaluation materials, the proposals, and 
the Air Force's response to Symetrics's arguments.  As a result of our 
review, we find no basis for concluding that the evaluation was 
unreasonable, or not in accordance with the stated evaluation 
criteria.  To illustrate our conclusion, we will discuss in detail a 
sampling of Symetrics's arguments.

With respect to the distinction drawn between Tracor and Symetrics 
under the manufacturing/quality assurance subfactor, Tracor received a 
rating of blue (exceptional) after the evaluators identified several 
significant strengths in this area of its proposal.  Specifically, the 
evaluation shows that Tracor's proposal indicates "[e]xceptional work 
measurement and quality assurance programs," "[a]ll known production, 
schedule and [quality assurance] risks have been mitigated," and 
"[s]killed, experienced and stable workforce in place."  Under these 
three headings were other more detailed evaluation comments.  The 
evaluators identified no significant weaknesses in the proposal, and 
no proposal risk.  Addendum to Proposal Analysis Report, May 12, 1998, 
at 16.

Symetrics received a rating of green (acceptable) after the evaluators 
identified one significant strength, no significant weaknesses, and 
moderate proposal risk.  Symetrics's significant strength was its 
"[s]trong understanding of work measurement," but the company was 
assessed a moderate proposal risk because the proposal's "labor hours 
appear to be low for a first time producer of a system of this 
complexity."  Id. at 14.  

The SSA made the following comments when comparing the offerors under 
this technical subfactor:  

     Tracor's rating was based, in part, upon Tracor's exceptional 
     work measurement and quality assurance programs.  Tracor's "6 
     Sigma" statistical process control minimizes manufacturing 
     defects as demonstrated by the [deleted] success rate for circuit 
     card tests currently being obtained on the AN/ALE-47 production.  
     Tracor and [Offeror A] received a low proposal risk rating for 
     this factor.  Symetrics received a moderate proposal risk rating 
     for this factor based upon their unrealistically low labor hours 
     in their cost proposal for a first time producer of a system of 
     this complexity.  The hours in the cost proposal were lower than 
     the hours detailed in their technical proposal which the 
     evaluation team believed to be more reasonable.  During the 
     course of discussion over this difference, Symetrics revised 
     their technical proposal to match the lower hours in the cost 
     proposal; however, they did not offer an adequate justification 
     for the difference between the two portions of their proposal.

Source Selection Decision, May 14, 1998, at 2-3.

Symetrics argues that it was unreasonable for the agency to give 
additional credit to Tracor for its Six Sigma Program, a quality 
assurance process, because the program is not as highly regarded as 
the Air Force believes; because the Air Force mistakenly concluded 
that Tracor's performance under the Six Sigma Program was exemplary; 
and because giving credit to Tracor for this expensive quality program 
constructively eliminates small businesses from the competition in 
violation of congressional direction that a full and open competition 
be held for this system.  Symetrics also argues that the Air Force 
improperly overlooked favorable past performance information for 
Symetrics contained in performance reports from 1994, 1995, 1996, and 
1997 (among other places).  In addition, Symetrics argues that, under 
the guidelines in the Air Force's own evaluation plan, Symetrics 
should have received a rating of blue, not green, under this factor.

As an initial matter, magazine, newspaper, and on-line articles 
submitted by both the Air Force and Symetrics show that the Six Sigma 
Program--for which Tracor's proposal received credit--is a quality 
assurance process that has received considerable favorable review in 
the mainstream and manufacturing press.  While the articles overall 
indicate that the Six Sigma Program can lead to significant 
improvements in manufacturing quality, Symetrics offers two articles 
that question whether the program is worth its cost, or is merely the 
latest in a series of industry fads related to improving quality.

We need not reach a conclusion about whether the Air Force or 
Symetrics is correct about the merits of the Six Sigma Program.[4]  
The record amply demonstrates that the program is a mainstream effort 
to improve manufacturing quality and that a number of major 
corporations have implemented portions of the program.  In our view, 
it was reasonable for the Air Force evaluators to recognize and value 
Tracor's attempt to implement this kind of quality improvement 
program.  In addition, we do not view the evaluation's recognition of 
Tracor's Six Sigma Program as a constructive elimination of small 
businesses from consideration here.  While Symetrics may be correct in 
its contention that the cost of implementing the program is generally 
beyond the reach of small businesses, the solicitation here did not 
require the program.  Instead, the evaluators viewed the program as a 
benefit of Tracor's proposal, and included the program in the list of 
discriminators when deciding which proposal represented the best value 
to the government.  We see nothing improper about the evaluation in 
this regard.

Symetrics also argues that the Air Force's award of a blue rating to 
Tracor under this factor was unreasonable because Tracor's 
achievements under its Six Sigma Program were overstated.  
Specifically, Symetrics argues that the Air Force was wrong when it 
stated that "Tracor is currently operating at an average of [deleted] 
in the six sigma program which puts their manufacturing facility in 
line with the top facilities in the world."  Addendum to Proposal 
Analysis Report, supra, at 17.  Symetrics points to one of the 
articles on the Six Sigma Program reprinted in the agency report and 
urges that under the standards set forth there Tracor's [deleted] 
rating puts the company "at the top end of the industry average."  
Symetrics's Comments on the Agency Report, July 31, 1998 at 15.  Thus, 
in Symetrics's view the evaluation conclusion was unreasonable.

In our view, even if we accept Symetrics's characterization of 
Tracor's [deleted] quality rating within the Six Sigma Program, the 
distinction between the Air Force's comments that Tracor's facility is 
"in line with the top facilities in the world" and Symetrics's 
comments that Tracor is "at the top end of the industry average" does 
not compel us to conclude that the evaluation was unreasonable and 
should be overturned.  The minor difference between these two 
assessments is well within the realm of the agency's discretion to 
make reasonable assessments of proposals.  See ESCO, Inc., supra.

We also reject Symetrics's contention that the distinction drawn 
between its proposal and the proposal submitted by Tracor was 
unreasonable because past performance reports for Symetrics show very 
high quality ratings in its manufacture of a related system.  As shown 
above, in the agency's assessment of past performance, both Symetrics 
and Tracor received ratings of low performance risk.  However, the 
proposal ratings were not based on past performance.  Instead, the RFP 
at section M.3.1.1 explained that the agency would evaluate the 
offeror's manufacturing management program and quality system 
approaches.  The evaluators concluded that Symetrics had a strong 
understanding of the work measurement requirements of the 
solicitation, and awarded the company a rating of  green (acceptable).  
Favorable reports about Symetrics's past performance do not establish 
that this rating was unreasonably low.

As a final evaluation matter, Symetrics contends that the Air Force's 
own evaluation plan requires that Symetrics receive a rating of blue, 
not green, under the manufacturing/quality assurance subfactor.  
Specifically, Symetrics points out that the Air Force defined the 
rating of blue (exceptional) as "[e]xceeds specified performance or 
capability in a beneficial way to the Air Force and has no significant 
weakness."[5]  According to Symetrics, since the definition of a blue 
rating uses the word "way" in the singular, and since the evaluators 
noted a strength under this subfactor (with no significant weakness), 
the agency's own evaluation scheme mandates a rating of blue 
(exceptional).

As a preliminary matter, we note that the standardized color ratings 
used by the Air Force here are set forth in the Air Force Federal 
Acquisition Regulation Supplement (AFFARS), Appendix BB,  sec.  BB-304.  
These rating definitions reflect internal instructions to agency 
personnel and do not provide outside parties with legal rights.  
Rockwell Int'l Corp., B-261953.2, B-261953.6, Nov. 22, 1995, 96-1 CPD  para.  
34 at 13 n.16.  Instead, our review focuses not on the Air Force's 
internal definitions but on whether the evaluations at issue are 
consistent with the RFP's evaluation scheme.  Loral Aeronutronic, 
B-259857.2, B-259858.2, July 5, 1995, 95-2 CPD  para.  213 at 9-10; 
Sabreliner Corp., B-242023, B-242023.2, Mar. 25, 1991, 91-1 CPD  para.  326 
at 12 n.16.

Here, section M.3.1.1 of the RFP advised offerors that the agency 
would consider numerous elements of the proposal's manufacturing 
management program and its quality system.  We have reviewed Tracor's 
evaluation under this subfactor and the record clearly shows that 
several strengths are identified.  In addition, the presence of these 
strengths reasonably supports the distinction between Tracor's and 
Symetrics's proposals.  Under these circumstances, we have no basis to 
conclude that the evaluation here was improper.  Moreover, there is no 
requirement that an agency view as exceptional a proposal for which 
the evaluators have identified a strength and no significant 
weaknesses, nor is this result mandated by the evaluation 
guidelines.[6]  The difference between the assessment that a proposal 
is acceptable rather than exceptional is a matter of judgment that we 
will not disturb without a showing that the agency's application of 
the ratings was unreasonable or unequal in some way.  

In a similar vein, Symetrics argues that the Air Force failed to hold 
meaningful discussions because the agency violated its own internal 
regulatory guidance about discussions.  In particular, Symetrics 
argues it was not given a clear indication during discussions that the 
agency was considering assessing a moderate risk against the company's 
proposal under the manufacturing/quality assurance subfactor, and 
under the management factor.[7]  

As stated above, while we will not consider whether the Air Force 
violated its internal guidelines in this area, we will address the 
issue of whether discussions were meaningful.  Our review of the 
adequacy of discussions seeks to ensure that agencies point out 
weaknesses that, unless corrected, would prevent an offeror from 
having a reasonable chance for award.  Ann Riley & Assocs., Ltd., 
B-271741.2, Aug. 7, 1996, 97-1 CPD  para.  120 at 9, recon. denied, 
B-271741.3, Mar. 10, 1997, 97-1 CPD  para.  122.

Here, there is no dispute that while the Air Force did not indicate 
the specific action it was considering based on its concern--i.e., 
assigning a moderate risk rating to the proposal in two areas--the 
factual basis for its ultimate conclusion was clearly raised with the 
protester during discussions.  For example, in the area of labor 
hours, the Air Force asked Symetrics why the labor hours in its cost 
volume did not match those in its technical proposal, and gave the 
company an opportunity to explain the discrepancy.  Given that the 
factual issues that formed the underpinning for the evaluation 
concerns were clearly raised with Symetrics, we conclude that there 
was no violation of the more general requirement to point out all 
weaknesses that prevent an offeror from having a reasonable chance for 
award.  Robbins-Gioia, Inc., B-274318 et al., Dec. 4, 1996, 96-2 CPD  para.  
222 at 16-17.

Finally, Symetrics argues that the source selection statement lacked a 
reasonable basis because the evaluation conclusions upon which it was 
based were in error, because portions of the statement were 
inconsistent with the evaluation conclusions, and because the 
magnitude of the cost/technical tradeoff was obscured by the 
comparison of MPLCC, rather than each offeror's proposed price.

With respect to Symetrics's challenge that the source selection 
statement was based on erroneous evaluation conclusions, our review of 
the record, including the issues discussed above, leads us to conclude 
that the evaluation was reasonable, and thus provided a reasonable 
basis for the SSA's decision.

With respect to Symetrics's contention that portions of the source 
selection statement were inconsistent with the evaluation conclusions, 
we have reviewed each of Symetrics's arguments and we conclude that 
there is no basis to find that the statement was unreasonable.  For 
example, the agency's evaluators concluded that Symetrics's proposal 
posed a moderate risk under the manufacturing/quality assurance 
subfactor because the proposal's "labor hours appear to be low for a 
first time producer of a system of this complexity."  Addendum to 
Proposal Analysis Report, supra, at 14.  In Symetrics's view, there is 
an inconsistency between the conclusion above and the source selection 
statement, which indicates that Symetrics received the moderate risk 
rating because of the "unrealistically low labor hours in [its] cost 
proposal for a first time producer of a system of this complexity."  
Source Selection Statement, supra.  

We disagree.  In our view, there is no meaningful difference between 
the observation made by the evaluators ("hours appear to be low") and 
the statement by the SSA ("unrealistically low labor hours"), and 
nothing about the difference in these two statements leads us to 
conclude that the SSA's conclusions are unsupported by the record.  
Contrary to Symetrics's contentions, the SSA's statement does not mean 
there was an improper or unreasonable cost realism review here.  
Instead, we interpret the SSA's choice of words as within the normal 
range of variation in language.  There is no doubt that the evaluators 
and the SSA are describing the same phenomenon--i.e., that Symetrics's 
proposed labor hours in its technical proposal raised concerns about 
the company's ability to produce the system as claimed, especially 
after the proposed hours were unilaterally lowered in response to a 
discussion question that directed Symetrics to discrepancies in the 
number of labor hours identified in the technical and cost portions of 
its proposal.  Id. at 3.  

Finally, we turn to Symetrics's claim that the magnitude of the 
cost/technical tradeoff was obscured by the SSA's comparison of 
overall life-cycle costs, or MPLCC, rather than each offeror's 
proposed price.  

Section M.4 of the RFP sets forth the process by which the agency 
intended to calculate each offeror's MPLCC.  In essence, the record 
here shows that the calculation of the MPLCC involved adding $58.4 
million to Tracor's and $58.7 million to Symetrics's price.  In 
selecting Tracor, the SSA compares the MPLCC developed for Symetrics 
and Tracor and concludes that "while Tracor's total MPLCC is 1.4 
[percent] higher than [Symetrics's], discounting risk, I consider this 
difference to be insignificant."  Source Selection Statement, supra, 
at 5.

Our review of the record shows that there is, in fact, a 5.4-percent 
difference between the proposal price offered by Symetrics ($18.716 
million) and the price offered by Tracor ($19.771), and that the 
addition of virtually identical total life-cycle costs tends to 
obscure, rather than illuminate, the true cost/technical tradeoff 
performed here.  Although Symetrics raises this issue in its protest, 
the Air Force's approach to evaluating the proposed prices has been 
clear since the beginning of this procurement.  Not only was this 
matter apparent from the face of the solicitation, but it was apparent 
when we reviewed the earlier award decision in Symetrics Indus., Inc., 
supra.  Accordingly, this element of Symetrics's challenge to the 
cost/technical tradeoff is untimely.  4 C.F.R.  sec.  21.2(a)(1) (1998).  

The protest is denied.

Comptroller General
of the United States

1. The appropriate method for procuring these items--after procuring 
them since 1988 on a sole-source basis from Tracor, the original 
equipment manufacturer--has been in dispute for several years.  A 
recitation of the earlier controversies surrounding this procurement 
is found in our decision in Datacom, Inc.--Protests and Request for 
Costs, B-274175 et al., Nov. 25, 1996, 96-2 CPD  para.  199 at 2-4.  In 
addition, after our decision sustaining Symetrics's challenge to the 
earlier selection of Tracor for award, Symetrics and another offeror, 
Varo, LLC, challenged the revised solicitation.  After mediation of 
the dispute by our Office, the Air Force agreed to amend the 
solicitation.  In response, Symetrics withdrew its protest, and Varo's 
protest was dismissed as academic.  Symetrics Indus., Inc., 
B-274246.6, Nov. 19, 1997; Varo LLC, B-274246.8, Nov. 19, 1997.

2. The color/adjectival ratings used in the evaluation were 
blue/exceptional, green/acceptable, yellow/marginal, and 
red/unacceptable.  Proposal risk was rated high, moderate or low, and 
was defined as the risks identified in an offeror's proposed approach.  
Performance risk was rated high, moderate, low, or not applicable, and 
was defined as an assessment of the offeror's present and past work 
record to gauge confidence in the offeror's ability to successfully 
perform as proposed.

3. The SSA also concluded that the third offeror, whose MPLCC was 
higher than Tracor's, offered the government no additional benefit 
commensurate with its higher long-term cost.  

4. We note, however, that one of the two articles cited by Symetrics 
appears under the heading "Unconventional Wisdom," which suggests that 
the Air Force's view of the benefits of Tracor's Six Sigma Program is 
squarely within the mainstream of conventional thought on this issue.

5. Air Force Federal Acquisition Regulation Supplement (AFFARS), 
Appendix BB  sec.  BB-304.  In contrast, a green (acceptable) rating is 
defined as "[m]eets evaluation standards and any weaknesses are 
readily corrected."  Id.

6. In fact, even if we were to consider Symetrics's challenge to the 
application of the color rating scheme, Symetrics's argument is based 
on an unreasonably narrow reading of the definitions in the scheme.

7. Again, Symetrics's argument is based on a provision in Appendix BB 
of the AFFARS which requires that the agency prepare significant 
clarification requests (SCR) whenever a performance risk assessment of 
moderate or high is made in evaluating an offeror.  AFFARS  sec.  
BB-307(a)(1).  In the event that the agency establishes a competitive 
range, these SCRs are to be provided to the offeror during 
discussions, on the same basis as deficiency reports.  AFFARS  sec.  
BB-307(a), (b).