Inherent Moral Hazards in Acquisition: Improving Contractor Cooperation in Government as the Integrator (GATI) Programs

Abstract

In the Government as the Integrator (GATI) model of acquisition, prime contractors no longer hand-select the members of the acquisition team or consortium, as they often did in the Lead System Integrator (LSI) model. One drawback of GATI acquisitions, thus, is that independent contractors may have little incentive to cooperate by sharing data and supporting other contractors, potentially resulting in delays, overruns, and poor performance. These problems are considered in this work to be both breakdowns in cooperation and expressions of moral hazards. Since the need for cooperation among contractors is still critical to success, finding ways to motivate that cooperation to improve program performance and outcomes is key to effective GATI acquisition. In this research, potential incentive mechanisms were analyzed for their ability to promote cooperation by applying game theory framing and analysis to this GATI acquisition context, and using system dynamics and agent-based modeling to study the results for their ability to promote cooperation and improve program outcomes.