Contract Management: Benefits of the DOD Mentor-Protege Program Are Not Conclusive

A letter report issued by the General Accounting Office with an abstract that begins "Congress authorized the Pilot Mentor Protege Program to boost the participation of small disadvantaged businesses as subcontractors and suppliers under Department of Defense (DOD) contracts. The program provides incentives for major defense contractors (mentors) to assist small disadvantaged businesses (proteges) in strengthening their ability to compete for work. However, DOD has been criticized for not establishing compelling evidence about the program's overall effectiveness. This report reviews (1) the relationship between the results of the Mentor-Protege Program and the statutory goal of awarding five percent of the total dollar amount contracted by DOD and subcontracted by DOD prime contractors to small disadvantaged businesses; (2) whether the Mentor-Protege Program enhanced the business competitiveness, financial independence, and business development of protege firms; and (3) whether program funds had been used as an effective incentive for mentor firms to participate in the program. GAO found that DOD lacks data integral to assessing the success of the Mentor-Protege Program. DOD lacks enough information to determine the relationship between the program and the goal of awarding five percent of the total dollar amount contracted to small disadvantaged businesses. Although DOD has consistently achieved this goal since 1992, the program's overall contribution to this goal is unknown. DOD also lacks sufficient information to assess whether the program enhanced the business competitiveness, financial independence, and business development of protege firms. Although there are small disadvantaged business program participants that have become more successful, data is not available to attribute their success to the program. Program funds have been used to encourage major defense contractors to provide developmental assistance for small disadvantaged businesses. However, data is not available to determine whether program funds are needed to continue to encourage major defense contractors to establish business relationships with small disadvantaged businesses.