Reports on Government-wide Policy

2012-02-03T16:01:00.002-05:00

IT acquisition: Pay less now, more later

Given the current budget environment, in which even essential programs are under scrutiny, it's only natural that agencies are pressuring their acquisition teams to put the squeeze on vendors for the best possible price. Unfortunately, they might get that price only to find out later that the joke is on them.

Experts increasingly fear that officials will develop a “lowest cost technically acceptable” attitude for their procurements. In other words, they will pick the bids that meet the minimal requirements and go for the cheapest price to demonstrate to the higher-ups that they are good stewards of the government’s money.

The result could be abysmal performance.

“Think performance is bad now? Wait,” said Jaime Gracia, president and CEO of Seville Government Consulting, a federal acquisition and program management consulting firm. “Soon, these jokers will come in to start work and they’ll be like the Three Stooges.”

In some cases, experts say, the lowest bid could actually end up costing agencies more as they eat up all the savings — and more — with make-good work.

“Suddenly, the lowest cost technically acceptable isn’t the lowest cost,” said Robert Burton, former deputy administrator at the Office of Federal Procurement Policy.

But several factors work against buying the best value, which weighs both cost and quality. One problem is timing: Investing in quality might not pay off right away, which could frustrate Obama administration officials who are eager to show that they are running the government efficiently.

Another problem is that best value is inherently subjective. Buyers must factor in the probability of success and the associated risks — both of which elude hard analysis — against any differences in cost. In contrast, when success is measured on price alone, it's easier to set goals and measure progress against them. You can just watch that bottom line.

Those difficulties are compounded by the fact that shrinking budgets also mean acquisition officials are getting less support from contractors. In the past, contractors have often helped with market research and other important tasks that can help justify higher bids.

Dan Gordon, who recently stepped down as OFPP administrator, offers a more tempered view. There are times when the lowest cost is fine, he said. But on more complicated procurements, the best value deserves a close look, too.

He said he is confident that the federal acquisition workforce has the training and experience to navigate those choices. They know they are “entrusted with the discretion to find the way to best protect taxpayers’ dollars,” Gordon said.

But others are less optimistic. Larry Allen, president of Allen Federal Business Partners, said he believes the low-cost mentality might have already taken hold in some parts of the government, such as the Defense Department.
The Three Stooges just might be arriving with a "fleet of Yugos," Allen said.

Read the story on FCW.com - IT acqusition: Pay less now, more later

2012-01-16T11:32:00.000-05:00

Reverse auctions:
A bid for budget-conscious business

It’s like an auction, except instead of bidding to buy products, companies are bidding to sell them

Sometimes a good idea gets even better with the passage of time.

Ten years ago, shaving nearly 15 percent off the cost of a procurement by using a novel approach to the bidding process was a good idea. A decade later, as agencies across the government are seeing programs cut and discretionary funding dry up, it seems like a great idea.

In 2002, Cathy Read, director of acquisitions management at the State Department, gathered her most forward-thinking contracting specialists — the ones who “were always looking for a better way to save money and do it faster” — and asked them to try a new approach to buying commercial IT products.

Rather than soliciting quotes from companies and then picking the one with the best value, the department invited companies to bid against one another, driving the price lower and lower until one bidder emerged as the winner. It’s like an auction, except instead of bidding to buy products, companies are bidding to sell them — hence the name “reverse auction.”

The approach has paid off. State officials estimate they saved $33 million on more than 3,000 purchases in fiscal 2011, based on an independent government estimate. That’s a savings of more than 14 percent.

Proponents say other agencies could achieve similar savings, for a governmentwide total of billions of dollars a year. Given the current budget crisis, those experts say reverse auctions deserve a closer look.
“You can’t always do things the way you’ve always done them,” Read said. “You have to be lean on your feet, and you have to make do with what you have.”

Start small, think big

Reverse auctions are appealing because it’s easy to test the approach and see immediate savings — and imagine how much more savings they could bring to bigger projects.

In the beginning, Read had State auction off a few items to test the new method, and when she consistently found that the approach was saving money, she turned to reverse auctions more often over the years and with a wider array of commodities.

As time went on, the savings continued to increase and the competition for solicitations improved.

Even the department’s inspector general took note of the savings from reverse auctions in a report on spending under the American Recovery and Reinvestment Act of 2009. After reviewing a $13 million program to replace desktop workstations, the IG estimated that the reverse-auction approach had saved the department 7 percent, with greater savings being seen on other projects.

David Wyld, professor of management at Southeastern Louisiana University, has done extensive research into the benefits of reverse auctions. He has determined that $74.5 billion in federal acquisitions could be competed through reverse auctions, and his analysis of auctions conducted across the government demonstrated a savings of 11.9 percent. That means the auctions could bring an annual savings of $8.9 billion across the federal government, with $6.1 billion saved on Defense Department spending alone.

“To me, the real-world benefit is the cliché ‘faster, better, cheaper’ way of doing business,” said Wyld, whose findings were published by the IBM Center for the Business of Government in a report titled “Reverse Auctioning: Saving Money and Increasing Transparency.”

Saving more than money

However, this isn’t just about saving money.

Time is an equally precious commodity in government offices, and many federal officials and acquisition experts say the acquisition workforce doesn’t have enough hours in a day to do all that it needs to do. Both Wyld and Read said reverse auctions save employees the non-renewable resource of time.

Wyld studied how much time State saved by using reverse auctions and found that the department shaved off nearly a full workday from each procurement it conducted using reverse auctions. Specifically, the department saved an average of 475 minutes — or 7.92 hours — whenever it conducted an acquisition through reverse auctions rather than traditional procurement methods.

“If you’re going to be a buying shop today when budgets are being cut by 15 to 20 percent because money is an issue, then as a buyer, you have to look for better, faster, more creative ways to get your program office what it needs,” Read said.

Agency officials must consider tools like reverse auctions or they won’t be able to adjust to the ongoing need to reduce the cost of government operations, she added.

Nevertheless, the auctions are not simply a way to save a little time and money here and there. The approach also streamlines the negotiation process. Reverse auctions simplify communication and collaboration between buyers and sellers, Wyld wrote in his report. “The competitive bidding processes that took weeks or even months to complete can be compressed into days or even hours,” he said.

All those factors help increase competition and bring agencies closer to the true fair-market value of a purchase. State’s IG wrote that reverse auctions “have been found to be significantly less expensive per item than buying the items from comparable General Services Administration schedules.”

The flip side of reverse auctions

Reverse auctions do have their limitations. For one thing, “the expedited form of procurement won’t work without oversight,” said Robert Burton, former deputy administrator of the Office of Federal Procurement Policy (OFPP) and now a partner at Venable law firm.

Furthermore, procurement offices cannot turn over all solicitations to reverse auctions. The approach only works when the terms of the contract are clearly defined and there is little — or no — room for flexibility. In other words, it is best for common products. Burton warned against buying services through a reverse auction because such contracts have far too many variables.

However, Read said she believed it was possible to buy certain basic services through reverse auctions.
Furthermore, Wyld said the auctions could change the nature of the relationship between buyers and suppliers. Instead of establishing long-term partnerships, relationships might only last until the next competition. The potential for switching suppliers is a cost of doing business, and for basic items, it won’t matter much, he said.

“Copy paper is copy paper,” Wyld said. “Toilet paper is toilet paper.”

However, a reverse auction also might affect the dynamic between buyers and suppliers, with the suppliers feeling coerced into lowering their prices in order to join an auction, Wyld wrote.
Jaime Gracia, president and CEO of Seville Government Consulting, said the reduction in procurement spending has the potential to make competition fierce, which, in turn, forces companies to lower their prices to win contracts.

To succeed with reverse auctions, Gracia said agency officials must determine which procurements are appropriate for reverse auctions — and which are not — and they must make sure that those solicitations have very clear requirements.

Making the case for innovation

Experts say now is the time to sell agencies on reverse auctioning because senior officials are desperate to find ways to conserve their resources.

“Agencies are looking under trees and in the couch for any spare change,” Gracia said.

OFPP has issued memos calling for agencies to use innovative procurement tools, including reverse auctions. Recently Dan Gordon, outgoing OFPP administrator, urged agencies to consider the approach.

To make the case to their bosses, Read said procurement officials should start small and document the results. From the beginning, she kept detailed notes on the reverse auctions that State conducted. She can cite dollar amounts, volumes and percentages by fiscal year.
“You can see the metrics are very important to really understand if we have savings and success,” she said.

However, she said that although innovative contracting specialists will likely embrace reverse auctions, instituting the approach agencywide will take time. “Change management issues in a federal government agency are always a bit of a challenge,” Read said.

Wyld, too, said reverse auctions should be implemented with care. However, he added, “hill by hill, staffer by staffer, people will change after hearing firsthand stories of savings.”

Read the story: FCW.com - Reverse auctions: A bid for budget-conscious business

Short tenures at OFPP hurt acquisition initiatives

2011-11-02T20:45:00.000-04:00

Experts say a short tenure has

a tendency to stall initiatives

The Office of Federal Procurement Policy is losing another administrator relatively soon after his confirmation, which may be an impediment to advancing policies, according to one former OFPP official.

Since the late 1990s, administrators have stayed at OFPP for roughly two years. Steve Kelman was the last administrator to stay at OFPP for longer than that, from 1993 to 1997. Kelman is now a Harvard University professor and columnist for Federal Computer Week.

Dan Gordon, the current administrator, will leave at the end of the year for the George Washington University law school, where he will be associate dean of government procurement law studies.

When he leaves his office for the final time, he will have been administrator for about 25 months. Gordon was confirmed in November 2009.

A result of such short terms as administrator is that the office staff is pulled away from their inherently governmental functions of working on governmentwide procurement policies that affect agencies and industry.

“Unfortunately, the news of Dan leaving is that it disrupts the office and the focus on current initiatives,” said Robert Burton, former deputy OFPP administrator, who spent several years in the 2000s as acting administrator. He now is a partner at the Venable law firm.

Confirmation process

As Gordon leaves, the Barack Obama administration will once again have to find a suitable nominee. Once the next nominee is chosen, the White House staff will have to prepare the nominee for the Senate confirmation hearings, along with a crash course in the ongoing initiatives.

“It’s a lot of work,” Burton said.

While that's disruptive enough, Burton said it's also difficult for the office when leaders come and go so frequently. Consistent leadership is good to have, but hard to attain under those circumstances. And it's detrimental to the office-holder himself, Burton added, because accomplishing anything of note in just a couple of years in office is unlikely.

Gordon, however, was one who did manage to make some progress on initiatives during a brief tenure, Burton said.

Gordon's initiatives

One of his most significant initiatives was that Gordon worked to rebuild the federal acquisition workforce.

He gathered support to provide funding for more employee training, and he updated the certification standards for contracting officers. Gordon's reforms also increased training standards for contracting officer's representatives and program managers, both of which are considered part of the acquisition workforce.

Gordon also pushed agencies to think strategically when buying commodities. He encouraged strategic sourcing and getting agencies to take advantage of the government’s size.

“We are—finally—leveraging the federal government’s purchasing power as the world’s largest customer to deliver a better value for the American taxpayers,” Jacob Lew, director of the Office of Management and Budget, wrote on the OMBlog Nov. 2.

Gordon also brought attention to innovative methods to purchasing, such as electronic reverse auctions and interagency contracting.

The listening ear, the reasoned mind

In addition, Gordon was someone that government officials and industry leaders felt like they could talk to.

“Perhaps his most important contribution was his tireless efforts to bring open, reasoned debate and discussion back to federal acquisition,” said Stan Soloway, president and CEO of the Professional Services Council.

Gordon sought to mitigate the hyperbole and rhetoric of the procurement world with a Myth-Busters Campaign, Soloway said.

Steve Schooner, a procurement law professor at the George Washington University law school, said Gordon deserves a lot of credit for reviving the Front Line Forum, which was instituted by Kelman and had largely fallen away in recent years.

The forum let the procurement policy leaders hear from the workers dealing daily with government purchasing.

“It's hard to quantify how important this outreach is—not just engaging with the operational community, but actually listening to the concerns and suggestions and aspirations of the people upon whom the entire process depends,” Schooner said.

He said he’s hopeful that future OFPP administrators will recognize the importance of being “the acquisition workforce’s cheerleader-in-chief.”

Schooner said a major difference between Gordon and Kelman is the workforce. Kelman faced trend in the 1990s to decrease the size of the acquisition workforce, which he could not stop. Gordon inherited a far more starved acquisition workforce. One of his high-profile initiatives was rebuilding the workforce, and he had kept it on everyone’s radar screen.

It will be “one that will pay dividends to the government and the taxpayers for years to come,” Schooner said.

Kelman too said the government will benefit from the emphasis on the workforce.

“Dan did a good job fighting for increasing the numbers in the depleted contracting workforce,” he said.

What the next administrator needs

As the search will begin for the next administrator, the nominee needs the know-how understand the procurement world and the skills to see what in that world needs attention, experts say. Decisions and policy initiatives have far-reaching effects, such as rebuilding the acquisition workforce and insourcing government work.

Burton said it’s a very technical field and not merely a management position.

“And with only two years, you don’t want to spend the first six months helping the new administrator understand the Federal Acquisition Regulation, he said.

Gordon brought significant expertise from his 17-year stint at the Government Accountability Office, where he served in several legal roles, finishing as acting general counsel.

“Dan has brought a mixture of great substantive procurement knowledge and great interpersonal skills to this job—exactly the mix of skills you want in an OFPP administrator,” Kelman said.

Gordon set the bar high for the next political appointee to have technical knowledge, according to experts.

And so the search for a new administrator begins.

Read the story: FCW.com - Short tenures at OFPP hurt acquisition initiatives

DHS requires 'Hi, I'm a contractor' intro

2011-11-01T21:55:00.028-04:00

Could the requirement undermine the teamwork
that's essential in a workforce?

Homeland Security Department officials want to draw a bright and shiny line between the two teams that work inside a federal department: the federal employees and the contractors.

Under DHS’ FirstSource II draft request for proposals, officials are telling contractor employees to announce in all interactions that they are not federal employees but are, instead, contractors.

For example, contractor employees must introduce themselves, in person and in voicemails, as employees of their companies. They cannot try to elide the difference by saying they work for DHS. And if they're employed by a subcontractor, they have to identify the company, not say they are employees of their prime contractor.

And federal Homeland Security Department officials—not to be confused with contractors—are suggestion that these announcements aren’t something for people to laugh about over lunch.

“Failure to adhere to this requirement may constitute grounds for termination for default of the base FirstSource II contract,” the draft states. Serious stuff.

The Defense Department has a similar rule. Contractors must announce, wherever they go, that they are contractor, not a federal employee. Officials instituted the rule in 2010.

The “Hi, I’m a contractor” rule may show who’s who in a conversation or meeting. But it won’t help in blending the workforce, some readers have said.

Contractors fear that the rule could undermine the teamwork that’s essential in that type of workforce.

“How do you maintain unity of community when segregation is forced?” a reader asked.

Read the Acquisitive Mind blog: FCW.com - DHS requires 'Hi, I'm a contractor' introduction

Surviving the Darwinian world of federal contracting

2011-10-14T09:20:00.006-04:00

Federal programs aimed at aiding the growth of small businesses through federal contracting are not a good investment if they simply set up those firms to fail, some experts say.

The problem is that when small businesses become midsize businesses, they lose access to set-aside contracting programs and end up struggling to survive in the eat-or-be-eaten world of federal contracting. Some firms find a way to get by, but others end up selling out to bigger competitors.

That is not necessarily a good return on the federal government's investment. But help might be on the way.

Rep. Gerry Connolly (D-Va.), who has many IT contractors in his district, is pushing a pilot program to help ease newly graduated small businesses into full-and-open competitions against the biggest contractors.

In his plan, only the General Services Administration could award contracts through the set-aside program. As important, the midtier company could win a set-aside contract only if GSA officials believe a small business likely would not have received it. In addition, the midtier company must mentor a smaller company.

Connolly’s goal is to continue helping the once-small contractors that the government has invested in and nurtured through the years after they become midtier competitors.

He said he questioned the benefit to taxpayers if small companies are sent “into a Darwinian world where they are, on Day One, expected to compete with the big guys.”

Others have reached a similar conclusion — and have come up with their own solutions.

At a hearing Sept. 14, Rep. Nydia Velázquez (D-N.Y.), ranking member of the Small Business Committee, pointed out that GSA already has the Business Breakthrough program, which prepares small companies for the next level.

The program is available to a range of companies, and officials envision it being particularly useful to companies that are too large to qualify for small-business advantages but not large enough to successfully compete with the nation’s largest corporations. It's just want Connolly wants with his proposal.

GSA also has its mentor/protégé program. There are 81 active agreements between businesses of all sorts, from large companies to a variety of small-business types. The agreements can result in lasting business relationships and prepare the smaller firms to enter the bigger market.

Any of those programs might help, but only if federal agencies are willing to support them.

However, one industry executive said that for the most part, agencies aren’t looking beyond the small-business credit.

“No matter how well a small business does in support of an agency, it seems that once that business has outgrown the specific small-business program, the agency just turns to the next small business for support,” said Randy Slager, CEO of Catapult Technology, a mentor in GSA’s program.

Without a diversified set of customer agencies, a newly minted midtier company can quickly lose its customer base — a major factor in the high rate of failure among small businesses, he said.

Bill Jaffe, senior vice president and general manager of Tape, a service-disabled veteran-owned/woman-owned small engineering firm, said the 8-year-old company will cross the threshold into the full-and-open competition marketplace by December, and he’s going to face off for work against the Lockheed Martins and Northrop Grummans of the world.

“Companies do go through the process and survive,” Jaffe said, “but many of them do not survive.”

He is one of the leaders of a new industry group called Mid-Tier Advocacy that seeks to support such companies in a tightening market. But overall, it’s the company’s responsibility, Slager said. Businesses must plan and strategize well before the growth begins.

“I don’t think that this is a factor that is government-dependent,” Slager said. “It rests with the senior management of the small business.”

Another businessman has a different idea: Why make growth the main goal in the first place?

A reader calling himself Stay-Still-Stan recently commented on an “Acquisitive Mind” blog post by advising his peers to bask in the small-business perks. Most government contracting companies, including his own, strive to grow but are rarely happy when they do, he wrote.

His advice? “To be most profitable, government contractor: Find a niche, become the best, be a ‘disadvantaged’ company for special perks, stay not-for-profit and employee-owned, and keep company size under one of the government-defined limits to minimize the paperwork you need to do,” he wrote. “Do this, and everyone in the company will retire quite wealthy and happily.”

Read the rest of the story: FCW.com - A new push to rethink the small-biz contracting payoff

The ghost of small businesses past

2011-09-29T11:24:00.009-04:00

In June, many agencies proudly tweeted that they had received an A from the Small Business Administration because they did such a good job of awarding contracts to small companies in fiscal 2010.

And although SBA shared their enthusiasm, many critics say the recognition is unfounded because the program is fundamentally flawed.

The government awarded nearly $98 billion in federal contracts to small businesses last year, or 22.7 percent of eligible contracting dollars, according to SBA. The goal was 23 percent. It was the second year in a row that the money going to small businesses went up, and it was the largest two-year increase in more than a decade.

“We’re obviously excited about the progress we’ve made,” said Joe Jordan, associate administrator of government contracting and business development at SBA, during a conference call June 23, the day before the score cards were released.

Ten of the 24 agencies that SBA evaluated received a higher grade in 2010 than they did in 2009, while 10 agencies’ grades stayed the same. SBA gave 13 As, five Bs, four Cs and two Ds. SBA received a B, as did the government as a whole.

However, many experts say the grades aren’t accurate because the businesses that are winning the contracts often aren’t small.

Agencies routinely get credit for awarding contracts to small businesses that have outgrown that status or been bought by large corporations. Therefore, in many cases, a small business is no longer doing the work.

So are the scores correct?

“I think the answer is no,” said Sen. Rob Portman (R-Ohio), ranking member of the Homeland Security and Governmental Affairs Committee’s Contracting Oversight Subcommittee.

Likewise, Sen. Claire McCaskill (D-Mo.), the subcommittee’s chairwoman, went so far as to call the 23 percent small-business goal “an empty achievement.”

She told Jordan during a recent hearing that “by taking the position you’re taking, you’re essentially saying to the public, ‘By the way, we’re saying 22.7, but don’t believe it.’”

However,Jordan said agencies are doing exactly what the program was designed to help them do: Award contracts to small businesses and watch the companies grow big.

Federal rules allow a company to maintain its small status for as long as five years before it must recertify its size. At that point, any small-business contracts it holds either maintain their classification or are reclassified based on the company’s new status.

That approach is an improvement, Jordan said. The policy used to be “once a small-business contract, always a small-business contract.” It didn’t matter who bought the company or how large it grew.

Nevertheless, some acquisition experts see the issue as Portman and McCaskill do. And they see the scoring as shady.

Sure, the program follows the rules and might be technically correct, said Jaime Gracia, president and CEO of Seville Government Consulting, a federal acquisition and program management consulting firm. But there’s plenty of room for tougher standards and clarity about a company’s size.

He said federal officials should require companies to certify their size every year to get a true picture of small-business contracting. That’s not happening now, which means “SBA is asleep at the switch,” Gracia said.

Guy Timberlake, co-founder and chief visionary officer at the American Small Business Coalition, said there should be changes in how agencies set aside contracts and how officials oversee them. And the government must enforce size standards so that small companies can reap the benefits.

He said a program that encourages subcontracting with small companies would help. When a small business that holds a set-aside contract grows too large, it should award a certain percentage of subcontracts to small firms for each upcoming option year of the contract. Agencies should make that expectation clear when they award the set-aside contracts and get a firm commitment from the companies.

Without such changes, “doing business as a true small business in the federal sector will continue to be — at least in part — an aggravating exercise,” Timberlake said.

Read the story: FCW.com - The ghost of small businesses past

Hey, small business, ready to leave the 8(a) world?

2010-11-26T06:00:00.002-05:00

To survive graduation, small businesses need to prepare for tougher competition

Kathy Carrier’s office overlooks the Eagle Marsh Woods, a 41-acre nature preserve in Fort Wayne, Ind. The woods are home to all sorts of birds and animals, such as the black-crowned night heron and blue-spotted salamander.

But there’s another preserve that Carrier, president and CEO of Briljent LLC, and other small-business executives like her are overlooking. It’s home to ferocious other-than-small businesses and corporations. Her company is ranked No. 15 on Washington Technology's 2010 list of the top 25 8(a) small businesses. The list ranks the most successful 8(a) small businesses according to their overall government contracts.

“We’re going into the lion’s den,” said Paresh Ghelani, CEO of 2020 Company LLC, ranked No. 10 on the list. “And I would be lying if I said it doesn’t make me nervous.”

Briljent and 2020 Company, both professional services contractors, are graduating from the Small Business Administration’s 8(a) Business Development Program within a year. From there, they head from the protected world of small-business set-aside contracts into the wild world of full-time, full-and-open competitions with other companies, including the biggest government contractors.

While in the 8(a) program, they’ve done all they could to prepare for their launch into the full-and-open world. They have set up strong business infrastructures, such as accounting systems that meet government standards and company ethics rules, and they’ve received numerous certifications to meet federal regulations. Further, they’ve hired employees who know the ropes of the federal procurement system, and they worked to develop relationships throughout the contracting community.

“We spent so much time and money, I was hell-bent on getting a contract,” Carrier said. And the Centers for Medicare and Medicaid Services awarded Briljent its first contract, which was worth $139 million.

SBA’s 8(a) program helps socially and economically disadvantaged small businesses gain access to federal contracts. To participate, firms must be at least 51 percent owned and controlled by someone who meets the criteria of being disadvantaged. The firms must also qualify as small businesses. Once certified, 8(a) firms are eligible to receive sole-source and set-aside contracts of various sizes for as long as nine years.

To succeed in the program, company executives had to do much more than get a contract. They had to look into the heart of their firms. Executives repeatedly emphasized that companies must live by a certain creed to prepare for what’s ahead for growing small companies.

A small business cannot think of itself as small, experts say. Instead, its leadership needs to present the company as what it intends to become next: a successful, midtier business.

For instance, a company needs to be flexible like only small ones can be but move forward with a different frame of mind.

“You’ve got to be nimble like you’re small but act like you’re big,” Ghelani said.

Leading firms also said 8(a) companies should not live on 8(a) set-asides alone. Companies must stretch beyond SBA’s program before they even leave the program. They must prove to themselves and the agencies and prime contractors that they will be dealing with that they can survive in the lion’s den.

However, many 8(a) companies see dollar signs and contracts galore because they’re in the program, experts say. But that thinking will be their downfall. Businesses need to work hard to get contracts, even if they’re competing for contracts that are set aside only for small businesses.

Consequently, some companies give up when they’re hit with the reality of how much work goes into winning a contract, or they simply take in no extra business, many executives say.

“It’s not welfare; you’ve got to work,” said Pete Von Jess, owner and CEO of USfalcon Inc., a national security company, ranked No. 3 on this year's list.

To help with the work, companies ask employees to canvass the community, develop partnerships and relationships, and learn about that marketplace. Business development is at the core of earning contracts. Companies need to play all sides by talking to people inside agencies that are potential customers. And they should also scout prime contractors to find companies that are in need of particular services.

While building potential business relationships, a small business needs to find its niche.

When Ghelani was developing those partnerships and seeking opportunities, “we simply said we can add value,” he said.

The program does its part by attempting to match small businesses with big companies that can help them survive in the bigger and tougher contracting world.

“It’s a marriage, but it’s a marriage that is not going to last forever,” said Von Jess, a retired Army colonel.

While reaching out to mentors, small businesses should not forget about their own. Businesses can join with other small businesses in joint ventures and other teaming arrangements to get larger contracts, such as the National Institutes of Health’s Chief Information Officer Solutions and Partners 3 governmentwide acquisition contract. The indefinite-delivery, indefinite-quantity IT GWAC will have a set-aside for small businesses.

Jess put the canvassing into perspective.

Developing business doesn’t mean simply going out to lunch with a few clients, he said. “It means swapping invoices.”

With their relationships, new companies should tap into their customers' and partners’ knowledge and experience to learn more about the complexities of the procurement world and its many continual legislative and regulatory changes.

“A major roadblock for us is our own ignorance,” Carrier said. “We didn’t know what we didn’t know.”

In the past two years, Congress and the Obama administration have changed many parts of small-business contracting. A new law, signed in September, might allay concerns that prime contractors won't stick to their subcontracting plans and send business to their small partners.

Some executives have a less optimistic view on those changes. First, the changes are not likely to concern small businesses for several years. They said the regulatory process is slow. Second, some experts say any oversight changes largely depend on how well and tenaciously federal officials enforce the programs and regulations.

As successful small businesses leave the program, they are moving into a tough world that is already feeling pressure on both sides. Executives at midtier companies have said they are stuck between small businesses and big corporations, two strong and growing forces in the marketplace.

But leading 8(a) companies are striding proudly into the middle. One of the Top 25 8(a) companies, which graduated from the program in March, turned down an interview request because, as a spokesman said, it didn’t want to be seen as a small business any longer. It had instead turned its attention to the issues that midtier companies are dealing with and was done with the past.

Despite competition and other pressures, many small-business owners are not afraid to go to the next level.

Carrier’s Briljent is prepared to leave the small-business nature preserve for a harsher world.

“We’ve had significant federal work,” she said. “The program worked.”

Read the story: Washington Technology - Hey, small business, ready to leave the 8(a) world?

GSA acquisition team gets down to business

2010-11-22T06:00:00.002-05:00

Steve Kempf wants FAS to be the No. 1 brand in acquisition

Some agency leaders can inspire employees with a vision of the future and motivate them to work hard to achieve it. Those leaders enter as if they rode in on a white stallion.

Other leaders arrive on a workhorse. They aren’t hailed with cheers or thunderous applause. Instead, they make people realize that it’s time to get down to business.

Steve Kempf has been commissioner of the General Services Administration’s Federal Acquisition Service since July, and he arrived leading a workhorse. In an interview before taking on that role, Kempf said his strategy “will largely be in the context of this administration, GSA’s current thinking and then finally where FAS wants to take the [Multiple Award] Schedules program.”

Kempf gave his first speech as commissioner Nov. 2 at the Coalition for Government Procurement’s annual Fall Conference. The gathering lacked an atmosphere of excitement or lavish praise for Kempf.

“He’s not making a lot of waves, and there are no big steps,” said John Howell, a partner at the Sullivan and Worcester law firm, after the speech.

It seems that the leaders on white stallions are already here and have cast their grand visions. Kempf specifically referenced Obama administration officials “who see GSA as an asset” and GSA Administrator Martha Johnson. Johnson has enthused GSA employees since 2009 with her vision of customer intimacy, innovation and operational excellence.

Kempf’s vision is simple, and it’s about work. “It’s very important for us to meet our obligations and our commitments” to make FAS the No. 1 brand, he said.

He said that in the next decade, FAS will become agencies’ first choice when they need to make a purchase because FAS will offer easy-to-use tools, fast service and a wealth of options.

Kempf is moving ahead on many fronts by taking the infrastructure that was already in place and making it work. He is launching new Web-based tools, including eOffer/eMod, which allows companies to electronically submit new offers and requested modifications to their schedule contracts. Early in 2011, GSA officials plan to enable government customers to manage their contracts online with such tools.

Kempf also said he recognizes the growing importance of data in this era of transparency. He said FAS customers need to have easy access to data about sales and pricing so they can see whether they’re getting the best deal for their money. And he plans to get that information for them.

A Knack for Getting Things Done

Roger Waldron, new president of the Coalition for Government Procurement and a retired GSA official, said Kempf is working on projects that started during Waldron’s tenure at the agency.

“He’s carrying them to fruition,” Waldron said, adding that the projects are important building blocks.

Although Kempf is not making waves, Howell and others are quick to say he was a good choice for FAS commissioner.

A GSA employee who attended the conference said Kempf knows FAS well. He joined GSA in 1992 as a marketing coordinator at the Office of Technology Assistance and has since held leadership positions at the Federal Systems Integration and Management Center, the Office of Integrated Technology Services and FAS.

Kempf knows FAS' challenges because he has been on the front lines for years and has worked on the operational and strategic sides, said the employee, who spoke on condition of anonymity.

The employee added that Kempf couples experience with research. Kempf marshals his resources well and can often point employees to research that is relevant to their particular projects.

Kempf’s success as FAS commissioner will likely center on collecting more data about pricing and transparency. He will also be a leader in the emerging world of green procurement, the employee said.

Furthermore, Kempf is down to earth and doesn’t think of himself as above everyone else. “He’s not in an ivory tower or on a high horse,” the employee said.

Read the story: FCW.com - GSA acquisition team gets down to business

DOD drives deeper wedge between feds and contractors

2010-11-10T12:11:00.000-05:00

Defense contractors worry about maintaining the delicate balance of the federal workforce

Federal employees probably wouldn't be surprised to see a contractor arrive at the office in an orange jumpsuit. Nor would a contractor blink if feds were to show up in Tommy Bahama shirts from the new Tropical Temptation collection.

The outfits would match the image that each holds of the other: Contractors are greedy enough to shoot their mother for a dollar, and feds treat work like a day at the beach.

As funny as those old stereotypes might sound, they reflect the often-bitter cultural divide between contractors and feds that, depending on whom you ask, is about to get wider.

Under a Defense Department rule that went into effect in September, contractor employees are required to identify themselves as such in all forms of communications, whether in person, on the phone or in e-mail messages.

At a time when contractors outnumber feds in some offices, the rule is intended to ensure that DOD managers do not inadvertently involve contractors in sensitive work that should be set aside for feds. The rule, in short, will show who’s on which side.

But some contractors fear that the rule could undermine the teamwork that's essential in a blended workforce, in which feds and contractors must work side by side on a daily basis. “How do you maintain unity of community when segregation is forced?” a reader named Skully asked in a comment posted at FCW.com.

It’s a tough question, especially given the existing distrust between feds and contractors in many government offices.

Bob Woods, a retired federal official and now president of Topside Consulting, said the rule only exacerbates the situation. Worse yet, it’s not even necessary, because feds know who the contractors are. If not, they’re not being diligent, he said. “The rule creates an awkward situation for everybody,” he said.

Another reader commenting on the story pointed out that the pink badges contractors wear are already pretty conspicuous. The lack of identification is not the problem — it is the “cries of ‘unclean!’ when the contractors pass through federal workspace that is distracting.”

As some contractors see it, DOD might just as well post a scarlet letter on their foreheads, marking them as people whose loyalties are not to the customer or the mission but to the bottom line.

But as touchy as the issue might be, contract employees know who is writing their checks.

“Some people would be very offended by that statement,” but it’s true, said Peter Tuttle, a former Army contracting officer and now senior procurement policy analyst at Distributed Solutions. He also said federal employees need that “healthy bit of skepticism.”

The rule isn’t bad, said Kevin Carroll, retired program executive officer of DOD’s Enterprise Information Systems office and now president of the Kevin Carroll Group, a consulting company. It will let other contractors and officials know whom they’re talking to.

The identity question is especially a problem outside federal offices — where badges are not required —in e-mail, and on the phone.

The lack of identification by contractors “clouds the water on a daily basis and causes delays and delivery of substandard technology and products to the DOD,” a federal employee wrote, adding: “Anyone not seeing this as a problem with the current procurement system is a victim of ‘.mil’ envy.”

There are ways to curtail segregation.

When Carroll worked in government, he included contractors in all of his office’s work and even invited them to social events. Overall, he tried to make them teammates. Over time, contractors usually became more loyal to the office than their companies, he said.

“It is just a matter of leadership and inclusion, with a careful eye on preventing conflicts within the workplace,” Carroll said.

Likewise, the mutual stereotypes need not be a problem.

Many people are good workers, and managers need to attend first to the motivated people in the office, Woods said. Then managers should deal separately with the select few who match the contractor and federal employee stereotypes. They'll soon find their motivated employees will want the unproductive people out of the office.

Read the story: FCW.com DOD drives deeper wedge between feds and contractors

6 small-business issues too important to ignore

2010-11-05T21:09:00.008-04:00

Small businesses face a tough market, but there are a few bright spot

It's rough out there for contractors. Everyone is holding on to pennies when they would have willingly spent dollars a few years ago.

For federal contractors, agencies are also adjusting to the tough times, double-checking costs against necessity before spending the slightest bit of money. And small businesses might be getting the worst of it. On top of the recession, government officials are cutting out contractors whenever possible.

And more problems exist for small businesses that already must scale a mountain of issues when trying to win government contracts. But don’t get depressed. There are at least a few bright spots. Some changes might make life at least more bearable for small businesses.

The Efficiency Squeeze

Agency officials face tighter budgets. Their goal is to spend less money while squeezing as much out of contractors as they previously received. Some agencies are considering chopping programs that don’t advance core priorities.

Defense Secretary Robert Gates recently announced a plan to make the Defense Department more efficient. Although insourcing hasn’t produced the savings that the Obama administration imagined, Gates said he’s taking another approach. He plans to hit contractors in the pocketbook.

“The problem with contractors is — and what we’ve learned over the past year — you really don’t get at contractors by cutting people,” Gates said in August. “So the only way, we’ve decided, that you get at the contractor base is to cut the dollars.”

Gates’ overall goal is to cut DOD’s spending by $100 billion in the next five years, while cutting contractor support by 10 percent per year for the next three years.

Some programs will dodge the bullet; others won’t. Programs that avoid elimination will support critical needs, although DOD officials have not identified those programs, according to Deltek, a research and consulting company.

In the same way, some contractors will emerge unscathed, Deltek said in a white paper released in September. Larger firms invest heavily in advocacy in an attempt to influence decisions such as budget and program cuts, the white paper states.

“To the extent those efforts are successful in deflecting funding cuts, smaller firms will be left to absorb the impact,” Deltek writes.

Insourcing Threats

Administration officials also are taking a stand against the private sector’s influence in agencies.

Officials say contractors are getting too close to agencies’ inherently governmental work and influencing decisions toward their advantage. The result is a push for insourcing. Procurement officials have proposed guidelines on inherently governmental work and closely associated tasks. They also created a new category of work, called critical functions, which applies to jobs that aren't inherently governmental but are sensitive enough that agency officials want federal employees to do the work. In short, agencies don't want to rely on the private sector.

Small businesses fear that initiative because they feel they are in the cross hairs. In September, the Interagency Task Force on Federal Contracting Opportunities for Small Businesses, a group of senior government officials, heard small businesses’ outcry against the insourcing initiative.

The “rebalancing efforts will not only limit new opportunities for small businesses but also take existing contracts away from them,” the task force wrote in its report to the president.

Some companies already have had their contracts brought in-house. Robert Burton, former deputy administrator of the Office of Federal Procurement Policy, said the government has insourced some work that isn't inherently governmental or considered to be a critical function.

Burton and other industry groups say the government is secretive about its process for deciding which jobs to insource, and without transparency, no one can be sure about the validity of decisions.

In addition, some federal agencies, such as DOD, must be aggressively pushed before they hand over their calculations and comparisons on pricing, experts say. Small businesses have done that, but it took time and a lot of persistence.

Poached Employees

Related to insourcing, businesses have complained that government agencies are also taking their employees when they move jobs in-house. One official said in September that DOD, for instance, went to the open marketplace to find employees.

Ashton Carter, undersecretary of Defense for acquisition, technology and logistics, denied that characterization. However, he said DOD is seeking employees in places where they can be found. He added that people are interested in joining DOD because it offers the opportunity to play a role in protecting the United States, which is a unique job with a unique mission.

But let’s not get bogged down in the difficulties. There are a few positive trends.

Unwrapped Bundles

Agencies can combine several smaller procurements into one large contract, a process called bundling. The technique puts less pressure on an agency’s employees because there are fewer contracts to manage. However, those bundled contracts are often out of small businesses’ reach.

The interagency task force said officials should tighten regulations to prevent unjustified bundling. And when there’s no way around a bundled contract, agencies need to find other ways to incorporate small businesses into the mix.

In addition, the Small Business Jobs and Credit Act, which became law in September, lowers the governmentwide bundling limit for contracts to $2 million, down from the $10 million limit. It also creates a five-year small-business teaming pilot program to assist small businesses in forming teams and joint ventures to help them compete for larger or bundled contracts.

HUBZone Equality

With President Barack Obama's signature, that new law simply changed a “shall” to a “may” regarding small-business set-asides. In effect, it ended the battle over one small-business program having an advantage over other small-business programs for set-aside contracts.

The new law puts all the Small Business Administration’s small-business programs on equal footing. SBA programs let agencies set aside contracts and compete them among certain types of small businesses, such as those owned by service-disabled veterans or minorities.

Until Sept. 27, companies in economically depressed regions, or Historically Underutilized Business Zones, had priority over other types of businesses because the law that created HUBZones said the government shall use businesses in HUBZones, while other small-business laws used the word "may." The Government Accountability Office and several federal judges ruled numerous times that HUBZones should get the priority because "shall" meant agencies had to use them, while "may" in the other laws meant the use of those small businesses was optional. Now the new law replaces the "shall" with "may." A contracting officer who wants to set aside a contract may choose which category of small companies to use.

Subcontracting Scrutiny

That same law also puts pressure on prime contractors to pay attention to their subcontracting plans or risk a bad mark on their public record.

The statute requires prime contractors to provide a written explanation when they fail to use subcontractors as they describe in their subcontracting plans. The reason had better be good, too. If the explanation doesn’t satisfy a contracting officer, a low grade could hurt the prime contractor’s performance evaluation, which agencies use when awarding new work.

A contractor with a history of failing to meet its subcontracting plan would be identified as such in the Federal Awardee Performance Integrity Information System.

So although business is bad, there are bright spots — at least a few.

Read the story: Washington Technology 6 small-business issues too important to ignore

The Highly Visible Invisible OFPP Administrator

2009-08-11T06:00:00.000-04:00

Obama is reforming contracting with no administrator, and he doesn't seem to mind

Just four weeks after being sworn in as president, Barack Obama signed into law the massive stimulus legislation, complete with $787 billion to spend and significant changes to the government’s contracting regulations.

Two weeks later, Obama declared contracting reform to be a top priority for his administration and issued a memo on some of the changes he had in mind. Since then, he has frequently stated what he sees as a dire need for reforms and oversight of contractors.

Obama signed another bill in May that changed the rules for the Defense Department's procurement of major weapons systems.

Through all of this, he seems to be missing a key player: the administrator of the Office of Federal Procurement Policy.

Obama has chosen a national chief information officer — Vivek Kundra — and picked Aneesh Chopra to be chief technology officer. They quickly became prominent figures, and Kundra has pushed technology as an important part of acquisition reform.

But the president has no procurement policy chief.

The Office of Management and Budget has issued guidance on how agencies are supposed to spend the stimulus money, approved numerous new regulations and nearly completed a definition of inherently governmental functions.

But no chief.

In theory, the OFPP administrator is a key player in anything to do with government acquisition and is downright essential during times of major reform. Nevertheless, the changes are apparently moving along without an administrator. Some experts have started to wonder if the role is as important as others had assumed.

However, the push to find a nominee is building now that OMB’s deputy director for management, Jeff Zients, has been confirmed, said Kundra, who is involved in the search for an OFPP leader.

Even so, the administrator’s desk remains empty, while outside, the acquisition and contracting world is spinning faster than ever.

“There’s something to be said for somebody who knows how to grab on to things that are already in motion,” said Allan Burman, president of Jefferson Solutions, a division of Jefferson Consulting Group.

As the world turns

The government is witnessing some of the biggest changes in contracting in more than a decade. Obama took an about-face from President George W. Bush in a memo issued March 4 that comments on the troubled area of contracting and indicates how important he considers reforming the system.

Experts say the OFPP leader will be in a powerful position. He or she will have the president’s ear and a big agenda to tackle — bigger than in many past administrations.

“This is going to be a highly visible job with senior-level interest in what’s going on,” said Burman, who was acting administrator of OFPP starting in 1988 and confirmed in that role in 1990.

Obama wants tighter oversight of noncompetitive contracts and those without fixed prices. He wants an acquisition workforce that is capable of overseeing contractors. He has also told agencies to use outsourcing only when it’s absolutely necessary so the government can wean itself off its dependence on the private sector.

The American Recovery and Reinvestment Act, which Obama signed into law in February, is disbursing billions of dollars to save the economy, and the law dictates how agencies can spend that money and what contractors must report on when they get the cash. Experts say those rules have set a new standard for acquisition transparency and reporting and thus will spread to all government contracting in the near future. They say a leader needs to guide those changes appropriately.

A few blocks from the empty OFPP administrator’s office, Congress is passing reform legislation. Members are changing small-business set-aside rules and thinking about ways to revamp DOD’s acquisition system so the department can buy information technology faster. Many acquisition experts believe Congress makes rules without really understanding the issues. And that’s another reason it’s important to have an OFPP administrator.

All this activity is happening while the government remains on a fast track to spend $600 billion a year.

Then there’s the acquisition workforce. It’s overworked and demoralized. Employees are waiting for a strong leader to offer them some relief. For several years, they have felt battered by intense scrutiny by Congress, inspectors general and the Government Accountability Office. They want a leader high in the Obama administration’s ranks to protect them.

Catching up

When finally confirmed by the Senate, the administrator will need to sprint to catch up with what’s been happening in the acquisition field, said Angela Styles, OFPP administrator from 2001 to 2003 and now a partner at Crowell and Moring’s Government Contracts Group.

The White House has been working for months to draw up memos and craft a strategy. Most important for OFPP, Obama has brought the traditionally back-office duties of negotiating and signing contracts to the forefront of his agenda.

“We’ll have to break bad habits that have built up over many years,” he said. “But we can’t keep spending good money after bad.”

The first test of the new OFPP administrator’s authority will be how far he or she can stray from the goals Obama outlined in his March 4 memo, according to one expert.

Steve Kelman, administrator of the Office of Federal Procurement Policy from 1993 to 1997 and now a Harvard University professor and Federal Computer Week columnist, said the memo reads more like something written by lawmakers than a document crafted by experts in contracting.

He said the OFPP administrator must wrestle with nitty-gritty acquisition issues, such as how to navigate performance-based contracting and improve the use of contractors’ past-performance information in making awards. The administrator also has to continue melding contracting officers, their technical representatives and program managers into a team as they manage millions of contracts.

Kundra, who is pushing for a speedier, simpler acquisition process, said the OFPP administrator must understand the challenges of government procurement while also believing that the government needs to find faster ways to buy ever-evolving IT.

The administrator should “recognize we can’t treat technology procurements in the same way we do buying buildings,” Kundra said.

Furthermore, a report from industry and government experts urges the administrator to compel agencies to approach acquisitions holistically when they write contract requirements. The administrator will need to improve communication between agencies and industry, the said, and he or she will need to convince employees that technological innovations can improve the acquisition process.

Unfortunately, the delay in naming an OFPP administrator means “people are always going to know you weren’t the one who wrote the agenda,” Styles said. Therefore, the administrator will need to find a way to embrace and personalize the administration's priorities.

Styles said she received her priority — competitive sourcing — from Bush administration officials, but she was involved in drafting the procurement policy from the start because she was nominated in March 2001 and confirmed three months later. Her role was to implement the ideas of her bosses. The same will be true for the next administrator, she added.

When a key position remains vacant while other officials lack deep knowledge of an issue, it can result in a misguided — if not directionless — agenda, said Bob Woods, commissioner of the General Services Administration’s Federal Technology Service from 1994 to 1997 and now president of Topside Consulting. That’s the sort of situation the new OFPP administrator will face.

"You don't want to be the last wolf to the feast," he said. "There’s been a lot of chewing going on since you've not been there."

Missing person

The longer the position remains unfilled, the more some experts question its importance. Congress and the administration seem to be setting policies just fine without an OFPP administrator, they say.

“Here we are in August, and we don’t have a nominee yet,” said Robert Burton, former OFPP deputy administrator and now a partner at Venable law firm. “It’s obviously not a priority yet.”

Burton pointed out that Lesley Field is doing a fine job as acting OFPP administrator, and he questioned the urgency of choosing a permanent administrator. “It’s not like the initiatives don’t go forward,” Burton said. “It’s not like the career people don’t talk with other offices.”

OFPP would work just as well with a career employee in charge, who would likely stay longer than the typical two-year tenure of most OFPP administrators, Burton said [tk: ok?]. Plus, he or she would have the added benefit of understanding the issues involved after having risen through the office’s ranks.

“Acquisition is nothing but a lot of rules and regulations,” and it demands a strong legal background, not a political connection, Burton said. Deputy administrators work on many aspects of reforms, and they’re often dealing with agency leaders on regulations. Burton also ran OFPP during many of his years there as administrators came and went.

Kelman said there are benefits to appointing a retired career acquisition official to be OFPP administrator because that person wouldn't need a crash-course in what’s happening and why.

In the meantime, highly visible officials are talking about innovative acquisition reforms. For example, Kundra is calling for saving money through an IT storefront, cloud computing and software-as-a-service initiatives. He wants to use technology to speed the slow and deliberate acquisition process. And the tech-savvy Obama administration is putting a lot of weight behind Kundra.

“The administration is making that post very visible,” Burton said. Kundra’s prominence might suggest the decline of the OFPP administrator’s role as a leader in acquisition reform, Burton added.

However, Deidre Lee, OFPP administrator from 1998 to 2000 and now executive vice president of federal affairs and operations at the Professional Services Council, said Kundra could be a strong ally of the OFPP administrator.

“Two or three people at that high of a position with like minds can do a lot,” she said.

Although neither of them has much statutory authority or budget control, “one of the most important things anyone can have is a bully pulpit,” Kelman said. The two leaders could inspire people and soothe an anxious acquisition workforce, he added.

Only a few people are capable of doing that. Lee said that when acquisition employees make a mistake, the administration’s “leadership has got to step up there and say, 'Yep, we tried it, made a mistake, noted [it] and moved on. Let’s try again.'”

Everything is in place to move the workforce forward with the innovations that technology allows, experts say, but people are waiting for leaders to show them the way.

“I think the lion’s share is ready, but it’s going to take a lot of courage,” said John Nyce, associate director of the Acquisition Services Directorate at the Interior Department’s National Business Center. He added that they’re looking for someone to stand up for them.

Lee said the workforce is in huddle mode. Employees have learned that they can avoid attention by not moving forward. “That’s why leadership is so critical,” she said.

And employees understand that a political appointee has more access to key decision-makers. “The better the relationships, the better job you do,” Styles said, mentioning Kelman and David Safavian, who was OFPP administrator from 2004 to 2005 until he resigned during a scandal.

Some experts believe the administrator should remain a political appointee, even if a career person is just as capable. That approach ensures respect from other appointees throughout the government and shows that the administrator shares the president’s goals and agenda.

Furthermore, the president’s support for the administrator will make employees listen to what he or she has to say and pay attention to the direction they’re headed.

“A lot of the workforce longs for good leadership,” Kelman said. “And it’s up to that person to show he’s willing to go out of his way to work for them.”

Read the story: FCW.com News - Acquisition reforms rush forward while top OFPP seat remains empty

Kundra aids search for procurement leader

2009-08-10T07:10:00.001-04:00

Top IT official believes procurement policy must be flexible

Six months have passed since President Barack Obama took office, and the chair reserved for the leader of the Office of Federal Procurement Policy remains empty. Now Vivek Kundra, the federal chief information officer, is helping the administration look for a suitable nominee.

Kundra is drawing on his information technology expertise and mandate to seek an OFPP administrator who will “recognize we can’t treat technology procurements in the same way we do buying buildings,” he said.

Jeffrey Zients, deputy director for management at the Office of Management and Budget, is the point man for the quest. Finding the next OFPP administrator has been a top priority for Zients since his Senate confirmation on June 19. No one has been nominated for the OFPP post, and there are few rumors about whom the candidates might be.

However, experts expressed surprise that CIO Kundra is so actively involved in the search.

Bob Woods, president of Topside Consulting and former commissioner of the General Services Administration’s Federal Technology Service, said agencies conduct a broad array of procurements. Buying battleships and buying large quantities of paper are different kinds of procurements, and Kundra's involvement might signal an over-emphasis on IT, Woods said.

Nevertheless, Kundra has campaigned vigorously for simplifying the buying process. “Everyone in government shouldn’t have to have a Ph.D. in procurement,” he said. “Why is it so complex?”

During a discussion July 27 with reporters and editors from the 1105 Government Information Group, parent company of Federal Computer Week, Kundra said the government needs to do a better job of using technology to make the whole process easier.

Kundra has proposed creating a virtual storefront where agencies could quickly buy services, such as cloud computing. Although he said GSA’s Multiple Award Schedules program and GSA Advantage Web site have many benefits, he said there are even faster ways to work. Each time an agency wants to buy IT, it shouldn’t have to start a two-year procurement process, he said, adding that by the time the contract is awarded, the technology is outdated.

However, many experts say the process isn’t always that time-consuming.

Kundra said his intent is to make buying IT easier and more intuitive via his proposed virtual storefront, which would mirror systems in the commercial marketplace, such as Amazon.com and eBay.

That approach may not fly, say critics. “At some point, he’s going to have to come to terms with the fact that the government is built to be inefficient,” said one government official, who spoke on condition of anonymity. Companies such as Amazon and eBay don’t contract with the government because they don’t want to have to abide by the government's rules, the official added.

Read the story: FCW.com News - Kundra aids search for procurement leader

Senate passes bill with HUBZone change

2009-07-24T15:48:00.005-04:00

Bill deals with small-business equality issue

The Senate has passed its fiscal 2010 National Defense Authorization Act (S. 1390) with a provision that would remove the “shall” in the law that some government attorneys say gives small businesses in historically underutilized business zones (HUBZones) first preference when a contracting officer considers setting aside a contract for small businesses.

The mandatory “shall” would become a “may,” which would give the officers more discretion in awarding the contracts.

Since May, the Government Accountability Office, the Small Business Administration and the Office of Management and Budget have been debating whether HUBZone businesses should get priority over service-disabled veteran-owned small businesses and firms in SBA's 8(a) program. Read the story. The Senate passed the legislation July 23.

Rep. Roscoe Bartlett (R-Md.), co-chairman of the HUBZone Caucus, today said he supports the statutory change.

“Small-business owners from these three categories endure different types of disadvantages, but they all create invaluable opportunities and magnified benefits in our communities. They deserve equal priority consideration for federal government small-business contracts,” he said.

The Senate passed the legislation July 23.

Also regarding acquisition reforms, the bill would require a Defense Department contracting officer to justify why a contract worth more than $20 million should be awarded on a sole-source basis. For example, the officer would have to show that the anticipated costs are fair and reasonable. The bill would also tighten restrictions on public/private competitions for government work. The competitions pit the two sectors against each other to see who can do the work best for the lowest price.

The House passed its version of the bill in June. A conference committee of senators and House members will work out the differences before sending the legislation to the president.

Read the story: FCW.com News - Senate passes bill with HUBZone change

Senate deal will level small-business contract preferences

2009-07-24T14:58:00.004-04:00

HUBZone companies would not get priority over 8(a) companies and service-disabled veteran business owners

Senate leaders have agreed to include a provision in the next defense authorization bill to do away with the current debate over which categories of small businesses should be given priority in federal contracting.

The amendment, introduced by Sen. Mary Landrieu (D-La.), would remove the special preference given to small businesses in historically underutilized business zones (HUBZones), putting those firms on a par with companies owned by service-disabled veterans and those in the Small Business Administration’s 8(a) program.

“All small businesses should be given an equal opportunity to succeed,” said Landrieu, chairwoman of the Small Business and Entrepreneurship Committee.

The Senate is currently considering the fiscal 2010 National Defense Authorization Act ( S. 1390 ). The House passed its version in June.

Landrieu said her amendment is in response to a May ruling by the Government Accountability Office that HUBZone companies had to be considered before other categories of business when conducting a set-aside procurement. She said the ruling has caused contractors to pull back business from 8(a) and service-disabled veterans programs.

In its decision, GAO said the Army made a mistake when it didn’t consider whether at least two HUBZone businesses would bid on an information technology contract. Mission Critical Solutions, a HUBZone company, protested the award after the Army awarded a one-year, $3.45 million sole-source contract to Copper River Information Technology, a company owned by Alaska Natives.

SBA and administration officials also object to GAO’s decision. They say it conflicts with SBA's long-standing regulations and its view that 8(a) companies and those owned by service-disabled veterans and HUBZone companies are all equals. On July 10, OMB told agencies to disregard GAO’s decision.

“If agencies were to follow the GAO decisions, the federal government’s efforts to procure goods and services from 8(a) small businesses and from [service-disabled, veteran-owned small businesses] through the other statutory programs may be negatively impacted,” Office of Management and Budget Director Peter Orszag wrote on July 10.

Read the story: WashingtonTechnology.com News - Senate deal will level small-business contract preferences

Congress, administration move into protected territory

2009-07-24T14:55:00.003-04:00

The governmnent is having an ongoing debate about certain small businesses with big advantages

Congress and the Obama administration have stepped into a well-guarded territory of small-business contracting: special advantages.

The Senate Homeland Security and Governmental Affairs Committee’s ad hoc Contracting Oversight Subcommittee has questioned whether the explosive growth in Alaska Native Corporations’ (ANCs) contracting dollars in the last eight years through unique set-aside rules has given ANCs too much of an advantage. The subcommittee held a hearing July 16 that has become part of an ongoing debate about some categories of small businesses that live by special rules.

“The current situation is out of balance, and it may be time to swing the pendulum back the other way,” said Mark Lumber, senior vice president for federal program for Cirrus Technology, a historically underutilized business zone (HUBZone) small business in Huntsville, Ala.

Sen. Claire McCaskill (D-Mo.), the subcommittee chairwoman, asked several representatives for ANCs if they would agree with changes to make ANCs abide by the same rules as Indian tribes and other socially and economically disadvantaged companies.

If there is no difference between them, she said, “Then I hope that you would accept a change in the law that would make sure that you are on completely equal footing."

The ANC representatives at the hearing remained neutral. “We are not in a position today, through our organizations, to negotiate on behalf of our people. We need to go through an extensive tribal consultant process,” said Susan Lukin, executive director of Native American Contractors Association.

Officials believe ANCs are getting a disproportionate amount of money compared to other small businesses, according to reports. Because of ANCs’ rules, the amount of contracting dollars going to ANCs have grown by 1,386 percent since fiscal 2000 and have tripled from $1.1 billion in 2004 to $3.9 billion in 2008, according to the Small Business Administration’s inspector general. In SBA’s 8(a) small business program in 2008, ANCs were awarded 26 percent of the total dollars flowing into the program, although they are only 2 percent of the total number of companies in the program, according the IG’s July 10 report.

Similarly, McCaskill’s subcommittee analyzed information from 19 ANCs and found similar results. ANCs received $6.6 billion in 8(a) multi-million-dollar sole-source contracts between 2000 and 2008, according to its report.

The increases are a result of agencies’ small-business contracting goals and, more importantly, a quick way to award a contract, officials say. Rules that are unique to only ANCs allow agencies to award them sole-source contracts of any size without competition, and no fear of bid protests.

Sen. Susan Collins (R-Maine), the subcommittee’s ranking member, said Congress needs to carefully consider whether the 8(a) program rules offer too many benefits to ANCs at the expense of the others.

In the private sector, many business owners are upset by the set-aside partiality ANCs receive. Lumber said few people would object to ANCs having some type of procurement preference, but not that allows for this much advantage.

At the same time, HUBZone businesses get a deal that upsets many other business owners and the Obama administration. It’s a difference of a word: "Shall" versus "may."

Office of Management and Budget Director Peter Orszag on July 10 told agencies to disregard the Government Accountability Office’s (GAO) May 4 bid protest ruling that said HUBZone small businesses get first crack at a contract set-aside. GAO rejected SBA's request to reconsider its rulings.

Because of language in a 1997 authorization law, GAO sustained two bid protests in favor of HUBZone businesses. As a result, GAO ruled that those companies get priority over all 8(a) small businesses and companies owned by service-disabled veterans.

“You’ve got to live by the ‘shall,’ ” said Robert Burton, former deputy administrator of the Office of Federal Procurement Policy and now a partner at the Venable law firm.

While GAO believes the “shall” in the law is a mandate, SBA officials said the 8(a) companies, service-disabled veterans, and HUBZone companies should all be equal to each other.

John Moliere, an advocate service-disabled veteran contractors and president of Standard Communications, said, "I envision the lawyers at GAO smugly pleased with their decision."

Meanwhile, the HUBZone Contractors National Council isn't talking about the disagreement between GAO and OMB.

If Congress or the administration tries to make any changes to these sensitive areas, Burton said it won’t be an easy legislative fix. There are members of Congress who will fight to keep things as they are. Both of Alaska’s senators, who weren't members of McCaskill's subcommittee, took advantage of the special privilege to question witnesses at the ANC hearing. They both also thrust their strong support behind the Alaska Natives.

Over all, Moliere said, “This is not the end of this skirmish. It will erupt in a full-fledged battle.”

Read the story: FCW.com News - Congress, administration move into protected territory

GAO rejects request to review HUBZone decisions

2009-07-14T21:38:00.007-04:00

SBA and OMB contend GAO overreached its authority in ruling that HUBZone businesses have priority

The Government Accountability Office today denied Small Business Administration officials’ request to reconsider recent bid protest decisions that give some small businesses priority over others.

SBA’s request “is denied where newly raised information fails to show that our prior decision contains any errors of fact or law,” GAO’s Acting General Counsel Daniel Gordon wrote in a decision released today.

SBA and the Office of Management and Budget Director Peter Orszag contended GAO overreached its authority when it ruled that firms in historically underutilized business zones (HUBZones) should get priority over small businesses in the SBA’s 8(a) program or service-disabled, veteran-owned small businesses.

GAO’s rulings are not binding on federal agencies and are contrary to SBA regulations, Orszag wrote in a memo released to agencies July 10.

“If agencies were to follow the GAO decisions, the federal government’s efforts to procure goods and services from 8(a) small businesses and from [service-disabled, veteran-owned small businesses] through the other statutory programs may be negatively impacted,” Orszag wrote.

He also wrote that the rulings remove contracting officers' discretion to set aside a contract. Until administration attorneys finish their legal review, Orszag wrote that contracting officers should continue using SBA's view of the three types of small businesses. Federal agencies should not “prioritize HUBZone small businesses over” 8(a) or veteran-owned companies, he wrote.

The administration’s concerns come from a May 4 ruling on a protest by Mission Critical Solutions, a HUBZone company. GAO ruled that the Army made a mistake and didn’t consider whether at least two HUBZone businesses would bid on an information technology contract. Instead, the Army awarded the one-year, $3.45 million sole-source contract to Copper River Information Technology, a company owned by Alaska Natives. Law allows Alaska Native corporations to receive sole-source contracts of any size.

GAO based its decision on the Small Business Reauthorization Act of 1997. The legislation states that “a contract opportunity shall be awarded” on the basis of a set-aside competition among HUBZone companies. Meanwhile, Congress didn’t afford companies in SBA’s 8(a) program or companies owned by service-disabled veterans the same mandate. The law only says contracting officers may set aside a contract to those types of companies.

“We do not think SBA’s regulatory implementation of HUBZone and 8(a) statutes is reasonable since it fails to give effect to mandatory language of the HUBZone statute,” the decision in the Mission Critical Solutions case states.

GAO reached a similar conclusion in September 2008, when it considered a bid protest from International Program Group, another HUBZone company. The Marine Corps set aside a contract for service-disabled veterans before considering whether a HUBZone set-aside would be appropriate. GAO ruled against the Marines.

Read the story: Washingtontechnology.com News - GAO rejects request to review HUBZone decisions

DOD’s use of services contracts gets congressional scrutiny

2009-06-29T21:43:00.004-04:00

The House version of the 2010 National Defense Authorization Act would require the Defense Department to hire an outside organization to assess its use and oversight of services contracts.

The House Armed Services Committee believes DOD doesn't have a strategic approach to managing its service contracts, according to the committee’s June 18 report on the authorization bill (H.R. 2637).

As a result, “the department is at risk of being unable to identify and correct poor contractor performance in a timely manner and is at risk of paying contractors more than the value of the services they performed,” the committee wrote.

The House passed the bill June 25 by a vote of 389-22. The Senate committee has marked up its version of the bill, but the committee has yet to approve it.

Under the House bill, the assessment would be conducted by a federally funded research and development center. The center would look at the guidance DOD provides its acquisition workforce on how to develop a services contract, including how to define requirements and the associated performance metrics.

The center also would look at whether or not DOD has enough people in its acquisition workforce to do the work appropriately. The report would be due in March 2010.

Rep. Ike Skelton (D-Mo.), chairman of the House Armed Services Committee, said the legislation supports the Defense Secretary Robert Gates' plan to increase the civilian acquisition workforce’s size and to reduce DOD’s reliance on contractors for critical acquisition duties. DOD officials want to hire 9,000 new government employees and convert 11,000 contractor jobs to DOD civilian personnel.

“Defense acquisition reform is a top priority for our committee,” Skelton said in statement June 17 after his committee approved the legislation.

In another acquisition reform, the committee wants to find ways for DOD to buy IT more quickly.

IT systems require regular updates, because of changes in technology, which affects critical parts of the DOD infrastructure. But DOD’s process for buying IT makes it difficult for the department to keep up, according to a DOD task force.

The acquisition process is time-consuming and cumbersome, the task force wrote in a March report. "The process should be agile and geared to delivering meaningful increments of capability in approximately 18 months or less."

The House bill would allow DOD to pick 10 IT programs every year in which to test new procurement processes.Acquisition reforms in the House's fiscal 2010 National Defense Authorization Act concentrate on oversight of service contracts and buying information technology quickly.

Read the story: FCW.com News - DOD’s use of services contracts gets congressional scrutiny

GSA contract expiration reflects market needs, experts say

2009-06-25T18:31:00.006-04:00

GSA official says many GWACs won't be renewed as GSA markets its Alliant and Alliant Small Business contracts

The General Services Administration's plan to let many of its governmentwide information technology contracts expire, largely ending the era of big governmentwide acquisition contracts (GWACs), reflects the evolving needs of the market, experts say.

They say the federal IT market’s sales have been driving GSA to end and merge GWACs for several years now. There are too many GWACs, causing too much overlap of services. The result is scattered sales while the cost of running the contracts still dips deeply into GSA’s pockets.

GSA will continue to support only Alliant, its small-business companion contract and a few GWACs targeted to companies in specific socioeconomic categories, said Ed O’Hare, assistant commissioner of the Office of Integrated Technology Services at GSA’s Federal Acquisition Service.

For the long term, though, GSA will likely merge the GWAC program with the widely used Multiple Award Schedules program. “But that will take years, not months,” O’Hare said.

Before ending the GWAC program, GSA will first winnow down the number of marginally performing GWACs, such as Commerce Information Technology Solutions-NexGen, said Larry Allen, president of the Coalition for Government Procurement. In recent years, GSA has taken over several GWACs, such as COMMITS from the Commerce Department, and now the agency needs to streamline its efforts, he added.

GSA has said for more than a year that the overlapping GWACs are expensive for government and industry and should be pared down, said Bill Perlowitz, vice president of advanced technology at Apptis. No one should be surprised that the agency is saying it won’t renew many GWACs, particularly given the Obama administration’s desire for a more efficient government.

“GSA would be streamlining things” to close down or merge GWACs into its schedules program, said Hope Lane, officer of government contracts consulting at Aronson and Co.

Total IT sales figures have slipped slightly in the past several years. The fallout in 2004 over GSA’s mishandling of the Defense Department’s money has caused some DOD customers to turn to other IT contracts, such as the Navy Department’s SeaPort-e, Lane said.

Meanwhile, sales on GSA’s massive Schedule 70 have remained relatively flat at about $17 billion annually for the past three years, according to government figures.

The recently awarded Alliant and Alliant Small Business GWACs, which were delayed for two years, have a wide choice of services, which makes many other GWACs unnecessary, experts say.

"You can get pretty much anything you want from Alliant," Lane said.

Courtney Fairchild, president of Global Services, said GSA’s Alliant contracts, which were awarded earlier this year, were always meant to replace the expiring GWACs.

“I suppose the real question for industry is whether or not government agencies have enough faith in the Alliant contract to switch over,” she said.

Agencies that shy away from Alliant will still have the option to work with one of more than 15,000 companies in the schedules program.

GWACs offer options to agencies that the schedules program can’t, such as cost-reimbursement contracts. Unless GSA can tweak the schedules program’s rules to change that, GWACs will always have a place, Allen said.

In addition, GSA would have a tough time closing the socioeconomic-based GWACs, such as the 8(a) small-business Streamlined Technology Acquisition Resources for Services and the Veterans Technology Services GWACs.

“Would you want to stand before Congress and try to explain why you ended those contracts?” Allen asked.

On the other hand, any attempt to merge the GWAC and schedules programs would be “consistent with the spirit and message of the creation of the recent Federal Acquisition Service,” Fairchild said.

The reorganization of the Federal Technology Service and the Federal Supply Service into FAS allowed GSA to scrap dueling and repetitive contracts that might confuse customers.

Read the story: Washingtontechnology.com News - GSA contract expiration reflects market needs, experts say

Acquisition workforce: Social media could be big draw

2009-06-23T05:59:00.002-04:00

The government acquisition community ought to take a cue from President Barack Obama’s campaign strategy and use social media technology to bolster its ranks, one lawmaker says.

The government needs to be brave enough to draw on the younger generation’s new ways of interacting to help attract them to government service and to simply improve how agencies run, said Rep. Brian Bilbray (R-Calif.), speaking at a congressional hearing last week.

Many older federal employees may not be as comfortable with that technology, but the up-and-coming employees live by it. “This is their primary way of thinking,” he said.

Obama’s campaign captured young people’s attention like no other presidential candidate has before. It created Change.gov, a hip Web site describing Obama’s agenda. But Obama also sent out text messages and had a presence on Facebook, MySpace and numerous other social networking sites. Obama posted videos on YouTube. He even tweeted.

As a candidate, Obama was “a socially enabled, socially connected, socially aware, socially conscious leader,” Barry Libert, author of “Barack, Inc.: Winning Business Lessons of the Obama Campaign,” said in a recent speech.

At the hearing, Bilbray said the older generations that didn’t grow up with this technology will always be somewhat blind to it, unlike the younger people who have never known life without that technology.

“First of all, it intimidates us to some degree, and we may not understand it. But the potential is huge,” he said.

The next generation is heading toward more Web 2.0 tools and collaboration from the crowd.

The General Services Administration already has a technology-rich culture, said David Drabkin, acting chief acquisition officer at GSA, who testified at the hearing. The agency is adopting cloud computing and Web 2.0 collaboration tools internally and using social networking sites such as Facebook to interact with the public.

“We are on the edge,” he said.

Mary Davie, assistant Federal Acquisition Service commissioner for assisted acquisition services at GSA, is already thinking about the application of social media to acquisition. In a column in this week’s print edition of Federal Computer Week, Davie suggests opening the process of defining an acquisition’s requirements to get insight from a community of experts, inside or outside of the government.

“Using the wisdom of the crowd to define requirements and the best development process, participants could propose ideas based on experience, good practices, and standards, question and weed out bad ideas, build on one another’s ideas, and float the best to the top,” she writes.

Like Bilbray, Davie sees an opportunity not only to improve procurement but to appeal to younger recruits.

“Imagine what this might do to attract and retain the Net Generation workforce we are always seeking out,” Davie wrote.

At the hearing, Shay Assad, acting deputy undersecretary of defense for acquisition and technology, said technology will bring major changes in acquisition during the next two years.

The department is developing a database that will give Defense Department contracting officials quick access to information on business deals across the department, such as how the department negotiates with certain contractors, what they buy, and how much they may.

The system will be based on information collected by the Defense Contract Management Agency, which is the hub for analysis of the value and costs of DOD’s procurements.

At present, the individual services often don’t share information and know little about what the other services are buying, even from the same contractor, Assad said. “The fact of the matter is that we are not as capable as a number of organizations in terms of being able to share that information, but we are getting there,” he said.

Read the rest of the story: FCW.com News - Acquisition workforce: Social media could be big draw

GSA looks to corral former customers

2009-06-22T20:53:00.004-04:00

Procurement agency tries to win back lost business

Good news hasn't come very often to the embattled General Services Administration in recent years. So when some positive attention does come its way, GSA officials are eager to wave the results in front of its old go-it-alone customers — if only to show them that the agency has left its bad habits in the past.

Auditors from the Defense Department and GSA have been examining GSA’s books, and agency officials are confident the outcome will reveal that GSA can toe the regulatory line, said Ed O’Hare, new assistant commissioner for integrated technology services at GSA’s Federal Acquisition Service.

“We are confident we made the changes we needed to make, and we’ll fly through,” he said in a speech delivered in May.

Meanwhile, his marketing people are gathering a list of multiagency contracts and indefinite-delivery, indefinite-quantity contracts that other agencies launched around the same time GSA was found to be assisting the Defense Department with illegal purchases. O’Hare is targeting his message of repentance to the officers in the agencies whose own IDIQs are about to expire. The contracts often last for five to 10 years.

He wants to convince those agencies that GSA is ready to take over the other IDIQs, relieving other agencies of the maintenance burdens that come with running a large contracting program.

His question is simply: “Do you really want to do this again?”

For added emphasis, O’Hare also intends to highlight GSA’s inexpensive usage fees. Agencies pay a 0.75 percent service fee to use the Alliant GWAC, and GSA is capping that fee at $150,000 a year.

“I defy anyone to do a GWAC less expensively than that,” O’Hare said.

GSA’s ‘come to Jesus’ moment

Although GSA says it has moved past the scandal that rocked it five years ago, the memories — and history — linger. On Jan. 8, 2004, the GSA inspector general reported a pervasive problem of improper task orders and contract awards by the agency’s client support centers (CSCs), which served DOD. The IG found that some GSA employees were using the Information Technology Fund for purchases of goods and services that were well outside the fund’s scope. As a result, DOD officials banned use of GSA for major purchases.

The list of GSA’s sins grew long, according to the IG: improper sole-source awards, allowing work outside the scope of contracts, and inappropriately using time-and-materials task orders. Although the IT fund is authorized only for acquiring IT equipment, software and related services, investigators found that CSCs were dipping into it to pay for a wide variety of inappropriate things, such as marine barriers, pathogen detection devices, and construction of classrooms and office buildings.

The GSA IG attributed the problems to a culture that emphasized revenue growth instead of adhering to proper procurement procedures.

“I think every organization has to have a ‘come to Jesus’ moment,” said David Drabkin, GSA’s chief acquisition officer. That IG report was GSA’s moment.

Although the problems applied only to one small piece of GSA’s operation, the public perception was that the agency was more broadly compromised. “One part of your business does badly, and it hurts everybody,” Drabkin said.

DOD customers were frustrated with GSA and showed it in 2004 and 2005. Sales in the multiple-award schedules program slowed, but the program kept GSA from losing money year over year, Drabkin said.

But O’Hare and Drabkin said the agency has reorganized and revamped its operations. GSA is a new place compared to several years ago. And with the problems solved, GSA is ready to work. This latest round of audits, as required by the fiscal 2007 National Defense Authorization Act, should close the file on GSA as a poor broker of procurement dollars, O’Hare said.

Good news

Kevin Carroll, former program executive officer for the Army’s enterprise information systems who was in charge of the Information Technology Enabled Services-2S contract, said the new audit results can only help GSA rebuild its image and agencies’ trust in it.

“They’re showing responsibility,” said Carroll, president of the Kevin Carroll Group. But, he said, GSA also must continue to re-establish and develop its business relationship with DOD. Just showing good audit results won’t be enough.

Greg Rothwell, former chief procurement officer at the Homeland Security Department and president of Everymay Consulting Group, said there’s a deeper issue that might be too tough for GSA to surmount with a good audit: Agencies have become accustomed to doing their own contracting, and they aren’t likely to dump their contracts just to return to GSA.

Martha Johnson, President Barack Obama's nominee to be GSA administrator, said the agency has suffered its decline largely because of new freedom for agencies. Legislative changes in the 1990s, such as the Clinger-Cohen Act, removed many of the rules that required agencies to use GSA. It’s now one option among many.

“If you own it, you can control it,” said Rothwell, who helped to launch DHS’ Enterprise Acquisition Gateway for Leading Edge Solutions (EAGLE) contract and the Internal Revenue Service’s first two iterations of the Total Information Processing Support Services (TIPSS) contracts. “If you can’t control it, it can’t be as responsive to the agency’s mission.”

Faster, better, cheaper

The reality of control and GSA’s rough times forced it to cater to its customers and listen to them, experts say. For instance, GSA is letting agencies use contracts other than its own when GSA assists a customer agency.

GSA is scrambling to get started on launching ways for agencies to get on board with the Obama administration’s emphasis on cloud computing. Chief Information Officer Vivek Kundra and Chief Technology Officer Aneesh Chopra are advancing the administration’s policy, while GSA’s role could be to make it easy for agencies to use cloud computing services.

“We see the administration’s requirements, we respond by initiating some kind of contract action and make it fast and easy for government agencies to use,” O’Hare said.

He even wants to make cloud computing services available to agencies using a credit card, especially when they’re in a pinch for time.

“You don’t have to go to the CIO, you don’t have to go plan it, you don’t have to go buy servers or digital maps or do a [certification and accreditation]," he said. O'Hare envisions an agency employee logging on to a Web site, answering a few questions, and “boom, check out, you got it.”

O’Hare’s Office of Integrated Technology Services has awarded all of its major contracts, such as Alliant and Networx, and they’re ready for business. "I’ve got to get out there and talk to people and try to convince them we’ve already got it,” he said.

And he wants to make GSA work “faster, better and cheaper” than other agencies can offer. “My job is to make it work,” he said.

Read the story: FCW.com News - GSA looks to corral former customers

Think twice before insourcing government work

2009-06-10T17:41:00.005-04:00

A report says the Obama administation should be careful before taking jobs from contractors and giving them to agencies

The Obama administration and Congress should proceed cautiously as they attempt to take work away from contractors and hand it to agencies' employees, according to a report released today.

“A rush to insource thousands of positions, while trying to take on ever more government programs, can end in disaster,” wrote Raj Sharma, president of the Federal Acquisition Innovation and Reform Institute, in a report titled "The Move to 'Insourcing'…Proceed with Caution."

Agencies should concentrate first on removing contractors from jobs already defined as inherently governmental and duties central to agencies’ missions, the report states. At the same time, officials need to consider insourcing other jobs in longer-term phases, he wrote, adding that the government can handle the shifting load much easier in stages rather than all at once.

“Rushing to undo what has been in the making for years — perhaps decades — will be counterproductive,” Sharma wrote.

Moreover, taking work from contractors must be done deliberately and based on facts, not innuendo and rhetoric, he wrote.

President Barack Obama often depicts contractors as taking advantage of the government.

However, contractors are a major component of how the government operates, Sharma said, and they often perform work that requires specialized expertise, Sharma added.

“The current rhetoric that demonizes all contractors, instead of those few that are guilty of fraud and abuse, will only deter the best suppliers that we so badly need from competing for government business,” he wrote.

He added that an essential component of success for Obama’s plans for health care reform, energy independence and social innovation will be the technical expertise, innovation and scale that industry can bring.

Meanwhile, experts say experienced federal employees are attractive to private-sector companies, which often offer more to those employees than the government does. Also, a large number of government employees are nearing retirement, and agencies’ acquisition jobs are remaining vacant because few people are seeking those jobs.

Obama’s calls to join public service can only do so much to help find people to do the work, Sharma wrote. The government needs to reconsider its recruiting efforts, pay and professional development policies to make them competitive with the private sector before agencies dramatically insource jobs.

“While it may be feasible to hire thousands of people during the current economic downturn, it will be difficult to retain this talent unless systemic human-capital issues are addressed,” he wrote.

Sharma said officials should answer the following questions before bringing work in-house:

Which positions should be insourced?
How and when should they be insourced?
What will attract the people needed to do the jobs once they are brought in-house?
How will the government retain the employees who are doing the insourced jobs?

Read the story: FCW.com News - Report: Think twice before insourcing government work

Contractors need to closely watch procurement changes

2009-06-07T21:29:00.009-04:00

Obama administration and Congress advocate for new era of contracting

Contractors had better dust off their federal rules books.

With the Obama administration concentrating on increasing transparency and reducing contracting costs through procurement reforms and tougher checks on vendors, contractors have plenty to keep track of.

The tone from the administration is often negative, and in some of his statements, President Barack Obama has described contractors as abusers, intent on lining their pockets with federal money.

But some experts say companies aren’t as alert as they should be about changing rules environment.

“Contractors have to be much more vigilant,” said Robert Burton, former deputy administrator of the Office of Federal Procurement Policy and now partner at Venable law firm. “But lots of people are slow to get the message.”

In late May, federal officials took steps to more closely regulate contractors. On May 22, Obama signed the Weapons System Acquisition Reform Act (S. 454), which includes tighter regulations on contractor conflicts of interest.

Under existing rules, the Defense Department and its subsidiary agencies must determine on a case-by-case basis how they can reduce conflicts of interest. However, Congress said DOD must strengthen those requirements. For instance, the department needs to make sure contractors give objective and unbiased plans to guard against any possible conflict, according to the congressional conference report on the legislation.

At the bill signing ceremony, the president reiterated his view on contractors and why DOD needs to augment its conflict-of-interest restrictions.

“When it comes to purchasing weapons systems and developing defense projects, the choice we face is between investments that are designed to keep the American people safe and those that are simply designed to make a defense company or a contractor rich,” Obama said.

Target: Conflicts of interest

The conflict-of-interest provision in the new law highlights Congress’ push to close the lid on any contractors’ fingers before they reach into the federal cookie jar. But the Federal Acquisition Regulation has few details about conflicts of interest, and last year, Congress ordered OFPP officials to review the FAR to see if it needs more guidance. The subtle undertone in the order, which is in the fiscal 2009 National Defense Authorization Act, reveals that lawmakers believe in tougher regulations on conflicts of interest, but they aren’t sure how to apply them.

The complications of mandatory reporting rules stretch beyond actions on a single contract. Even if there is no clause mentioning ethics guidelines or reporting of overpayment or potential fraud, allegations of wrongdoing in this area can result in damage to a company's reputation that might be hard to shake. For one, there’s a government database that lists companies that have been accused of failing to act or adhere to contracting rules.

It’s a new era of mandates, Burton said. “That’s what’s changing acquisition now.”

However, some contractors are lax because they don’t think this affects them, especially if their contract has no specific clause, Burton said.

These days, with transparency and scrutiny in tandem, contractors need to be aware even of standard rules.

Exec pay draws attention

Beyond requiring a company to have an ethics program, officials are skeptical of excessive executive pay. In March, Obama said the government shouldn’t line the pockets of contractors. But agencies, particularly DOD, must direct tax dollars to fulfill the nation’s priorities.

On May 21, a day before the president signed the acquisition reform act, OFPP updated the maximum amount the government will reimburse companies’ overhead costs included in fiscal 2009 contracts to compensate an executive. In fiscal 2009, a company can charge the government up to $684,181 per contract in those costs to pay their top employees. That’s $72,000 more than in fiscal 2008.

Although it’s a standard annual update, one government contracting expert said companies need to be more aware of the dollar figure and similar requirements.

“I will say that this figure is taking on added importance with the Obama administration taking a hard look at what government contractor executives make,” said Larry Allen, president of the Coalition for Government Procurement.

“Coupled with the transparency mandate and the [stimulus]-related pay disclosures, I think a lot more companies need to be aware of what the government ‘limit’ is,” he said.

The American Recovery and Reinvestment Act, which Obama signed in February, also requires greater disclosure of how a contractor spends the stimulus money. It also forces contractors to offer access to the government overseers, such as inspectors general, while protecting whistle-blowers.

If a contractor doesn’t follow the rules, it will be exposed under the new regulations, said Ray Bjorklund, senior vice president and chief knowledge officer at FedSources, a market research firm.

“The contractor is taking the brunt” of the new rules, he said. “That’s just the way it is.”

Read the story: WashingtonTechnology.com - Contractors need to closely watch procurement changes

GSA nominee faces Senate panel and charms 'em

2009-06-04T20:49:00.033-04:00

Senators say nominee Martha Johnson has plenty of private-sector and government experience

Martha Johnson, President Barack Obama’s nominee to be administrator of the General Services Administration, seems to be a shoo-in for the job.

Sen. Joe Lieberman (I-Conn.), chairman of the Homeland Security and Governmental Affairs Committee, said at Johnson’s confirmation hearing June 3 that he would work to quickly get her nomination approved by the committee and then the Senate.

He also said Obama made a wise choice in nominating her. “GSA, the president and the government need you to be at your desk,” he told Johnson.

Other senators mentioned Johnson’s qualifications and experience in the nonprofit and private sectors and the federal government, particularly as chief of staff at GSA in the 1990s when David Barram was administrator.

Johnson said she’s thrilled to go back to GSA. “‘Thrilled’ is actually a code word for me and for the agency,” she said.

Johnson said her highest priorities are to:

Demand, model and secure an uncompromising demonstration of ethical behavior and an organizational culture of values and trust.
Guarantee consistent, prompt and high-value performance for GSA’s customers.
Work to meet the demands of the economic stimulus law.
Support the Obama administration’s promise of a more transparent government.
Build and nurture strong leadership.

Lieberman and Sen. Susan Collins (R-Maine), the committee’s ranking member, told Johnson that agencies have turned from GSA to do their own procurements because they’re skeptical of GSA's services.

“Some agencies have lost confidence in the ability of GSA to provide the best products and at the best prices and have begun to negotiate their own contracts that duplicate services offered by GSA,” Lieberman said. “That defeats the purpose of GSA.”

The wave of interagency contracts is a market gesture against GSA’s performance, Johnson said. But another major underlying issue that has driven agencies to do their own procurements is the freedom to not use GSA. Legislative changes made the 1990s, including the Clinger-Cohen Act, lifted rules that made GSA the primary source for buying certain products and services. As a result, agencies decided to take the work into their own hands. They could more tightly control and tailor contracts to suit their needs, she said.

Although the competition among contracts often brings better value and lower prices, too much overlap can have the opposite effect, Johnson said, adding that she doesn’t believe GSA should be a monolithic source for purchasing.

Read the story: WashingtonTechnology.com - GSA nominee faces Senate panel and charms 'em

Acquisition work a tough sell

2009-06-03T19:52:00.004-04:00

Bureaucracy, lack of prestige drive away potential workers

With the summer hiring season getting under way, the federal government would appear to be in a perfect position to expand the ranks of its acquisition workforce, if only it could stop driving away potential hires.

The good news is that the job market is swamped with college graduates looking for work — and some seasoned professionals who are re-entering the job market for financial reasons.

The federal government, which some workers might have avoided in years past, should be an attractive employer because it offers something many companies cannot: stability.

But then there is the bad news: The federal government is still a bureaucracy. New employees are likely to be frustrated by their lack of decision-making authority and little opportunity to try innovative ideas.

“The federal government is sitting in a pretty good place right now,” said Steve Kempf, assistant commissioner of acquisition management at the General Services Administration’s Federal Acquisition Service. “But I’m not sure we’re going to stay there.”

Several years ago, Congress gave agencies some help by granting them direct-hire authority for acquisition-related positions. That means managers can hire new employees themselves rather than going through the cumbersome process at the Office of Personnel Management.

Congress has also allocated money for agencies to set up booths at job fairs, making it possible to reach potential hires who might not have considered government work.

Once the new employees have been hired, officials often take them on field trips. A visit to a Coast Guard cutter or air traffic control tower shows the new recruits how their work helps the government and country. Many experts say people take more pride in their jobs when they know what their participation brings the government.

However, the thrill of such visits fades fast, leaving new employees wondering what the future holds for them. “You have to have a path to success, and right now the government doesn’t provide that,” said Max Stier, president and chief executive officer of the Partnership for Public Service. There are a number of barriers to success, he added.

The acquisition field has some unique obstacles, experts say. At most agencies, contracting officers are considered less important than they once were, giving the job less prestige and visibility despite its importance to agencies’ success, said Kempf, a career acquisition employee.

“I think we’ve lowered them in the food chain,” he said. When Kempf entered the field two decades ago, contracting officers were revered and had their own offices. Today, they’ve been downgraded to cubicles, he said.

That demotion leaves the contracting officer as simply another step in the purchasing process. But procurement skills should be a core competency because they involve negotiating prices, researching the marketplace, reviewing proposals and awarding contracts on a basis that will withstand protests, said Alan Chvotkin, executive vice president and counsel at the Professional Services Council.

However, once they’ve chosen the acquisition field, employees have no incentive to pursue a career in government procurement, experts say.

“Frankly, they have every reason to fear for their careers,” said Steven Schooner, an associate law professor and co-director of the Government Procurement Law Program at George Washington University.

Congress, watchdog groups and the news media criticize the acquisition community and pounce on mistakes regardless of whether they are fraud or honest errors.

“Competing with the environment we have now, we will find every way to push them out the door,” Kempf said. Bosses will criticize acquisition employees for every mistake they make, even when they’re still learning, he said. The employees who were wowed at the job fair by the stories of being the United States’ buyer will find they don’t have the job that had piqued their interest. Agency managers won’t trust them to judge situations and will instead give them less challenging work, he added.

Younger workers recognize that situation and are not attracted to acquisition.

“The jobs just don’t smell good,” Schooner said.

Meanwhile, young employees can easily be attracted by the private sector’s portrayal of opportunities for leadership, excitement and playing a part in something that’s going to change the world. Companies can woo them with more money and benefits, too.

Beyond the younger generation, the government retirement system creates incentives for experienced career employees to leave for the private sector, taking their knowledge with them, said Rep. Darrell Issa (R-Calif.), a member of the congressional Smart Contracting Caucus and ranking member of the House Oversight and Government Reform Committee.

As the government faces that workforce shortage, its spending has increased dramatically in recent years — nearly doubling since 2000 — and the size of the workforce has increased only minimally. As a result, contracting officers’ jobs now require getting as much done as possible in a short time, despite the fear of a news-making mistake, experts say.

“Their incentive is volume,” said John Needham, director of acquisition and sourcing management at the Government Accountability Office.

Read the story: FCW.com News - Acquisition work a tough sell

GSA to make new bid for agency customers

2009-05-27T20:33:00.003-04:00

GSA to offer contracts in the areas of cloud computing, transparency

The General Services Administration is gearing up to offer help to federal agencies looking to participate in the Obama administration’s initiatives on transparency and cloud computing, a GSA official said today.

GSA hopes to win customers that otherwise might have developed their own contracts or services.

“We see the administration’s requirements, we respond by initiating some kind of contract action, and make it fast and easy for government agencies to use,” said Ed O’Hare, the new assistant commissioner for Integrated Technology Services (ITS) at GSA's Federal Acquisition Service. He spoke at a FedSources breakfast meeting.

Obama administration officials have created numerous Web sites, such as Recovery.gov and Data.gov, to offer more information to the public. The new chief information officer, Vivek Kundra, is also moving ahead on the use of cloud computing.

O’Hare described cloud computing as a data center wrapped up with software as a solution. He wants to make it possible for agencies to buy such services using government credit cards, especially when they’re under deadline.

“You don’t have to go to the CIO, you don’t have to go plan it, you don’t have to go buy servers or digital maps or do” certification and accreditation, O’Hare said. Instead, he would like agencies to be able to log onto a Web site, answer a few questions about their needs and then, “Boom, check out, you got it.”

With O’Hare as the chief of ITS, experts now expect greater attention to day-to-day operations. They say he has been on the industry side of GSA and worked inside the agency, and therefore understands how ITS runs.

When John Johnson retired earlier this month as assistant commissioner for ITS, major contracts had been awarded and customers were placing orders. That leaves O’Hare to deal with how the office runs.

“My job is to make it work,” O'Hare said. He wants to make ITS and GSA’s information technology services faster, better and cheaper than what other agencies can offer.

He also talked about reducing the time it takes to get an IT contract on GSA’s Multiple Award Schedules program. Contractors are frustrated because it can take months to get on the IT Schedule 70 or modify one of those contracts.

“I know we’ve got to do better,” O’Hare said.

Read the story: FCW.com News - GSA to make new bid for agency customers

Obama signs law to reform weapons buying

2009-05-23T10:45:00.008-04:00

The law puts checks on big-ticket weapons acquisitions to keep them on schedule and hold down costs.

President Barack Obama signed legislation yesterday to change how the Defense Department buys and tracks acquisitions of major weapons systems.

“When it comes to purchasing weapons systems and developing defense projects, the choice we face is between investments that are designed to keep the American people safe and those that are simply designed to make a defense company or a contractor rich,” Obama said before signing the bill.

The Weapons Systems Acquisition Reform Act (S. 454) requires DOD to appoint senior officials to assess a project’s performance and analyze underlying causes for any of its shortcomings, such as unrealistic expectations, too little funding, or poor work by a contractor or DOD.

It requires officials to encourage competition, including 10 competition-promoting measures to consider when setting acquisition strategies. It also deals with organizational conflicts of interest, requires a study of earned value management, and sets checkpoints at certain milestones in projects.

The law's purpose is to limit cost overruns before they spiral out of control, Obama said. "Wasteful spending comes from exotic requirements, lack of oversight and indefensible no-bid contracts."

Obama also said this is the first step in fixing how the government buys things. “It reforms a system where taxpayers are charged too much for weapons systems that too often arrive late,” he said. Obama signed a memo March 4 designed to improve the procurement system.

However, acquisition experts say the vast majority of purchases are received as agencies requested.

“By and large the government gets what it wants, when it wants it, for the price it’s wiling to pay,” said Alan Chvotkin, executive vice president and counsel at the Professional Services Council, who spoke this week at a panel discussion about the federal acquisition workforce. However, he said the procurement system still has room for improvements.

At the same discussion, Steven Schooner, an associate law professor and co-director of the Government Procurement Law Program at George Washington University, pointed out the Obama administration views contractors as lining their pockets at the taxpayers’ expense. Schooner said the president, Congress and the news media can’t treat contractors as pariahs because the government can’t operate without contractors’ support.

Read the story: FCW.com News - Obama signs law to reform weapons buying

Experts: Acquisition jobs offer few incentives

2009-05-20T17:39:00.002-04:00

Federal contracting careers losing appeal

Federal acquisition employees have no good reason to continue their careers in government procurement, a panel of experts said May 19.

Contracting specialists have been relegated to ordinary positions at agencies after once being held in high esteem, said Steve Kempf, assistant commissioner of acquisition management at the General Services Administration’s Federal Acquisition Service.

“I think we’ve lowered them in the food chain,” said Kempf, a career acquisition employee. When Kempf entered the field two decades ago, contracting officers were revered and had their own offices. He said today though they’ve been downgraded to cubicles.

His point was an underlying theme of a discussion among eight government acquisition experts hosted by the congressional Smart Contracting Caucus. They said the acquisition community is being criticized by Congress and the news media, which pounce on mistakes regardless of whether they are fraud or honest errors.

“Contracting officers get beat down a lot,” Kempf said, adding that one mistake could end a career.

“Frankly, they have every reason to fear for their careers,” said Steve Schooner, an associate law professor and co-director of the Government Procurement Law Program at George Washington University.

Scott Amey, general counsel at the Project on Government Oversight, said oversight and accountability aren’t punishment. However, overseers inside and outside government need to determine when an error is fraud or an honest mistake.

Despite the fear of making a career-ending error, contracting officers today focus on accomplishing as much as possible in a short time, the experts said.

“Their incentive is volume,” said John Needham, director of acquisition and sourcing management at the Government Accountability Office.

Government spending has increased dramatically in recent years — nearly doubling since 2000 — and the size of the overall workforce has increased only minimally. The workload pressures are stressful for acquisition employees. They hope they don’t make a major mistake, but they don’t have time to check all the details of each acquisition, experts said.

There are few other incentives for acquisition employees to stay with the government. The private sector can offer them more money and benefits. Furthermore, the government retirement system creates incentives for employees to leave for the private sector, said Rep. Darrell Issa (R-Calif.), a caucus member and ranking member of the House Oversight and Government Reform Committee. Experts also said it takes months to get a job with the government because of its broken hiring system.

Overall, the field has lost its luster because it’s now an administrative job, the panelists said.

Members of the younger generation recognize that and are not attracted to the acquisition field. Schooner said the descriptions of government openings on USAJobs.gov are generic and boring. “The jobs just don’t smell good,” he said.

Read the story: FCW.com News - Experts: Acquisition jobs offer few incentives

Supplemental bills would restrict award fees

2009-05-16T09:37:00.005-04:00

Congress is working to restrict award fees for contractors’ work.

The House passed its fiscal 2009 Supplemental Appropriations Act (H.R. 2346) on May 14 with a provision that would not allow the Defense Department to spend its money on award fees to defense contractors unless DOD judged their work using set criteria.

The bill would boost the importance of the guidance on award fees in the fiscal 2007 National Defense Authorization Act. That law required the defense secretary to write rules on how DOD should appropriately link award fees to acquisition outcomes. The law bolstered checks on what is good contractor performance worthy of the extra money.

In particular, the authorization law required, among other things, guidance on how to judge performance, determine if a contractor should get even a percentage of the award for satisfactory work, and analyze whether award fees actually work to improve contractors' work.

Also on May 14, the Senate Appropriations Committee also approved its version of the supplemental bill (S. 1054) that has a similar provision that would restrict award fees.

The provisions align with a March 4, 2009, memo from President Barack Obama designed to stop the use of cost-reimbursement contracts, including ones that would pay for contractors’ cost plus an award fee for reaching certain performance measures.

“We will end unnecessary no-bid contracts and cost-plus contracts that run up the bill that is paid by the American people,” Obama said at a press conference in March. Obama predicted his reforms would save the government $40 billion each year.

Read the story: FCW.com News - Supplemental bills would restrict award fees

Acquisition Workforce: Clerk vs. Businessman

2009-05-14T20:41:00.006-04:00

Government officials have been concerned for several years about the coming wave of retirements by federal employees, especially in the field of acquisition. But the Obama administration sees a real upside.

In its fiscal 2010 budget proposal’s Analytical Perspectives, the administration writes:

The retirement wave also presents an opportunity to reform and re-energize the federal workforce by re-evaluating what the workforce does and how it does it. It will provide an opportunity to transform the government’s workforce capacity to address 21st-century challenges by implementing 21st-century systems and processes to acquire, develop, engage, compensate, recognize and effectively retain talented employees.

At a procurement conference on Thursday, a former Army contracting officer said the retirement wave will allow the acquisition workforce to become a new breed of thinkers and strategists. And the days of procurement clerks who have for decades pushed their papers and rarely taken time to consider business strategies will fade away, he said. Meanwhile, he said the incoming workforce will arrive with a business-savvy outlook, instead of the bureaucratic rubber-stamping of program managers’ demands.

He said the retirees’ replacements will come with a 21st-century mindset and want to be more involved throughout the process. They will want to find the best solutions for a contract — sort of like bargain hunters. The incoming generation of new workers wants to make a difference in their field, and that will make a huge difference in contracting. The incoming generation won’t clock out of work as soon as their shift is over as “the clerk generation” does, he said but they will stick around until the work is done.

That workforce will also learn that the actual procurement is only one small piece of a broader process known as acquisition. It’s a change in thinking that acquisition leaders are trying to incorporate today. Purchasing along with planning out strategies before and managing contracts after they’re awarded entail acquisition. Contracting officers, contracting officer’s technical representatives and even program managers are parts of the acquisition.

However the former contracting officer said, the mentality of the 21st-century workforce may not take hold until the retirement wave hits.

Will the retirement wave have such an effect?

IG finds conflict in the acquisition regulation

2009-05-07T16:36:00.003-04:00

The Federal Acquisition Regulation may have conflicting language, Defense Department auditors said in a report.

The FAR requires that small businesses get an advantage over other companies if a contracting officer can find two responsible small companies that can offer reasonable bids. That is known as the Rule of Two, and last year the Government Accountability Office ruled that it applies to task and delivery orders.

Meanwhile, another section of the FAR states: “The contracting officer must provide each awardee a fair opportunity to be considered for each order exceeding $3,000 issued under multiple delivery-order contracts or multiple task-order contracts.”

In a report released May 6, DOD's inspector general’s office found the conflict as it audited the Navy’s SeaPort Enhanced (SeaPort-e) indefinite-delivery/indefinite-quantity contracts.

The IG’s auditors said the SeaPort-e program manager failed to adequately compete 39 of 133 audited task orders when the manager allowed small business set-asides. The 39 orders were worth $469.3 million. The program manager deviated from the FAR by not ensuring contracting officers performed adequate market research on the small business set-aside task order contracts. As a result, Navy officials may not always receive the best value for the SeaPort-e customer, the IG said.

However, the manager argued that the Small Business Administration supported the set-asides and large contractors signed agreements that included language on the set-asides. Nevertheless, the IG wrote, “Neither the SeaPort-e program manager nor the Small Business Administration has the authority to override” the fair opportunity provision of the FAR or the statute on which it's based.

The Defense Acquisition Regulations Council and the Federal Acquisition Regulations Council should determine if the FAR needs more specificity on what’s allowed when setting aside a task order for small businesses, the IG wrote. Navy Department officials intend to bring up the conflict to regulators for a clarification, the report states.

In the IG’s discussions with GAO's General Counsel Office, GAO said its October 2008 decision on the Rule of Two has caused confusion on the topic of small-business set-asides and full competition. GAO officials said legislative action will likely be necessary to clarify the intent of the Rule of Two, according to the IG’s report.

The Rule of Two is in FAR Part 19. The fair opportunity provision is in FAR Part 16.

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The hidden force in acquisition

2009-05-04T10:22:00.004-04:00

Some of the most influential people in the federal acquisition community are also the least well known.

They make critical decisions at every step of the acquisition process, yet the Federal Acquisition Regulation does not mention them. Any reform initiative that does not take them into account is bound to fail, yet the Office of Federal Procurement Policy rarely takes note of them in memos.

But that is beginning to change. Slowly but surely, federal agencies are coming to realize that contracting officer’s technical representatives (COTRs) play an essential — if underappreciated — role in government contracting.

Even the Government Accountability Office is trying to get a handle on the community.

“We have no really clear picture of how many of those there are, what their training and skills are, and so forth,” said John Needham, director of acquisition and sourcing management at GAO, during an April 28 congressional hearing on the Defense Department’s acquisition workforce. “That’s one area we saw as a need.”

COTRs serve as a vital link between their better-known colleagues — program managers and contracting officers — and help translate operational requirements into executable and manageable contracts.

“They’re the principal people who bring these worlds together,” said Robert Burton, former deputy administrator at OFPP and now a partner at Venable law firm.

COTRs also keep tabs on how well contractors are meeting their requirements. Agencies have learned the hard way that they cannot hand that task to new employees or pile it on an already overworked acquisition staff.

So as contracting spending rises and the complexity of contracts increases, COTRs have become the linchpin of government contracting.

Performance pressure points

Agencies are finally beginning to appreciate COTRs because agencies are spending much more money on services compared to a decade ago. For example, DOD spent $202 billion through services contracts in 2008, compared to $92 billion 2001.

“There are a lot more moving parts to keep hold of and a lot more contracts to manage today,” said Mary Davie, assistant commissioner of the Office of Assisted Acquisition Services at the General Services Administration’s Federal Acquisition Service.

Davie took a job as a COTR in 1989, when she was 23 years old. It was a good way to get some on-the-job training, she said. She made sure that products came in on time and in good condition. “They were sort of turning to me for getting what was needed and keeping the project on schedule,” she said.

In recent years, agencies have been under pressure from the White House and Congress to determine whether they are getting their tax dollars’ worth from contracts, said Elizabeth Miller, vice president of Government Horizons, a nonprofit acquisition training organization.

Therefore, they are trying to develop more sophisticated ways to measure contractor performance. Those metrics and disciplines such as earned value management can get complicated when it comes to technical services contracts.

COTRs are responsible for building such metrics into contracts and sounding the alarm when contractors go astray. Communication must happen early and often, Miller said. “It’s not about waiting for the monthly progress report to find out, ‘Oh, we have a problem.’”

Davie said COTRs also explain to contractors what the program managers need and what the contracting language requires of them.

In addition, COTRs must keep in close touch with contracting officers about progress and suggest modifications if things are off kilter, experts say.

“The COTRs go back and forth,” Burton said.

COTRs come of age

With President Barack Obama’s push to put more contracting information online for public consumption, several experts said COTRs’ duties will become more visible, which will force them to manage projects even more carefully.

With billions of stimulus dollars to spend, the increased burden on COTRs worries many inspectors general. They know agencies will have their hands full managing that money, which comes with new demands from the administration to track where the money is going and what it yields.

Numerous IGs have issued reports recently detailing their concerns about their acquisition workforces. The American Recovery and Reinvestment Act’s requirements seem to demand larger acquisition workforces than agencies have. Existing employees are already struggling to manage increasing sums of money and transactions, even without the stimulus funds.

Procurement officials expect that actions associated with the stimulus funding will be complex, requiring more rigor and oversight. That will, in turn, increase the demands on COTRs and other contract specialists, according to a recent report from the Energy Department’s IG.

In today’s environment, COTRs can’t be young people fresh out of college, as they often were in the past, officials say. They must be savvy and experienced experts in their fields who understand both the procurement and program management sides of acquisition.

In recent years, “there was a shifting expectation for a higher level of competence in understanding and collaborating on the ‘how’ versus the ‘what,’” said Chuck Harris, a former Air Force contracting officer and now president and chief executive officer of Inflection Point Solutions, a training and consulting company.

It hasn’t always been that way. DOD, the world’s biggest buyer, has not always filled the slots for contracting officer’s representatives -- DOD's equivalent to the COTR -- with the best people. It is not uncommon for CORs overseas in war zones to have no training. And generally, all COR training is geared for times when operations are slow, so it is barely adequate when situations get tense, the Senate Armed Services Committee wrote in a report last year.

Assigning a soldier to the role of a COR would seem like a good way to boost someone’s career by providing a launching point into the contracting field. But too often, the soldier who takes on that role doesn’t have any relevant experience, the committee wrote. Then the situation gets worse.

“The COR assignment is often used to send a young soldier to the other side of the base when a commander does not want to have to deal with the person,” the committee wrote.

The Army wants to correct the situation. Officials are spreading the word about CORs’ role in contracting and are teaching Army commanders, staff members and people outside contracting the value of CORs.

“The COR’s role is key to ensuring that the government is getting what it is paying for with appropriate oversight,” Edward Harrington, deputy assistant secretary of the Army for procurement, told a House subcommittee in March.

In April, Jeffery Parsons, executive director of the year-old Army Contracting Command, said an entire division is dedicated to fixing its COR program. And the Army published the “Deployed COR Handbook” to supplement CORs’ training when they’re out in the field.

Sizing up the COTRs

But even as COTRs grow in importance and receive more recognition, officials are still struggling to form a clear picture of the community.

One official called it a mysterious group because agencies and analysts know so little about them. They’re often hidden behind full-time jobs in areas such as information technology or engineering.

In its 2008 report on the acquisition workforce, the Federal Acquisition Institute said it couldn’t identify COTRs because agencies’ records and official guidance about them are so ambiguous. It deferred analysis of COTR demographics until the role is better defined and agencies keep better records.

Officials recognize that the COTR’s role is also growing in importance because the future of government contracting will likely mirror the recovery act rules.

“The program managers rely on them, and the contracting officers rely on them,” Burton said. “They’re really the bridge.”

Read the story: FCW.com News - The hidden force in acquisition

GSA schedules might get state, local business

2009-05-01T17:48:00.005-04:00

Cities and states soon might have more access to the General Services Administration’s Multiple Award Schedules contracts, if several new bills reach the president’s desk.

Last week, Edolphus Towns (D-N.Y.), chairman of the House Oversight and Government Reform Committee, introduced legislation that would allow state and local governments to use stimulus money to buy from among the more than 11 million supplies and services available on the schedules contracts.

Towns’ bill, the Enhanced Oversight of State and Local Economic Recovery Act (H.R. 2182), pushes forward his notion that the schedules contracts should be open to more than federal agencies. In 2008, President George W. Bush signed Towns' Local Preparedness Acquisition Act, which gave states and cities access to law enforcement and security-related schedule contracts.

Similarly, Rep. Kendrick Meek (D-Fla.) introduced the Green Acquisition Act (H.R. 1766) on March 26. It would grant state and local governments access to the schedules contracts for environmentally preferable commodities and services. The bill was sent to Towns’ committee for consideration, and the legislation received a positive response, said Adam Sharon, a spokesman for Meek.

Meek introduced the bill after talking with several Miami-Dade County officials about the money they would save by buying green products from the federal schedules contracts.

“The ability to obtain green goods and services with this method will make our taxpayers’ dollars go a long way,” County Commissioner Sally Heyman said in April. She estimated that state and local governments would add $1 trillion in additional sales annually by opening GSA’s schedules.

Since 2002, state and local governments have been allowed to buy information technology products and disaster recovery products from GSA schedules using cooperative purchasing agreements.

Those agreements have boosted GSA’s sales on its IT Schedule specifically. Orders from states and localities jumped from $17.9 million in fiscal 2003 to $521.8 million in 2008, according to Input, a market research firm. And 2009’s orders are outpacing 2008, despite the economic downturn.

Read the story: FCW.com News - GSA schedules might get state, local business

Officials: Recovery act rules are the future

2009-04-27T14:05:00.004-04:00

The strict acquisition regulations attached the stimulus money is a foretaste of what agencies and contractors can expect for the future, several government officials said in speeches April 23.

The American Recovery and Reinvestment Act, has many transparency requirements, a strong emphasis on firm-fixed-price contracts and competition for those contracts, and demands for tracking the money to show what it yields. Procurement officials say these levels of transparency and oversight have never been demanded in such ways, and it’s only the beginning of what’s to come. A precedent has now been set, many experts have said.

“The stimulus is the wave of the future,” Soraya Correa, director of procurement operations at the Homeland Security Department, said at an event hosted by the American Small Business Coalition.

General Services Administration officials who also spoke said the law's requirements force agencies to keep a closer tabs on what they spend and how they spend it because the information will be public on Recovery.gov and agencies' own recovery Web sites.

“With revenue comes responsibility,” said Amanda Fredriksen, GSA’s deputy assistant commissioner for general supplies and services.

To boost transparency, the law requires agencies to publicize their bid proposals. Even if an agency buys a product or service from a GSA Schedule contract, the agency has to post a notice on the Federal Business Opportunities Web site for the sake of announcing it, which wasn’t required in the past.

The requirements will also reach into contractors’ books, officials said. Agencies will ask contractors for their spending and subcontracting information. And to remain in GSA’s Schedules program, companies must agree to adhere to the new requirements. GSA officials said companies can expect to hear from the agency soon.

“That means your data is out there,” Correa said to a group of small-business owners, adding that they need to make sure their books are in order and presentable because the information could be posted on the Internet.

David Drabkin, GSA’s acting chief acquisition officer, said the transparency theme has been moving ahead for at least two years. In December 2007, the Office of Management and Budget launched USASpending.gov as part of a law that then-Sen. Barack Obama helped introduce legislation known as the Federal Funding Accountability and Transparency Act. While in Congress, he introduced a follow-up, which would have provided more information on the government’s contracting system, but it never became law.

In his same spirit of openness, the stimulus law, which pushes for contracts with nonadjustable prices, requires agencies to share their reasons for why a contract couldn’t be awarded with a set price. In the past, those justifications have stayed within the agency.

“People are going to be able to read the excuse you’re giving, and people are going to hold your feet to the fire,” Correa said. That likely will lead to more discussions between agencies and industry through more draft requests for proposals, in-depth market research and outreach to a broader range of companies, she said.

Drabkin said the stimulus spending reflects President Obama’s March 4 memo on his proposals for procurement reforms, such as greater competition for work, a preference for firm-fixed-price contracts, more transparency from agencies, and a stronger workforce to handle the immense amount of contracting work flooding into agencies.

Read the story: FCW.com News - Officials: Recovery act rules are the future

Bid protests keep pace with DOD spending

2009-04-16T12:14:00.008-04:00

The number of protests against the Defense Department's contract awards has grown at the same rate as the department’s spending has increased over the past several years, according to a recent report.

The Government Accountability Office has handled as few as 458 bid protests filed by companies against DOD’s contract awards in fiscal 2004 and as many as 540 protests in 2007, GAO reported April 14. In 2008, the protests increased to 611, a 23.9 percent jump compared with 2007, the largest margin in past four years, GAO said, adding that the greatest increase had been 17.9 percent in 2005.

GAO also said 2008’s increase comes from its expanded protest jurisdiction. The fiscal 2008 National Defense Authorization Act granted federal employees involved in a public-private competition for government work to protest a decision to outsource the work to the contractor.

Excluding protests in the expanded jurisdiction, GAO said the protest number rose to 581, or 17.8 percent, over 2007.

GAO put the increase in context of DOD’s spending. Despite the 17.8 percent jump, DOD spent 15.7 percent more money in 2008, compared with the previous year’s spending. “These similar rates of increase may suggest that the increase in protests was due in part to DOD’s increase in procurement spending,” GAO said.

GAO also said during the last two decades, the number of bid protests against both DOD's and civilian agencies' award decisions has declined. In 1989, companies filed 1,490 protests against DOD's award and 750 against civilian agencies’ decisions. In 2008, there were 611 protests against DOD's decisions and 416 against civilian agencies' decisions. The total number of protests against defense and civilian awards peaked in 1993 with 2,336 and has continued downward since, according to GAO’s figures.

Congress required GAO in the fiscal 2009 National Defense Authorization Act to assess bid protest trends; some members of Congress are concerned about frivolous protests. The House Armed Services Committee wrote that bidders seem to automatically file a bid protest if they lose a competition for a contract.

When a company files a protest, the matter goes before GAO. A group of 30 attorneys in GAO’s Office of General Counsel, who serve as hearing officers, address a company’s allegations that an agency acted contrary to procurement law or its contract solicitation.

Read the story: FCW.com News - Bid protests keep pace with DOD spending

Martha Johnson may bring old era back to GSA

2009-04-06T16:56:00.003-04:00

Martha Johnson, the nominee for the top job at the General Services Administration, could bring back an old era of good times at GSA that many inside and outside the agency are already bubbling about, several experts said today.

Johnson, who was chief of staff for then-GSA administrator David Barram from 1997 to 2001, is someone agency employees consider to be one of their own, those experts said.

“She knows GSA inside and out, and she knows almost all of the people there,” said Dennis Fischer, who was GSA’s Federal Technology Service (FTS) commissioner 1997 to 2001.

He has received e-mail messages from numerous agency employees who are excited by the news that President Barack Obama picked Johnson as his nominee to lead GSA, said Fischer, who’s now a consultant.

“I think the place is probably electric,” he said.

The White House made its announcement about Johnson's nomination late April 3, and the e-mail messages quickly began arriving in Fischer’s inbox, he said. Bob Woods, former FTS commissioner at GSA from 1994 to 1997 and now president of Topside Consulting, said a large number of retired GSA officials expressed interest in returning to the agency because Johnson could be back. “That says a lot,” he said.

Unlike recent administrators, Johnson has experience inside GSA, which would give her an advantage in improving an agency that has suffered through contracting crises, lost business as customer agencies do their own contracting work, and leaders who lacked a deep understanding of the agency.

“GSA can’t be another place for someone to learn,” Woods said. Johnson's "disposition is great, but it’s her experience that is what’s needed.”

Johnson served as co-lead for the Obama Presidential Transition Agency Review Team for GSA. That work gave her a close look into what had been happening at the agency during the previous administration, several experts said, adding that the information would serve her well.

Johnson has been vice president of culture at Computer Sciences Corp. since 2007. As vice president, she helps direct the change in culture of the 90,000-person corporation.

GSA's Public Building Service (PBS) is likely to grab Johnson's attention as stimulus money pours into making federal buildings more energy efficient, said Larry Allen, president of the Coalition for Government Procurement.

“The congressional and public interest is high in how Public Building Service funds are dispersed,” he said.

Fischer and Woods said GSA's Federal Acquisition Service won't be forgotten. They said PBS has longtime officials who know how the organization operates, which will free Johnson to boost FAS’ reputation. Woods said that when GSA formed FAS by merging the Federal Supply Service and FTS, it lost two brand names that were central purchasing organizations. GSA must continue to rebuild its name, he said.

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Stimulus funds bring acquisition showdown

2009-03-29T22:30:00.018-04:00

Two organizations are preparing for new business and intense scrutiny

Pop quiz: Take a limited number of federal acquisition employees, add $787 billion in stimulus spending, then square the root with a requirement to spend the money as fast as you can. What have you got?

Anyone familiar with the federal contracting process can tell you that's a no-brainer: It’s algebra for procurement meltdown.

So if there were ever a time when the already beleaguered contracting community needed a white knight, the moment is now. The fact has not escaped the attention of officials in the General Services Administration’s Office of Assisted Acquisition Services (AAS), nor of those at the National Business Center’s Acquisition Services Directorate, known as AQD. The two centers are designed to be full-service acquisition support operations, ready to serve any other federal agency willing to pay them for their services.

Indeed, both AAS and AQD are speeding to the stimulus rescue, each hoping to be the first on the scene in a highly competitive — and image-repairing — procurement services process. It’s already shaping up as the acquisition showdown of the century.

Officials at both organizations say their experts are ready to step in and put stimulus-related spending on the fast track. They both can manage customer agencies’ entire procurement process from planning, soliciting and evaluating bids to awarding and administering contracts.

Those organizations exist for just this reason: to augment an agency's existing acquisition staff when the workload gets too big or a project needs special attention. And because they fund their respective operations through service fees, they have a vested interest in generating new business from the stimulus jackpot.

But there’s also more to it than that. In recent years, the procurement practices of both AAS and AQD have come under fire, particularly from the Defense Department, which spurred a decline in business and customer confidence. The stimulus package provides an opportunity to recover both.

But that opportunity also comes with risk. The business could come fast and furiously, and both centers will be under intense scrutiny from Congress, inspectors general and the Government Accountability Office, all of whom will be ready to jump on any missteps or irregularities.

“This is a tremendous opportunity,” said Phil Kiviat, partner at Guerra Kiviat and a former acquisition official at GSA. “It’s an opportunity for success but also for failure if they don’t meet the demands.”

The Sales Pitch

Recognizing the stakes, AAS and AQD officials are visiting current clients and developing marketing campaigns to reach new ones, and they consider every agency to be a potential customer.

AAS is holding all-day events to brief agencies on acquisition services. AQD representatives are speaking at events, buying booth space at trade shows, such as FOSE — which is owned by the parent company of Federal Computer Week — and buying advertisements in magazines, including FCW. Neither organization would disclose how much money they spend on marketing.

Mary Davie, GSA’s assistant Federal Acquisition Service commissioner for assisted acquisition services, and John Nyce, AQD’s associate director, each spoke at an industry event March 16 about the stimulus money and what they offer.

“I’ve always got to give my commercial,” Davie told the crowd. “We’ve got project managers, contract specialists and contracting officers that can actually help agencies.”

Nyce made a similar pitch for AQD. “You’ll get the best service for your money,” he said.

Davie and Nyce are confident their respective organizations have recovered from past mistakes, though to some extent, they are still paying the price.

GSA’s problem was primarily one of positioning, experts say. Agencies were not interested in GSA’s cradle-to-grave contracting services so they began running their own contracts. GSA's acquisition services business plummeted from $7.7 billion in 2004 to $3.6 billion in 2008.

But GSA also ran into problems with DOD. The department's inspector general criticized DOD and GSA for not enforcing contracting policies.

The low point was in fiscal 2006, when Davie’s office was $156 million in the red. In 2007, GSA reduced overhead by reassigning approximately 250 staff members and restructuring its service offerings. In fiscal 2008, the office was back in the black by $5 million, although its revenue was half of what it had been four years earlier.

AQD, which was once known as GovWorks, has suffered similar travails. In 2007, DOD banned the use of GovWorks for any business worth more than $100,000, until the center improved its process for tracking and documenting transactions. Until that point, DOD had accounted for nearly two-thirds of GovWorks' business.

However, DOD’s move had a silver lining: it forced GovWorks to re-evaluate itself, Nyce said in 2007. To improve its processes, AQD turned to the International Organization for Standardization, earning ISO 9001 certification in 2008. The center, like AAS, also scaled back its services, realizing it could not be all things to everyone. After topping $2.7 billion in annual contract obligations in 2005, AQD’s business was worth only $1.35 billion in 2008, and projections for 2009 are between $1.6 billion and $1.9 billion. The agency said it recovered all of its costs during those years.

DOD lifted its ban on big-ticket contracts with AQD in 2008.

Nyce said he doesn’t duck the issue if a customer questions him about his track record. “I deal with fact if they bring it up,” he said.

This time though, he said, “we will accept no work we are not capable of doing, and we will work to do it right.” AQD will take as much work as possible but won’t overextend itself, which Nyce said invites big problems.

Money on the table

The demand will be intense, in terms of the amount of money and the time allotted to spend it.

The Energy Department, for example, received $32.7 billion in new budget authority from the stimulus package, half of which is for investing in energy efficiency and renewable energy sources. The Agriculture Department is getting $28 billion.

GSA’s Public Building Service received $5.5 billion in money from the recovery act, mainly for repairing and renovating federal buildings. GSA is considering 200 projects covering all 50 states. The Interior Department received $3 billion and is scanning its five-year project plan to find ways to spend its money.

According to the recovery act, those departments and other agencies must obligate the funds by mid-June. But the two centers and their customers cannot afford to get sloppy.

“This is a surge in federal spending,” said Ray Bjorklund, senior vice president and chief knowledge officer at FedSources. “If you don’t follow the rules, you will have the big spotlight on you.”

The Obama administration wants a specific accounting of where the stimulus money flows, with that information made readily available to the public on the Recovery.gov Web site. The agencies also have to keep regularly appropriated money separate from the recovery act money. Commingling is not an option.

“There’s a lot of work," Davie said. "There’s a lot that we need to be aware of.”

Nyce added that “we are scrambling to put processes and procedures in place,” just as much as the agencies are scrambling to designate the money for specific projects.

The work will soon begin. But the outstanding question is who will get it. If agencies decide to turn to outside help on any given project, they must choose between AAS and AQD. In their recent joint speaking appearance, Davie and Nyce sold their respective centers' work while playing down the idea that they are in fact competitors.

But Deidre Lee, director of Compusearch Software Systems' defense and intelligence unit, who attended the industry event, said they do compete against each other despite what they say for public consumption. “Agencies have to decide who they go with,” she said.

Their track records will likely play out in clients’ decisions about which service provider to go with, Lee said, adding that speed and efficiency will be deciding factors.

In the end, said former GSA official Kiviat, agencies won’t be wondering whether one center will charge a lower fee versus the other. The question will be who can get the work done.

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Contractors wary of procurement proposals

2009-03-29T12:10:00.019-04:00

President Barack Obama’s call for acquisition reform might lack the details needed to succeed

Cliff Thomas, president of ABC Management Technology Solutions Inc., of Chantilly, Va., is skeptical about contracting reform after listening closely to President Barack Obama speak in March about his federal procurement proposals.

The president’s speech offered few details about his plan to solve what he perceives as flaws in the government contracting process, and it left Thomas frustrated.

“He did no more than give a political speech,” Thomas said. “He’s the president. He doesn’t need to give political speeches.”

Thomas and others in industry wanted details about the reforms. For example, Obama said he would “open up the contracting process to small businesses.” But that was the extent of his remarks on small businesses. Thomas pointed out that helping so-called Main Street was a major theme in Obama’s presidential campaign.

From what they heard, many information technology companies contracting with the government didn’t consider Obama’s proposed procurement reforms as anything approaching a sea change. The proposals were unclear, and some were already in place.

For instance, contracting regulations already favor fixed-price contracts as the safe and preferred method instead of cost-reimbursement and especially time-and-materials contracts. Many experts doubted that new guidance would improve on that. Instead, contractors intend to continue to plug away at their business. They say they know their roles as aiding their federal customers in reaching their objectives.

Thomas and other business owners said they also recognize the reality of reform.

“Can he change the way work has been done for the last 30 years?” Thomas asked. “No one person can do it.”

Backing the president

Nevertheless, “it makes the most sense to get behind the reforms,” said Tim Conway, senior vice president and managing director at Affiliated Computer Services' Government Solutions Group. The industry must embrace change, he said.

“The real difference, I think, is that the industry is going to have to invest in solutions that are quickly implemented, configurable and built to evolve," he said. "This will enable true fixed-price contracting to occur.”

Companies such as ACS won’t see significant change, though, Conway said. Most of its federal contracts are fixed-price performance-based agreements.

Similarly, AFL Telecommunications LLC, of Monroe, N.C., won’t see much change as a fiber-optics dealer on NASA’s Solutions for Enterprise-wide Procurements governmentwide acquisition contract, said Randy Murphy, the company’s director of government business development. Its contracts are largely fixed-price already.

However, systems integrators working on a completely new program might see agencies at least considering fixed-price contracts as a possibility. But many experts say agencies likely won’t think long and hard about the possibility.

“For a one-of-a-kind project that has never existed, there are too many parts moving to do a fixed-price contract,” said Dennis Christmas, president of Enterprise Solutions Realized Inc., of Marriottsville, Md., an IT services and software company.

In his March 4 memo about reforms, Obama wants to build stronger barricades against contractors that commit fraud or simply those he believes are working too closely to core contracting decisions. He wants forceful management of contracts so agencies achieve their goals and avoid useless spending. He also expects safeguards to protect the government from noncompetitive contracts. The government needs to get away from contractors as much as it can by keeping work in-house, he said.

The contracting community, former federal officials and people inside government say it takes more than speeches from the White House for reform. It takes cultural shift, changing the way the contracting officers, program managers, chief information officers and inspectors general do their work.

For instance, the Internal Revenue Service IG reported in March that agency program managers were writing their contract proposals angled toward cost-reimbursement contracts. And the contracting officers awarded them as such. The result was cost-reimbursement contracts for general operations and maintenance for the service.

“Obama is now choosing to be more aggressive in getting executive agencies to make the right judgments and choosing the right type of contract,” said Ray Bjorklund, senior vice president and chief knowledge officer at FedSources Inc.

Obama might have hurt his chances for reforms, some business owners and former federal officials said.

Obama said the government must uphold a fundamental public trust. “The American people’s money must be spent to advance their priorities — not to line the pockets of contractors or to maintain projects that don’t work,” he said.

Malik Balil, chief architect and procurement strategist at Computer Systems Center Inc., of Springfield, Va., said the company has built a good reputation as an honest broker to the point of telling a customer agency when it doesn’t need its services.

“We live by that creed,” Balil said.

Thomas, a former Marine who was injured while in the military, echoed that attitude. “We’re not trying to rob the government,” he said. “We’re not out here trying to get rich on the back of the taxpayer.” Instead, his intent as a service-disabled veteran-owned small business with 40 employees is to make a living and give people jobs. It’s the way to keep the economy from falling further, he said.

“The way the government does business frustrates me as a taxpayer — forget being a contractor,” he said.

Targeting fraud

Companies intent on exploiting the government exist, though. In March, the FBI arrested Sushil Bansal, president and chief executive officer of Advanced Integrated Technologies Corp., on charges of bribery and money laundering. The FBI also arrested a former employee of Obama’s new chief information officer, Vivek Kundra, on allegations involving contract kickbacks. The employee worked with Kundra in the District of Columbia’s Office of the Chief Technology Officer.

Furthermore, companies abuse small-business certifications. In 2008, the Government Accountability Office reported that it easily found numerous instances of companies cheating the system to get Historically Underutilized Business Zone contract set-asides. GAO also reported in 2007 that contractors were receiving award fees from performance-based contracts even though the companies didn’t meet the contracts’ objectives.

But Obama painted all contractors with an incredibly broad brush, said Angela Styles, former administrator of the Office of Federal Procurement Policy. “Unfortunately, someone failed to realize that for this initiative to be successful, the administration will need the good contractors to lead the charge. By demonizing contractors that follow the law and successfully perform vital services for the United States, the administration lost a critical opportunity.”

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GSA awards three BPAs to shore up support

2009-03-26T20:09:00.006-04:00

The General Services Administration has awarded three more purchase agreements to Integrity Management, Acquisition Solutions, and Technical and Project Engineering for acquisition support services, according to a Federal Business Opportunities notice.

The blanket purchase agreements (BPAs) awarded March 25 mirror the two other agreements GSA awarded March 12 to Integrity Management and Acquisition Solutions. The purpose is to help GSA keep ahead of a large volume of business that is expected to flow through the procurement agency because of the $787 billion economic stimulus law, and officials have said they don’t expect the flow to subside after the initial phases of the spending spree.

The agency said it already has shortages in experienced acquisition employees, and the business stemming from the law will exacerbate that weakness, especially as it will come on top of GSA's regular business. "Hence the ongoing need for acquisition management support services," GSA wrote in the notice.

The BPAs are one year long with four option years and are worth an estimated $100 million, the notice states.

The first two BPAs are for use by GSA’s National Capital Region offices, and the three BPAs announced yesterday are for all 11 regional offices, the notice states.

The BPAs have been established with Integrity Management Consulting as the primary BPA holder and Acquisition Solutions and Technical and Project Engineering as the backup BPA holders for the regional offices, according to the notice.

In another matter, GSA today announced it awarded a $400 million, five-year BPA to Lockheed Martin to manage Federal Acquisition Service’s information technology system operations and program management support.

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Obama again touches on procurement reform

2009-03-25T23:14:00.004-04:00

President Barack Obama and Defense Secretary Robert Gates will soon offer more details on how to reform the federal procurement system, which will include an emphasis on Defense Department contracting, the president said during a news conference.

Obama said March 24 that he and Gates have been searching for ways to offset the more than $1 trillion in debt he and Congress have amassed in Obama’s 65 days in office. Obama said his administration has found ways to save as much as $40 billion through some reforms, a point he made in his speech March 4 when he called contracting reforms a priority for his administration.

Obama again provided no details on reforms in the recent televised news conference, except to say the acquisition changes are “pretty apparent to a lot of critics” yet hard to accomplish.

“I think everybody in this town knows that the politics of changing procurement is tough because lobbyists are very active in this area,” he said, adding that contractors build plants and create jobs across the country. Those plants often get support from House members and senators whose constituents hold those jobs.

Despite upset constituents and members of Congress, DOD and other agencies are losing a lot of money through projects with problems. Many defense contracts' costs increase above the initial estimates by as much as 50 percent while still not working as the projects should, Obama said.

On March 4, Obama discussed a general plan to reform the acquisition process, but many contractors and government officials are skeptical of any significant changes coming from the White House. Many of them have said new procurement policies may come, but changing how agencies' acquisition employees and program managers do their work is where Obama will find real reforms.

Obama has talked about shifting government work away from contractors and bolstering the acquisition workforce to do more government work in-house. He also wants to shift toward fixed-price contracts and increase competition for contracts.

He is intent on finding savings and reallocating agencies’ resources but wants "to make sure that we’re not simply fattening defense contractors,” he said March 24.

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GSA awards BPAs for support services

2009-03-19T19:00:00.004-04:00

The General Services Administration awarded blanket purchase agreements (BPAs) on March 12 to Integrity Management Consulting and Acquisition Solutions for acquisition support services, according to a Federal Business Opportunities notice.

The BPAs will help GSA shore up support to handle floods of Recovery Act money that agencies are likely to funnel through the government’s primary procurement agency.

The BPAs are for one base year and four options years and are worth $100 million based on the expected revenue from all of the regions' similar contracts, which GSA expects to award soon, the notice states.

GSA will use the agreements to support specific projects related to the $787 billion American Recovery and Reinvestment Act. The BPAs will also save money by finding discounts through agencywide mass purchases, the notice states.

All GSA offices, including the Federal Acquisition Service and Public Building Service, can use a primary and a backup BPA specifically established for their region of the country. GSA said it anticipates awarding in the near future the primary and backup BPAs for the remaining 10 GSA regions.

Integrity Management Consulting holds the primary BPA and Acquisition Solutions has the backup BPA for GSA’s National Capital Region and Central Office.

As agencies spend their economic stimulus money, GSA is preparing for a long-term influx of support services. It said it expects agencies’ need for its acquisition services encompasses more than the initial spending spree.

President Barack Obama’s economic stimulus package became law Feb. 17.

The BPAs are through GSA’s Mission Oriented Business Integration Services Schedule contract. GSA can use the BPAs with Recovery Act funds or other purse sources, the notice states.

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17 words that will change acquisition

2009-03-09T06:01:00.013-04:00

Buried deep within the $787 billion economic stimulus law is a small provision, barely noticeable on a quick skim, that could well change the federal government’s procurement practices for years to come.

The provision is just 56 words long, and the core of it is only 17: “To the maximum extent possible, contracts funded under this act shall be awarded as fixed-price contracts.”

President Barack Obama frequently promises change, but the procurement approach of setting a price first and then proceeding with work is old school. Other approaches to federal contracts, such as cost-reimbursement and no-bid awards, have emerged in recent years to give procurement officials more flexibility while accepting more risk.

Obama’s Office of Management and Budget now calls fixed-price contracts “safe investments” for the massive amounts of taxpayer funds going out the door in the stimulus package. Last year, Democratic lawmakers clamped down on cost-plus contracts in the fiscal 2009 National Defense Authorization Act, which became law Oct. 14, 2008. And now, the American Recovery and Reinvestment Act that Obama signed Feb. 17 includes the provision that limits contracts as much as possible to those with fixed prices.

However, many procurement experts are critical, worried that the administration is limiting the use of other contract approaches that have a legitimate place in a contracting officer’s toolbox.

It’s an old debate. While proponents say fixed-price contracts commit companies to performing work for a set amount and allow agencies to budget appropriately, some experts say other contract types offer a flexibility that is necessary in certain situations. And, they add, fixed-price contracts can eventually cost the government more because contractors are likely to base their bids on the upper end of their expected costs. Other contract types, such as cost-plus, allow agencies to pay less if the final cost to the contractor is closer to the lower end of the range.

Many see fixed-price contracts as “the panacea for waste, fraud and abuse,” said Ellen Brown, former legislative director for the Republican staff of the House Oversight and Government Reform Committee. “Those of us who understand government procurement…know it’s not true.”

Avoid risk

In their fiscal 2010 budget proposal, titled “A New Era of Responsibility,” Obama administration officials wrote that cost-type contracts -- any of several kinds that start with the actual cost as a base and adjust the final price to include such things as a profit margin or an incentive for superior work -- are particularly vulnerable to exploitation. Such contracts offer no incentive for companies to control costs, they wrote, adding that those contracts increased 75 percent under President George W. Bush.

Furthermore, many lawmakers have said they believe contractors often take advantage of the government, especially when agencies enter into agreements in which prices aren’t set from the beginning.

The Obama administration said the stimulus package seeks to halt such abuses. Office of Management and Budget officials said agencies should ensure reasonable contractor risk and economic performance when selecting the contract type for a project that will use stimulus money.

“Fixed-price contracts provide maximum incentive for the contractor to control costs and perform effectively and impose a minimum burden upon the contracting parties,” OMB Director Peter Orszag wrote in a memo issued Feb. 18. “These contracts expose the government to the least risk.”

When an agency proposes using a riskier type of contract, it must first make certain it has evaluated all alternatives, Orszag wrote. If the agency doesn’t choose the fixed-price approach, officials must appoint an appropriate number of qualified acquisition employees to oversee the contract.

In his address to Congress Feb. 24, Obama said Cabinet secretaries — just like the mayors and governors who will receive stimulus money — are accountable to him and to the American people for the money they spend.

“Here in Washington, we’ve all seen how quickly good intentions can turn into broken promises and wasteful spending,” Obama said. The administration plans to track stimulus spending at a Web site called Recovery.gov.

Casting a dark shadow

Recovery.gov features another measure that more subtly nudges agencies to choose fixed-price contracts: Other kinds of contracts and sole-source awards must be posted in a special section of Recovery.gov.

“A summary of any contract awarded with such funds that is not fixed-price and not awarded using competitive procedures shall be posted in a special section of the Web site,” the legislation states.

Stan Soloway, president and chief executive officer of the Professional Services Council, an industry trade group, said that approach puts contracting officers under pressure to keep their work out of the spotlight. Posting the information in a separate section could cast a dark shadow over the contract by implying there’s something unsuitable about it, even when it might be the best kind of contract for that procurement, Soloway said.

Contracting officers prefer to do their work in quiet obscurity, but they can face significant repercussions for making bad acquisition choices. “They already feel like they’re on the front lines,” Soloway said.

One contracting officer, who spoke on condition of anonymity because he is not authorized to discuss legislation, criticized the micromanaging nature of the provision. “When are they going to stop telling me how to do my job?” he asked.

The officer said he and his fellow professionals understand the procurement process better than members of Congress do. Although lawmakers act like they know the process as well as the people in the field do, he said, they fail to recognize that contracting officers need many options for finding the best fit for agencies seeking a contractor’s services.

Learn from the past

In an era in which development proceeds rapidly in areas such as back-office information technology systems and military combat systems, contracting lessons from a decade ago can offer insight.

Computer software development expanded rapidly in the 1990s. However, it was still new, and agencies struggled to write clear definitions when buying new software that would work with old systems. At the time, the government used fixed-price contracts to buy software, Brown said. With the companies taking on the risk, the government paid a lot more for the software.

“Fixed-price contracts are completely appropriate when we know what we’re going to buy,” said Paul Kaminski, chairman of a National Research Council study on systems engineering for the Defense Department and undersecretary of Defense for acquisition and technology from 1994 to 1997. If there’s uncertainty, “I think we end up on the wrong end of the bargain negotiating a fixed-price contract.”

Experts agree that returning to the era of fixed-price contracts won’t protect the government from ballooning costs and could even lead to overpriced contracts.

Sen. Joe Lieberman (I-Conn.), chairman of the Homeland Security and Governmental Affairs Committee, said fixed-price contracts aren’t a simple solution to saving money, but they do work in certain circumstances.

“No acquisition of any kind, however diligent, can overcome a fatally flawed statement of work,” said Elliott Branch, executive director of contracts at the Naval Sea Systems Command.

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Obama wants contracting overhaul

2009-03-06T22:16:00.009-05:00

The way government agencies acquire the goods and services needed to carry out their responsibilities will take an abrupt 180-degree turn if President Barack Obama gets his way.

Obama made it clear last week that he wants to abandon the Bush administration’s drive to push more federal work into the private sector and, at the same time, toughen on contracts that he considers prone to exploitation by companies and wasteful to agencies.

“It’s time for this waste and inefficiency to end. It’s time for a government that only invests in what works,” Obama said in a news conference March 4. The same day, Obama signed a presidential memo putting the overhaul into motion.

The president’s push to have agencies interact differently with contractors is a sea change from the Bush era. Departments have become overly reliant on contractors, Obama's memo states. As a result, government spending through contracts has more than doubled since 2001, reaching more than $500 billion in 2008.

Obama would put more obstacles in front of contractors who might want to cheat the government with substandard work. And he plans to “in-source” federal work, a process of identifying outsourced work and bringing it back into agencies.

Furthermore, he’s moving away from cost-reimbursement and no-bid contracts by demanding that agencies use fixed-price contracts as much as possible.

The unexpected scope and sweep of Obama’s directive took Washington’s procurement community by surprise and prompted a wave of criticism from outside contractors and acquisition officials inside the government. Obama’s campaign rhetoric against procurement abuse might play well with the mainstream press and the general public, they say, but he’s missing some of the most crucial problems that plague federal procurement.

Critics say Obama’s proposals would do little to stem an explosion in the use of of task and delivery orders rather than full contracts. And it does not seem to offer any relief to an already stressed acquisition workforce.

“In an area as technical as procurement, it is not a good idea simply to translate campaign rhetoric into the nuts-and-bolts of government management,” said Steve Kelman, administrator of the Office of Federal Procurement Policy from 1993 to 1997 and now a Harvard University professor, on his FCW.com blog, "The Lectern."

A major point of contention is the administration’s negative view of no-bid and cost reimbursement contracts. Although Obama’s memo cites the increase in those contract types, he misses the larger picture, Kelman said, which is all contracting has increased significantly in that span of time. According to an OFPP memo from 2008, the proportion of contracts that are fully competed has remained steady at more than 60 percent from 2003 to 2007.

“It is a higher priority to seek to increase [the] use of performance and cost incentives in cost-reimbursement [or time-and-materials] work than to attack cost-reimbursement contracting per se across the board,” Kelman wrote.

Obama said the Office of Management and Budget will issue governmentwide guidance by Sept. 30 on the appropriate use and oversight of sole-source and other types of noncompetitive contracts. He said the amount of money funneled through those types of contracts jumped from $71 billion in 2000 to $135 billion in 2008, which is a 47 percent increase. He instead wants to see more full-and-open competition for contracts.

Furthermore, OMB will develop more detailed guidance by July 1 to help agencies review their existing contracts to find the wasteful ones that are unlikely to meet their needs, the memo states.

“We will end unnecessary no-bid contracts and cost-plus contracts that run up the bill that is paid by the American people,” Obama said. He predicted his reforms would save the government $40 billion each year.

While those reforms might save money, experts said more dramatic savings could come from a well-educated and better-trained acquisition workforce. Obama needs to make training the workforce the paramount priority, not simply curtailing certain types of contracts, they say.

“That’s got to be the central theme,” said Robert Burton, former deputy Office of Federal Procurement Policy administrator from 2001 to 2008 and now partner at Venable law firm.

Many acquisition employees don’t fully understand the 1,949 pages of the Federal Acquisition Regulation and their agencies’ own regulatory supplements, Burton said. Training them to improve their understanding of and adherence to the laws could solve many contracting programs, he said.

Meanwhile, task and delivery orders are increasing with little guidance, Burton said. Today, more than 50 percent of the federal contracting expenditures go through huge task and delivery orders. Core problems exist with these orders, such as poorly defined requirements that are often out of scope of the contract, and limited competition for work. It’s an area that needs more guidance, he said.

Similarly, a panel of former Defense Department acquisition officials told senators last week that knowledgeable and experienced acquisition employees are the solution to improving programs and controlling costs.

Fixed-price contracts have a role in federal contracting, but contracting officers need a wider range of options, several government acquisition executives said. Officials should not discourage the acquisition community from using other appropriate contracts that might suit specific needs.

Still, experts say departments’ contracting officers must support the White House’s changes if agencies expect better contracting decisions and savings. Michael Sullivan, director of acquisition and sourcing management at the Government Accountability Office, said memos and legislation might not achieve the goals unless departments transform the overall acquisition culture.

Ray Bjorklund, a military officer and Defense Department acquisition official from 1971 to 1998 and now senior vice president and chief knowledge officer at FedSources, said Obama is aggressively pushing agencies to choose the right type of contracts.

Angela Styles, OFPP administrator from 2001 to 2003 and now partner at Crowell and Moring’s Government Contracts Group, said Obama might have hampered his efforts by over-generalizing the motives of contractors. The president will need good contractors to drive the initiative forward, cooperation that he might be less likely to get if they feel offended that he appeared to characterize all contractors as mercenary and untrustworthy.

“If you make one false turn as a contractor, you will be brought to your knees by the full power of the U.S. government," Styles said. "It is not a great place to be. The vast majority of government contractors understand that what they do is for the taxpayer and to make the federal government work better.”

Bringing the work home

Obama said he wants to limit the outsourcing of federal work, whereas the Bush administration sought to increase it. The question, as always, turns on the definition of inherently governmental work, which is work that only federal employees can properly do.

The fiscal 2009 Omnibus Appropriations Act already passed by the House would require a clarification of those functions. The Senate had not passed the bill as of March 6, but Obama has made limiting outsourcing a priority to pursue regardless of the bill's fate. The legislation would make it easier for agencies to pull work back into the agencies and away from contractors.

And so it appears that Obama, with the vocal support of Democrats in Congress in addition to Republicans such as Sen. John McCain of Arizona, is fundamentally changing the relationship between the public and private sectors. And it would also appear that the tide is in his favor. Several members of Congress made statements of support for Obama, and many of his proposed reforms are already incorporated in the current Defense Authorization Act, which President Bush signed last year.

“We must put an end to no-bid contracts and dishonorable procurement practices that are often the root cause of waste, fraud and abuse of taxpayer dollars,” said Rep. Edolphus Towns, (D-N.Y.), chairman of the House Oversight and Government Reform Committee.

Read the story: FCW.com News - Obama wants contracting overhaul

Obama: Big changes coming in federal contracting

2009-03-04T19:00:00.005-05:00

President Barack Obama said he wants an overhaul of government contracting and signed a presidential memorandum to launch the effort today.

“It’s time for this waste and inefficiency to end,” he said at a news conference. “It’s time for a government that only invests in what works.” (Read a transcript of his comments.)

Obama said the Office of Management and Budget will issue governmentwide guidance by Sept. 30 on the appropriate use and oversight of sole-source and other types of noncompetitive contracts. But he added that he wants to see more full and open competition for contracts.

By July 1, OMB will develop more detailed guidance to help agencies review their existing contracts to identify wasteful ones that are unlikely to meet their needs, the memo states.

Obama said he wants agencies to better oversee all types of contracts and carefully consider the agencies’ needs before signing any deal. The changes would minimize the risks for government and boost the value of contracts, he said.

“We will end unnecessary no-bid contracts and cost-plus contracts that run up the bill that is paid by the American people,” he said. The reforms would save the government $40 billion each year, he added.

Obama also wants to clarify when it’s appropriate to outsource federal work and help agencies find the appropriate size and experience for the federal employees who develop and oversee acquisitions.

Obama focused largely on defense contracting but said the reforms will span all agencies. He cited a 2008 Government Accountability Office study of 95 Defense Department weapon programs that found cost overruns of $295 billion and average delays of 21 months.

“I can assure you that this will be a priority for my administration," Obama said. "It’s time to end the extra costs and long delays that are all too common in our defense contracting.”

Obama said he wants agencies to enter into contracts that will bring value, adding that agencies have wasted money through poor planning while giving contractors ample opportunities to take advantage of the government.

“It is essential that the federal government have the capacity to carry out robust and thorough management and oversight of its contracts,” the memo states.

Read the story: FCW.com News - Obama: Big changes coming in federal contracting

Woman-owned IT firms seek inclusion

2009-03-02T10:50:00.009-05:00

As the Small Business Administration considers which industries can receive set-asides, women business owners hope they won't be overlooked

Katie Sleep is training for the Ironman Triathlon in part to handle the stress of her job as chief executive officer of List Innovative Solutions Inc., a small technology company in Herndon, Va.

“The training has saved my life,” Sleep said. “If you carry that stress every day, you’ve got to get rid of it somehow.”

As part of a seven-day workout routine, Sleep runs on the Washington and Old Dominion Trail at 6:30 a.m. on Mondays and Wednesdays. She swims Tuesdays and Thursdays at 5:45 a.m., and she exercises again in the evenings and on weekends.

“Working out has given me the energy to save this company,” Sleep said.

Women who own small information technology firms, like Sleep, are under a lot of pressure to protect their companies during the current recession. Meanwhile, they are losing out on government business that could help them because there is no program that sets aside contracts for woman-owned small companies.

According to the Small Business Administration, women are underrepresented in some fields, but there are too many woman-owned businesses in the technology industry to warrant set-aside contracts.

In general, the IT field doesn’t have more woman-owned businesses competing for work than other industries, at least not on a per-dollar-spent basis, said Kevin Plexico, senior vice president of operations at Input, a market research firm. The IT industry tends to fall in the middle relative to other major industries. Some segments, such as professional services, tend to have a larger number of woman-owned businesses, but the average contract size tends to be smaller and therefore they attract small firms, he added.

SBA’s Dynamic Small Business Search directory lists 69,000 woman-owned firms. Of those, about 2,800 received prime contracts in fiscal 2008 for IT-related products and services. About 7,700 woman-owned small businesses span several types of technology-related sectors — from data processing to computer system design and computer sales — and they earned nearly $45.8 million in federal contracting in 2008, according to FedMine, a data research firm.

Persistence will pay

But women who own technology companies are not counting themselves out of getting a set-aside program.

“One thing about women is they don’t give up,” Sleep said.

In October 2008, SBA proposed expanding the set-aside program from four obscure industries, which include kitchen-cabinet making, to 31. However, IT was not included on the proposed new list. A women's advocacy organization said SBA is missing the bigger picture.

“The 30-plus [list] currently being considered still does not accurately portray what we believe to be the real situation — namely, that women in most industry sectors are underrepresented” among federal contractors, the Women’s Business Enterprise National Council wrote in November 2008 in response to SBA’s proposed rule.

Women who own small businesses battle for contracts against large incumbent companies that have strong ties to the government. They don’t have as many resources to compete for the work, especially when agencies bundle smaller projects into one large contract. Women also often stand on the outside of an exclusive club of insider companies, several women business owners said.

“Quite frankly, there are no benefits to being a woman-owned small business,” said Alison Brown, president and CEO of Navsys Corp., a Global Positioning System software engineering company in Colorado Springs, Colo. For example, women face serious barriers when they try to break into the defense contracting market, she said. Set-asides would help small businesses, but “I don’t mean to say it’s easy if you have a level playing field,” she added.

Obama raises hope

Many women are hopeful that the new president will bring change. During his campaign, then-Sen. Barack Obama said he wanted to boost contracting opportunities for women and would push to establish a contracting program for woman-owned businesses. In the past few years, Congress has sought to help women by creating such a program, but officials have yet to fully launch it.

Despite years of ignoring the issue and concerns about constitutionality, officials have tried in the past two years to create a framework of regulations for the program, but a recent regulatory proposal crushed any progress by upsetting some members of Congress and small-business advocates. Some lawmakers objected to SBA’s proposed rule that would have opened the set-aside program to only a select few industries. Senators were ready to block the regulation with a single provision in an appropriations bill.

A rule finalized Oct. 1, 2008, authorized contracting officers to restrict competition to eligible woman-owned small businesses for contracts worth less than $3 million in industries in which women were underrepresented. However, any agency seeking the set-aside must show SBA that the arrangement would meet constitutional requirements.

SBA wants better data

Under that rule, SBA must determine in which industries women are underrepresented. Officials are seeking input on what source of information would offer the clearest picture of women in business.

SBA officials are accepting comments until March 13 on whether the agency should use the Central Contractor Registration or the Census Bureau’s Survey of Business Owners. The survey includes information about demographics, type of business and gross receipts. Several experts say CCR and the survey are the only reliable sources with disparity ratio information.

But many business owners don’t approve of using CCR to determine the number of woman-owned small businesses that are ready to handle government contracts. They note that many companies don’t enter their names in the registry until they require payment for contracted work. And many of them are subcontractors that are not paid directly by the government.

“From personal knowledge, the CCR as indicative of truly woman-owned companies is some kind of stupid joke,” wrote an anonymous woman business owner in a comment to SBA about its proposal. The writer said CCR’s data is suspect because companies enter the information themselves. “Bad data is worse than no data,” she said.

However, SBA officials say the Census survey might overestimate the number of companies that are ready for set-aside contracts.

“The glass ceiling is still there,” Sleep said. “The question is how are you going to be creative and get around it.”

Alba Alemán, president of Citizant Inc., a company based in Chantilly, Va., that specializes in enterprise architecture, said women aren’t respected as federal contractors. Nevertheless, she has noticed more women in business these days, increasing the importance of having a set-aside program for IT companies.

“Set-asides support an emerging market,” she said.

Women business owners say they intend to continue fighting for set-asides, even if they only succeed in helping the next generation of entrepreneurs. As Sleep put it, “You always want to make it better for the people who are coming behind you.”

Read the story: Washingtontechnology.com - Woman-owned IT firms seek inclusion

Winners and one possible loser

2009-01-13T20:04:00.007-05:00

Small businesses owned by veterans and women could be winners under the Obama administration.

But with a new Congress, Alaska Native Corporations (ANCs) are looking for a key ally and could see some of their advantages diminish.

During Barack Obama’s presidential campaign, the Democratic candidate said he would strengthen federal small-business programs that focus on women, service-disabled veterans and minority business-owners. He wants to offer them more contracting opportunities with the government to help them grow. To help with that, Obama said he would restore SBA’s budget and strengthen its clout in the government. Karen Mills, a principal in the private equity and venture capital industry since 1983, was nominated as SBA’s administrator.

In particular, the president-elect wants to boost opportunities for women business-owners. He said he would stand up the women-owned business contracting program. Despite years of neglect, SBA officials made efforts in the last two years to launch the program, but a recent regulatory proposal crushed any progress by upsetting some members of Congress and small-business advocates. SBA’s rule would have opened the set-aside program to a select few industries. Lawmakers vehemently objected to the rule and were ready to block it statutorily in an appropriations bill. SBA hasn’t implemented the rule.

Small-business observers also expect veterans to benefit more than some other set-aside groups. Warfighters returning from Iraq and Afghanistan will get a lot of attention from the government under Obama. Guy Timberlake, chief visionary and chief executive officer at the American Small Business Coalition, said the support for veterans could lead to the creation of a program on par with companies owned by ANCs.

Timberlake and others in the small-business community said ANCs are a small segment of government contractors yet they have a large advantage over other small businesses. But ANCs are losing a key ally on Capitol Hill as Sen. Ted Stevens (R-Alaska) didn’t return to the Senate this year after being defeated in his re-election bid.

Whatever the set-aside category, many small businesses teeter on the verge of collapse when the economy falters. Thom Rubel, practice director of government programs at Government Insights, said the government must develop ways to incubate businesses to help them grow. If it can do that, the government can expect some valuable savings. But he said it takes more than simply awarding a percentage of contract dollars to help small businesses.

Timberlake said small businesses can offer government much more than in the past because they are more sophisticated today. That leads to greater capacity to handle more work on large, complex contracts, which in the past were geared for large companies.

But some small-business executives are still skeptical about Obama’s promises.

“It’s an easy thing to say, ‘We support small businesses,’ ” said Daniel Carr, chief executive officer of Distributed Solutions. Small-business owners have listened to the importance of small businesses while federal dollars have gone elsewhere.

However, Carr added, “it’s in our nature to be optimistic. The entrepreneurial hat worn by small businesses requires that we see opportunity and hope around every corner.”

So, Carr is waiting to see what comes from Obama.

Read the story: Washington Technology News - Winners and one possible loser

IG: Job competition saps staff

2009-01-12T20:26:00.016-05:00

DOD auditor’s report sends clear signal on what the acquisition workforce needs

A team of Defense Department auditors, through a series of surveys at military bases, has determined several foundational acquisition workforce issues that experts say must be priorities for President-elect Barack Obama’s administration.

Officials told auditors from the DOD Inspector General’s Office that competitive sourcing — a process intended to improve efficiency by having federal employees contend with private sector firms for work — saps their employees’ attention from their jobs and leaves offices with insufficient contracting support.

Because competition pulls employees from their regular duties to rigorously gather and analyze data, managers are reluctant to take part in the process. Advocates of competitive sourcing argue that government organizations usually win the competitions and become more efficient in the process.

When the private sector wins, agencies usually lose their experienced workers, according to the IG report released Jan. 5.

More importantly, an Army Contracting Agency official told auditors that the agency faces constant turnover of contracting officers during competitions. Agency leaders worry about getting and keeping competent contracting officers — especially as purchases become more complex — but the practice intended to compel efficiency can drive away talented ones.

OMB’s influence

The IG auditors conducted the review at the request of members of Congress who want to ensure that the Office of Management and Budget has not been influencing DOD’s decisions on whether to conduct a public/private competition. The competitions are possible only for jobs that are not inherently governmental function, which only federal employees can do.

Military officers and the officials in charge of overseeing the competitions told the auditors they felt no pressure from OMB, according to the DOD IG report titled “Office of Management and Budget Influence Over DOD Public-Private Competitions.” The fiscal 2008 National Defense Authorization Act required the report.

The auditors concluded that early in 2008, the Office of the Secretary of Defense (OSD) had put pressure on the Army to conduct the competitions, but the pressure waned by the end of the year. Meanwhile, officials at the Army Materiel Command and Army Installation Management Command said the chain of command pushed them more than OSD or OMB did, according to the report. The two major commands announced their competitions because of pressure to reach a goal that the Army already set.

Wayne Arny, deputy undersecretary of Defense for installations and environment, told the auditors that DOD independently determines its competitive sourcing program.

During the normal program and budget review process, the service branches create plans for public/private competitions.

The defense agencies are expected to carry out those plans, he said.

Arny added that competitive sourcing is an important management tool, and he encourages agencies to continue to use it as much as possible.

“Competitive sourcing consistently results in greater government efficiency and cost-savings to the taxpayer,” he wrote in a March 2008 memo. DOD saved more than $7 billion from competitions completed between fiscal 2000 and 2007, Arny said. The number could top $10 billion after the competitions started in 2008 are finished, he wrote.

A controversial initiative

Competitive sourcing is the second initiative on the Bush administration’s President’s Management Agenda. Administration officials believe the competitions decrease costs and trim a department’s operations.

Setting up the competitions can determine if it’s better to keep the work with federal employees or outsource it to contractors, officials say.

In the last Executive Branch Management Scorecard issued by OMB, released last week, only the Smithsonian Institution improved. Twenty-two of the 24 graded agencies received the top score or an average grade. The Energy Department and National Science Foundation again earned the lowest rating.

The sourcing initiative has never had widespread support: Congress steadily imposes limits on it. Army and Air Force officials said the congressional restrictions on competitive sourcing change every year, making it difficult to keep up with the laws and regulations while in the process of hosting the competition, according to the IG’s report.

Numerous laws have restricted the use of competitive sourcing, effectively stopping the practice. The fiscal 2008 National Defense Authorization Act restricted OMB and the defense secretary from influencing DOD regarding competitive sourcing, and it also required the IG review.

The competitive sourcing initiative is now called commercial services management and includes business process re-engineering along with the competitions.

Some experts have questioned whether the initiative would survive during the Obama administration, but the president-elect is looking for areas where he can cut costs and save money.

“Change and reform can’t just be election-year slogans,” Obama said. “They must become fundamental principles of government.”

Challenges for Obama

Competitive sourcing is only one issue that awaits Obama’s pick for the administrator of the Office of Federal Procurement Policy, experts say.

“The need for an acquisition workforce that can navigate the government’s contracting process, translate it for government buyers and private-sector contractors, and ensure the taxpayers get what they pay for has never been greater,” said Diane Denholm, a principal at Grant Thornton.

She recommended that the new administrator work with agencies to find ways to fill gaps with available resources. The administrator also should work with chief acquisition officers to learn what skills employees need, then maintain those skills with regular training.

A survey conducted by the Professional Services Council and Grant Thornton, which was released in December, showed the acquisition workforce’s continued concerns about recruiting, training and retaining the right people.

Stan Soloway, the council’s president, said the survey provided no surprises or raised new issues but showed lingering concerns that need a resolution.

The council and Grant Thornton said the Obama administration should view its procurement policy initiatives through the lens of strategic human capital planning.

“The future workforce needs to have the capability to provide innovative risk-based approaches to assist the agencies [as they] acquire products and services in a way that maximizes performance and minimizes costs,” said Denholm, who was involved in analyzing the survey’s results.

The need for a larger, better trained workforce is obvious, said Trey Hodgkins, vice president of federal government programs for the Information Technology Association of America.

“It’s a broader set of skills that we need to attract and retain,” he said. However, the broken hiring system is a major hindrance to bringing people in.

The system is another challenge awaiting the OFPP administrator, who will have to work with other agency officials to solve that problem.

A simple request

Many people in government acquisition consider success to be hiring the right people and training them well. Denholm said the survey respondents described success in terms of day-to-day operations rather than the rare award of a major contract.

According to many respondents, the workforce might be unprepared for the changing environment.

Acquisition is becoming more complex, and the volume of procurements has put new demands on contracting officers. Several interviewees stressed the need for better training in areas of business, analytical and management skills, the survey states.

“The current acquisition workforce doesn’t have sophisticated business judgment,” an oversight official said in the survey. “They are good at following the rules, but when the rules lead you to an illogical conclusion, you need judgment. Acquisition is more of an art than a science."

Read the story: FCW.com News - IG: Job competition saps staff

Experts: Value beats price to avoid fake IT

2008-12-12T17:25:00.005-05:00

As government regulators consider tougher ways to block counterfeit information technology products from entering the federal marketplace, they’re restarting an old debate about whether to award contracts based on the lowest bid or the best value.

At a meeting Dec. 11 regarding newly proposed rules on counterfeit IT, Laura Auletta, a procurement policy analyst at the Office of Federal Procurement Policy, said she was surprised to hear that contracting officers believe they should award a contract to the lowest bidder to save money instead of finding the best value.

Contracting officers and acquisition officials often interpret the Federal Acquisition Regulation to mean that the lowest bid should get the award, said James Bockman, a former NASA official who worked closely with the agency’s procurement employees.

“They see that as saving the government money,” said Bockman, who is now a special projects engineer at Aerospace Corp.

The FAR gives civilian agencies broad discretion in making decisions based on price or other best-value parameters, such as the company’s experience and management capabilities. But government and industry experts say acquisition workers are concerned about making a mistake and paying for it with a career-ending embarrassment. With today’s emphasis on curbing waste and abuse, they say contracting officers often choose the vendor with the lowest price.

However, federal officials agree that the government should strive for quality and ensure that agencies don’t buy products that are tainted with malware or poorly made.

The prevalence of counterfeit IT and electronic parts has exploded in the past five years after roughly 20 years of level numbers, officials say.

“The whole supply chain is infected with counterfeit parts,” said Brian Hughitt, manager of quality assurance at NASA’s Safety and Assurance Requirements Division.

The sudden increase has led regulators to add tougher checks to the FAR. Counterfeit IT products lead to financial losses for government agencies and companies, and they pose a threat to national security, the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council wrote in a Nov. 18 Federal Register notice.

The new rules’ draft language would require agencies to buy all IT products from original equipment manufacturers, software developers, or authorized distributors or resellers. In addition, agencies would have to require companies to offer proof in contract proposals that their products are authentic.

Edward Chambers, a procurement analyst at the General Services Administration who is leading the regulatory proposal, tried to allay initial concerns from industry and government officials by saying the language is preliminary.

At the meeting, government officials disagreed about who’s to blame if an agency buys fake IT or electronic parts. Hughitt said a federal employee should take no blame if an agency buys a phony product because the contractor should know what it’s selling to the government.

However, the government does not use rigorous scrutiny when evaluating products, said Brad Botwin, director of industrial studies at the Commerce Department.

“The sloppiest processes are on this side of the house,” he said, referring to the government, particularly the Defense Logistics Agency. The liability for counterfeit parts rests on contractors and the government.

As the debate continues, officials say they need to find a way to increase scrutiny without putting companies out of business. But the checks are necessary because counterfeit products will continue to be a problem, Botwin said.

Read the story: FCW.com News - Experts: Value beats price to avoid fake IT

Watchdogs make industry leery

2008-12-10T05:01:00.003-05:00

Federal contractors must report evidence of crimes to inspectors general under new requirements

Contracting officers and government contractors will soon have someone new in their relationship: a watchdog.

Starting Dec. 12, contractors will be required to tell government officials if they find evidence of criminal activities related to a federal contract or if the government overpays them. The new rules allow federal officials to suspend or even debar a company from government work if the company knowingly fails to inform officials.

Experts say contractors are most concerned about the requirement that they inform two parties: the appropriate contracting officer and the agency’s inspector general.

Most contractors’ mistakes, including accidental overpayments, are minor administrative errors that contracting officers can easily fix, government and industry experts say. But because IGs have different responsibilities from contracting officers, the mandate makes contractors anxious about sharing even minor infractions with IGs.

“The rule goes too far,” said David Drabkin, deputy chief acquisition officer at the General Services Administration, adding that it won’t help relationships among contractors, agencies and IGs.

However, regulators say they wrote the rules with contractors in mind. They offer flexibility and allow companies to find credible evidence of a crime before reporting it. For agencies, reporting requirements will encourage relationships between IGs and contracting officers as they work together to root out fraud, regulators say.

The rules will have “contractors turning square corners and everybody walking with that halo over their head,” said Ernest Woodson, a procurement analyst at GSA who was instrumental in writing the regulations.

The sea change
The revision to the Federal Acquisition Regulation stands as a reversal from long-standing policies of voluntary disclosure.

“There is no doubt that mandatory disclosure is a sea change and major departure,” the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council wrote in a Federal Register notice outlining the rule.

But the councils said contractors have largely ignored voluntary disclosure policies for the past decade, as the Justice Department and the National Procurement Fraud Task Force have also charged. In May 2007, the department and task force proposed the FAR changes to Robert Burton, then deputy administrator of the Office of Federal Procurement Policy and now a partner at the Venable law firm.

“We believe that if the FAR were more explicit in requiring such notification, it would serve to emphasize the critical importance of integrity in contracting,” they wrote. The new mandates stemmed from that letter.

Burton said the rules will encourage contractors to institute vigorous processes for reporting internal criminal allegations and quickly reviewing the merits of those claims.

“The rule will add weight to the arguments inside a corporation that good business practices in the long run favor compliance and disclosure,” the councils wrote.

Lesley Field, acting OFPP administrator, said mandatory reporting is a sound business ethic and should already be part of companies’ standards.

Contractors might be more comfortable leaving the IG out of the process, but regulators say disclosing a crime to the contracting officer isn’t enough because he or she is in no position to evaluate criminal actions.

“Contracting officers truly wouldn’t know what to do,” Woodson said. “We don’t want the contracting officer interfering with an investigation that the IG or the Department of Justice may have to get involved with.”

Essentially, regulators want those crimes referred immediately to people with badges.

In a speech in November, James Graham, a trial lawyer in the Justice's Criminal Division, said the proposal should improve procurement oversight when mistakes or criminal activities happen. Graham later told reporters that notifying the IG would make the contracting officer and IG work more closely together.

Graham, who also helped craft the regulations, said that although most contractors are honest, fraud is always possible, and the tendency toward corruption is constant.

“It’s the human condition,” he said.

Altering relationships
In public comments on the rule, many people disagreed with the mandate. One wrote that in 1986 a proposal from the Defense Department to make fraud disclosures mandatory foundered. In 1989, then-Defense Secretary Dick Cheney withdrew a proposed mandatory reporting rule on the grounds that “to be meaningful, corporate codes of conduct must be adopted by contractors voluntarily, not mandated in procurement regulations.”

Similarly, Elliott Branch, executive director of contracts at the Naval Sea Systems Command, said there must be a cultural shift in contractors’ thinking or the rules could be meaningless.

Many observers also say the new rules would likely keep the parties at a distance so they can avoid the appearance of wrongdoing.

“It could have a chilling effect on relationships between the contracting officer and the contractor,” Burton said.

Contracting officers and IGs view contractors through different lenses, said Michael Mason, a partner at the Hogan and Hartson law firm. For instance, contracting officers see companies as business partners that are trying to accomplish a contractual job for the agency. But IGs are the government’s watchdogs. They’re trained to sniff out fraud, waste and abuse and expose it. Experts say that focus will strain government/industry relations.

In public comments to the Federal Register, some industry representatives said reporting activities to the IG would take the ability to settle and resolve issues away from the contracting officer and agency. It undercuts the contracting officer’s right to handle a contract, they argued.

Furthermore, IGs have limited resources and staff, and disclosures will slow the procurement process, some commenters said.

Flexibilities
Regulators say they realized that the rules would place more burdens on contractors. Therefore, they granted contractors flexibilities within the rules in an attempt to strike a balance.

“We want disclosure,” said a Bush administration official who requested anonymity. “On the other hand, we want to show some semblance of fairness where there’s uncertainty.”

When learning of an alleged crime, contractors can investigate the credibility of the allegation before telling the government, the official said, adding that “rumors are not enough to trigger the disclosure requirement.”

Until the contractor has determined the allegation’s credibility, federal officials can’t charge the contractor with knowingly failing to inform government officials. Regulators also declined to set specific timelines, saying they would be arbitrary and cause more problems than they would solve.

Despite regulators’ efforts to ease the burden on contractors, the industry remains unenthusiastic, said Richard Bednar, senior counsel at the Washington office of law firm Crowell and Moring and coordinator of the Defense Industry Initiative on Business Ethics and Conduct. In the end, contractors might focus on the rule’s loopholes and report fewer incidents.

But Bednar said the councils clarified many of the uncertainties when they published the final version of the proposed rule. Contractors can respond to the rules by “pulling up their socks and being responsible contractors,” he said.

"I do think it’s digestible,” he added.

Read the story: FCW.com News - Watchdogs make industry leery

Ruling buttresses small businesses

2008-12-08T05:01:00.008-05:00

Yet favorable 'Rule of Two' decision could come at a high cost

Ed Driscoll, president and chief executive officer of Delex Systems Inc., was forced into an awkward position last spring. His customer of 40 years, the Navy, was disregarding small-business acquisition rules. Delex risked losing a lot of potential business if the problem continued.

On a $75 million contract, the Navy decided against setting aside orders for small businesses as acquisition rules require when at least two small companies can handle the work and can offer reasonable prices.

Driscoll, a former Navy officer, had invested millions of dollars just to earn a spot to compete for the orders on the Navy’s Training Systems Contract II. Given the size of his investment and the contract, he had to consider a protest. At the same time, he did not want to wreck a relationship he had spent years building.

Ultimately, he had no choice. “This was an opportunities issue and an investment issue,” he said.

After hearing Delex’s case, the Government Accountability Office decided Oct. 8 that agencies must set aside some task orders if at least two small businesses could do the work, which is known as the “rule of two.” The Federal Acquisition Regulation requires a contracting officer to reserve any order of more than $100,000 if at least two responsible small businesses could enter bids. The regulation was the foundation for GAO’s ruling.

Driscoll won the protest, and the result might give small businesses such as Delex a new edge in government contracting. By ruling that agencies must set aside work for small businesses if they find two such companies that are capable of meeting the agencies’ needs, the GAO buttressed rules that agencies have often disregarded.

However, the decision could stress relationships between companies and agencies. Agency officials expect more time-consuming protests for not setting aside work. And they’re frustrated by the prospect.

“Delex hints at some of the angst people haven’t had since” acquisition reforms in the 1990s, said Ray Bjorklund, senior vice president and chief knowledge officer at FedSources Inc., a market research firm.

When they solicited the task order under the training contract, Navy officials decided not to set it aside for small businesses. Instead, they opened the competition to large and small companies on the multiple-award contract.

“GAO tipped the playing field in favor of small-business contract-holders,” said Alan Chvotkin, executive vice president and counsel at the Professional Services Council, an industry group. GAO has significantly changed how agencies and contractors plan their acquisition strategies, especially when it comes to multiple-award contracts that have a mixture of small and large companies, he added.

As a result of the decision, program managers and contracting officers will likely give more weight to small-business set-asides in their initial acquisition strategies, Bjorklund said. When agency officials need to buy something quickly, the greater possibility of a protest by a small company on a task or delivery order would make them keep set-asides in mind.

“Small businesses should capitalize on this opportunity,” said Andy McCann, vice president and geographic sales leader at EDS Corp.’s U.S. Government and Public Sector business.

ASSESSING THE DECISION
At this point, though, many companies and industry observers are still trying to understand what effect the ruling will have. An executive at a major systems integrator who asked to remain anonymous said large companies aren’t enthusiastic about the ruling, but the outcome depends on how a contracting officer interprets GAO’s decision. Integrators are waiting to see how to set up bidding strategies and partner with small businesses, especially on mixed indefinitedelivery, indefinite-quantity contracts.

The ruling could cause small businesses to consider new ways of working with integrators to ensure that they offer the best services and win future government contracts, McCann said.

“This ruling creates an incentive for small businesses to strive to be selected on IDIQ contract vehicles or to team with a large integrator on an IDIQ contract,” McCann said. It might also encourage companies to put more emphasis on their mentor/protégé programs.

Nevertheless, other experts say GAO’s decision doesn’t give advantages to small companies.

“On the surface, this may seem to be a benefit to small businesses, but the price may be too high,” said Guy Timberlake, chief visionary and chief executive officer at the American Small Business Coalition.

Timberlake said he is concerned that the decision might strain the already tense relationship between agencies and small businesses.

Officials and experts agree that the ruling could increase the distrust between industry and government. Agencies might suspect contractors of planning protests and including those projected costs in their bids.

Karen Kopf, operations director at the General Services Administration’s Federal Systems Integration and Management Center, said she feared becoming bogged down in protests, especially now that companies can protest task and delivery orders and be heard by GAO.

Lee Harvey, the Army’s deputy program executive officer for enterprise information systems, said that a decade ago, fewer companies protested award decisions because they wanted good relationships with the government. But today’s larger orders encourage people to protest, he said, because companies have more at stake.

“Frustration sums up our feelings,” Harvey said about GAO’s decision and its likely effects.

KEEPING TABS ON ORDERS
The crux of the issue was the Navy’s contention that Delex’s protest was against a delivery order and not a contract, making it exempt from the rule of two. But changes by Congress opened the orders to protests. In January, lawmakers decided that task and delivery orders were growing so large and complex that they equaled traditional contracts. They decided orders needed more regulation because agencies have been using task-order contracts for more than 50 percent of their procurements, compared with 14 percent in 1990, experts said. In the 1990s, the government viewed task orders as distinct from contracts and put those orders outside GAO’s jurisdiction.

GAO will keep its new authority to review task-order protests for three years. Legislators plan to evaluate the effects before then and make any necessary changes.

In the meantime, the new authority is changing the acquisition field, and GAO’s ruling could further alter how agencies view orders and contracts.

“More of these multiple-award opportunities might be issued as full-and- open [competitions] with no setaside components, creating a more prohibitive competition environment for the average small business,” Timberlake said.

Agencies will reassess the advantages of multiple-award contracts because of GAO’s ruling, Bjorklund said. They might ask themselves why they should go through the hassle of awarding an IDIQ and then go through another competition for task orders.

However, some experts say GAO’s decision won’t affect multiple-award contracts that separate small and large businesses.

The ruling will have little effect on NASA’s Solutions for Enterprisewide Procurement, a governmentwide acquisition contract, said Joanne Woytek, NASA’s SEWP program manager.

SEWP is organized into four groups of multiple-award contracts. Two are exclusively for small businesses with one of the two set-asides for small companies owned by service-disabled veterans. The other two groups are primarily for large businesses, though a few small companies are in the group.

Woytek said the ruling might affect a few orders in those groups that lack set-asides, but the small businesses in those groups are generally winning orders when they submit a reasonable bid.

“We have always encouraged contracting officers to provide a small-business preference, and now it will be more targeted if two of the small companies in the open groups can and want to provide a reasonable quote,” she said.

Whether the ruling opens an advantage for small businesses, it has left the contracting community in limbo. Ultimately, though, the rules are nothing new, and GAO has simply reinforced them, Driscoll said.

Read the story: Washington Technology - Ruling buttresses small businesses

Field surveys landscape as chief

2008-11-25T05:01:00.000-05:00

Several years after an adventurous ski trip, Lesley Field still wonders which one of her friends led them to the Mer de Glace (“Sea of Ice”), a glacier in the French Alps at an altitude of nearly 8,000 feet, without a map or a guide.

“I don’t think I fully realized what we’d done until we got to the bottom,” said Field, who comes from a family of daring skiers. “But honestly, it was probably the best skiing experience I’ve ever had.”

The Sea of Ice is nearly 700 feet deep and more than 4 miles long. “It was wide open,” she said.

In her first interview since she took over as acting administrator at the Office of Federal Procurement Policy, Field used skiing metaphors to describe her role.

While skiing, “you can see the topography, you can see the people, you can see where you’re going,” she said. “You see very far out into the future.”

Field has recently had to refocus her long-range view of procurement policy. In mid-July, she was studying the acquisition workforce and strategic sourcing as one of several OFPP policy analysts. Little more than a month later, she was whisked to the top of the governmentwide policy office to replace Deputy Administrator Robert Burton, who retired in July. When Administrator Paul Denett left Sept. 2, Field was appointed to the acting role.

She had arrived at OFPP on assignment from the Transportation Department in 2000. Kenneth Oscar, the office’s acting administrator at the time, said Field arrived with enthusiasm and a desire to see the big picture.

To help frame that picture, Field has dealt with federal procurement from several angles. She began her career with a summer internship at the National Academy of Sciences, where she worked in its contracting and grants office. In 1990, she entered a yearlong internship at DOT. Her managers noticed the procurement experience on her résumé and guided her toward acquisition.

Listen to Field discuss the acquisition field as a career.

Field worked at DOT for 10 years, rising from a contract specialist to a contracting officer to a management analyst to a procurement policy analyst. She also took assignments at the Federal Aviation Administration and Coast Guard before landing at OFPP.

Field has worked in acquisition for 18 years. From the time she was an intern, she enjoyed seeing how acquisitions she was involved in led to real benefits for agencies, she said. DOT officials allowed her and other interns to see the results of their work, so after she worked on a contract for sign-language interpreters, she was able to watch those interpreters help people in need. She has long been an advocate for requiring agencies to buy information technology that is accessible for people with disabilities.

And while on detail at FAA, she visited an air traffic control center in Leesburg, Va., and listened to controllers and pilots talk as they guided aircraft from one sector to another.

“I don’t think I ever realized there’s a giant highway” in the sky, she said.

Through those experiences, she began to understand the connection between the papers she was signing as a contracting officer and the daily work of agencies, Field said.

“It made all the difference in the world in someone’s ability to do their job,” she said.

Based on her experiences in taking temporary assignments at other agencies, Field said she is convinced that such rotations are important to keeping the acquisition workforce engaged. People can grow tired of a job, and rotating employees among agencies can keep them motivated, she said.

“We are in a very good position to offer that where we can,” she said. “Retention becomes just as important as recruitment and development.”

Listen to Field discuss job rotations.

“She’s passionate about improving the acquisition workforce,” said Burton, who’s now a partner at the law firm Venable.

Because of her varied assignments, Field was able to develop in-depth knowledge of how departments run their operations and incorporate that knowledge into governmentwide policy.

“When I got here, I realized you can really take the operational experience and really start to discover why the policy role is so interesting,” she said.

OFPP’s long-range view of procurement requires its analysts to connect the dots between agencies, considering what each of them does and how. OFPP finds best practices wherever they might be and spreads the word about them throughout agencies.

“We have a very unique position here in the world,” she said.

OFPP also has to deal with competing interests and agendas, Burton said. The administrator has to interact effectively with numerous groups that have their own priorities, including Congress and industry advocacy organizations.

“The art of negotiation becomes essential in that position,” he said.

Field said she recognizes those difficulties and likens them to skiing, where some terrain is easier to cross than other stretches. But the skier must traverse it all to reach the destination.

Oscar and Burton agreed that Field has a way with people that will ultimately help her as OFPP’s acting and deputy administrator.

Oscar has seen Field’s ability to draw people with contradictory views and ideas into a unified group. “She was able to get things done,” he said.

She needs to use that ingenuity to her advantage, he added. To leave her mark on OFPP, she must push forward her agenda, goals and objectives, and not merely fill the position of acting administrator, Oscar said.

“She’s got to act like she’s ‘it,’ go as if she’s the administrator,” he said. Even in an acting capacity, Field could be in charge for as long as a year.

Burton agreed, saying Field must be aggressive in her leadership. He was OFPP’s acting administrator twice and said the office deals with nonpartisan issues, so having the political backing of the presidential administration is less important than it is for other agency leaders.

Read the story: FCW.com News - Field surveys landscape as chief

Making noise for small business

2008-11-24T05:01:00.001-05:00

Small-business advocates seek to change the government’s contracting culture from within

The Office of Small and Disadvantaged Business Utilization sounds more bureaucratic than practical — especially when referred to by its acronym OSDBU or “oz-duh-boo.”

Although the Defense Department has changed the name of its organization to the Office of Small Business Programs, the term OSDBU has stuck at many agencies. And if the offices’ directors have their way, the term will become increasingly familiar to their agencies’ program managers and contracting officers.

The goal is to change the way procurement leaders think about the role of small businesses. In one case, at least, that involves handing out statues of ducks.

“The OSDBUs are a very vocal group,” said Robert Burton, former deputy administrator of the Office of Federal Procurement Policy. That’s a necessary trait for them to fulfill their role of advocating for small businesses, he added.

Their challenge is to go beyond reminding people about contracting rules and regulations and instill new attitudes in an entrenched government culture.

Contracting officers typically understand regulations about small-business set-aside contracts and might be aware of contracting goals, said Teresa Lewis, director of the Treasury Department’s OSDBU. But program managers — who are central players in acquisitions — are accustomed to a certain way of working, she said.

The way they often see it, their existing contractors understand their needs and expectations, so they question why they should give that up for a small-business contract, Lewis said. But the OSDBU directors try to convince them of the value of giving work to small businesses and, if needed, remind them that regulations require it.

“The job certainly has it challenges,” said Kevin Boshears, OSDBU director at the Homeland Security Department.

One problem is that OSDBUs often get little support within their agencies, said Theresa Alvillar-Speake, OSDBU director at the Energy Department.

That’s where the OSDBU Directors Interagency Council comes in.

OSDBU directors and small-business specialists started the council on their own initiative. Although it can’t make policy, it has become a forum for sharing ideas and talking about new ways of working with small businesses.

“It’s the good old OSDBU network,” Alvillar-Speake said. “We get together and commiserate and share.”

Signs of progress
Small-business contracting still doesn’t receive the same amount of attention that other initiatives do, but agency leaders are recognizing its importance, observers say.

In 2007, the Small Business Administration published its first Small Business Procurement Score Card, which graded agencies on how many of their contracting dollars went to small businesses in various socioeconomic classes. Half of the 24 agencies graded earned the lowest score because they didn’t award enough dollars to small companies.

After SBA announced the scores, agency executives began asking about the contracting goals. Several OSDBU directors — including Lewis and Jeanette Brown, director of the Environmental Protection Agency’s OSDBU — now report directly to the agency’s secretary as the chief adviser on small-business matters.

“Typically, if it flows down from the top, it’s going to have a more positive impact,” said Anthony Martoccia, director of the Office of Small Business Programs at DOD. He reports to the Defense secretary.

Brown said she gained support from her agency’s leaders when Marcus Peacock, EPA’s deputy administrator, added small-business procurement goals to program managers’ performance measures. She even began giving regional offices and program managers who meet their goals an award in the form of a crystal duck.

As the small-business goals become more prominent for acquisition planners, OSDBU directors have offered their expertise to contracting officers and program managers.

“They don’t live it and breathe it every day so they don’t understand the intricacies,” said Debbie Ridgely, OSDBU director at the Health and Human Services Department.

In part because of the growing interest in regulatory changes related to small businesses, OSDBU directors have been included in discussions in which the acquisition officers and program managers are planning future contracts. And more than one agency requires that the OSDBU be part of early discussions.

For example, DOE’s regulations stipulate that acquisition-planning teams give the OSDBU director an opportunity to review upcoming programs to determine whether any of the work could go to small businesses. The director must sign off on the strategy for it to move to the next stage of the process.
“We back them in,” Alvillar-Speake said. “They kind of listen then.”

Officials who issue governmentwide procurement policies have also given more authority to OSDBUs. Burton said one of the most prominent efforts on behalf of small businesses was OFPP’s policy to require an agency to get its OSDBU to approve strategic sourcing plans.

“You must ensure that the OSDBU had input into it,” he said. It puts small-business considerations at the top of procurement officials’ agendas as they enter into long-term contracts with vendors.

Read the story: FCW.com News - Making noise for small business

Ruling clouds future for buyers

2008-11-17T20:58:00.013-05:00

Experts debate the potential impact of a GAO decision on small-business contracting

The Government Accountability Office’s recent ruling that agencies must set aside some task orders for small businesses could give those firms a new advantage, some observers say. But others say it remains unclear how much the ruling will change how agencies do business.

GAO sustained a protest by Delex Systems, which argued that the Navy should have limited competition for an aviation training products delivery order to small businesses because at least two small firms could have offered bids.

The Navy solicited bids through its Training Systems Contract II, a multiple-award, indefinite-delivery, indefinite-quantity (IDIQ) contract, which features two small businesses and six large businesses.

Under the rule of two, the Federal Acquisition Regulation requires agencies to set aside any order of more than $100,000 if the agency finds that at least two qualified small businesses could enter bids. In the Delex case, the Navy argued that the rule applies to contracts, not task orders. GAO’s ruling marks the first time the rule of two has been interpreted to apply to task and delivery orders.

“GAO tipped the playing field in favor of small-business contract holders,” said Alan Chvotkin, executive vice president and counsel at the Professional Services Council. The ruling significantly changes the landscape for agencies’ and contractors’ acquisition strategies, especially for multiple-award contracts with a mix of small and large companies, he added.

As a result of GAO’s decision, program managers and contracting officers will likely give more weight to small-business set-asides in their initial acquisition strategies, said Ray Bjorklund, senior vice president and chief knowledge officer at FedSources.

“Small businesses should capitalize on this opportunity,” said Andy McCann, vice president and geographic sales leader for EDS’ U.S. Government and Public Sector business.

A mixed verdict
However, at this point, many companies are trying to understand how the ruling will affect them. An executive at a major systems integrator said large companies were not happy with the ruling, but the outcome depends heavily on how a contracting officer interprets GAO’s decision. Integrators might need to adopt new bidding and partnership strategies, especially on multiple-award contracts that feature large and small businesses.

Likewise, the ruling could cause small companies to seek new strategies for working with integrators, McCann said.

“This ruling creates an incentive for small businesses to strive to be selected on IDIQ contract vehicles or to team with a large integrator on an IDIQ contract,” McCann said. It might also encourage companies to put a greater emphasis on their mentor/protégé programs.

“Through our small-business program, EDS has established and maintained strong relationships with small businesses and has introduced them to new business opportunities with EDS,” he said.

Other experts say GAO’s decision will not give small companies any new advantages. “On the surface, this may seem to be a benefit to small businesses, but the price may be too high,” said Guy Timberlake, chief visionary and chief executive officer at the American Small Business Coalition. Timberlake said the decision might strain the already tense relationship between agencies and small businesses.

John Howell, a partner at law firm Sullivan and Worcester, said any time GAO or Congress institutes a new requirement, agencies push back, straining their relationships with small businesses.

Officials and experts agree that the ruling could widen the rift between government and industry. Already, agencies and firms are slow to trust one another. Some experts speculated that agencies now might assume that contractors plan to protest losses and even factor the costs of pursuing those protests into their bids, raising the costs to government.

The cost of doing business
Lee Harvey, the Army’s deputy program executive officer for enterprise information systems,, said fewer companies protested award decisions a decade ago because they wanted to avoid making a fuss and preferred to maintain good relationships with the government. However, today’s larger orders make people want to protest, he said. Companies have more at stake.

Companies that don’t file frequent protests might still be tarnished by agencies’ perception that contractors in general do so, Timberlake said.

“The business of doing business with the government today is so overwhelmingly out of focus that, in my opinion, we’re no longer looking at the true picture of industry and government partnering,” Timberlake said.

Earlier this year, Congress gave GAO the authority to hear task-order protests because they have become so complex and widely used that they are now the equivalent of what full contracts are, experts say. Agencies have been using task orders for more than half of their procurements in recent years, compared with 14 percent in 1990. In the 1990s, the government viewed task orders as distinct from contracts and put those orders outside GAO’s jurisdiction.

GAO will keep its new authority to review task-order protests for three years. Legislators plan to evaluate the effects before then and make any necessary changes.

In the meantime, GAO’s recent ruling could change how agencies view orders and contracts.

“More of these multiple-award opportunities might be issued as full-and-open [competitions] with no set-aside components, creating a more prohibitive competition environment for the average small business,” Timberlake said.

Harvey recently predicted that agencies would take that course in the near future. He said agencies, particularly those under pressure to buy what they need quickly, might resort to the Big Bang theory of procurement: one competition for one big contract.

Bjorklund agreed that agencies will likely reassess the use of multiple-award contracts in light of GAO’s Delex ruling. They will probably ask themselves why they should go through the hassle of awarding an IDIQ and then go through another competition for task orders, he said.

However, some experts say GAO’s decision won’t affect multiple-award contracts that separate small and large businesses.

The ruling will have little effect on NASA’s Solutions for Enterprisewide Procurement, a governmentwide acquisition contract, said Joanne Woytek, NASA’s SEWP program manager. SEWP is organized into four groups of multiple-award contracts. Two are for small businesses, with one of the two set-asides for small companies owned by service-disabled veterans. The other two are primarily for large businesses, though a few small businesses are in the mix.

Woytek said the ruling might affect a few orders in the groups that lack set-asides, but the small companies in those groups are generally winning orders when they submit a reasonable bid.

“We have always encouraged contracting officers to provide a small-business preference, and now it will be more targeted if two of the small companies in the open groups can and want to provide a reasonable quote,” she said.

Whether or not the ruling offers an advantage to small businesses, it has left the contracting community in limbo.

“The decision changes the rules of engagement” and leaves new questions unanswered, Chvotkin said. “It changes procurements midstream.”

Read the story: FCW.com News - Ruling clouds future for buyers

State turns buyers into strategists

2008-08-21T20:08:00.006-04:00

The state of Georgia is rethinking how it buys things.

For decades, the state relied on people called order-takers to handle purchases. When a purchase request arrived from a state agency, the order-taker posted it for the public to read. Soon, proposals would arrive, and after opening all bids in public, the order-takers chose the bid with the lowest price.

They considered few details surrounding the initial purchase request.

“They didn’t read it, they didn’t look at it, they didn’t analyze it,” said Brad Douglas, commissioner for Georgia’s Department of Administrative Services, which is leading the change in thinking. “That price had no bearing on what the price could have been or should have been.”

Georgia’s buying process lacked strategy and information. The result was a procurement system from the Dark Ages. It left officials with no insight on who was buying what or from whom. But a revolution has been happening in the Peach State’s procurement programs over the past three years. Officials are pushing order-takers to be strategists when buying, rather than simply awarding based on price alone.

“Purchasing has always been the place that people went to when an organization didn’t know what else to do with them,” Douglas said. But during recent economic declines, officials noticed that smart acquisition adds to the bottom line. “That’s when I think you saw purchasing as a profession change its colors.”

In 2003, when Republican Gov. Sonny Perdue took office, he urged agency officials to think differently about how they operated. He wanted them to run their organizations like businesses — to know where their money goes and find ways to save it.

In an interview with CIO Magazine in 2007, Perdue said the primary business principle he wanted to bring to Georgia was fact-based decision-making.

“Heretofore, I think our state had been run on a lot of emotional, political, ‘who’s-in-power’ decisions rather than on data,” he told the magazine. “I don’t consider myself particularly gifted from an intuitive standpoint. Therefore, I have to rely on data and facts to make decisions.”

The data
Douglas and the Administrative Services Department are hunting for any available spending data and are bringing about new ways to grab it.

In 2005, when Douglas arrived at the department, he found state employees
didn’t keep records of their suppliers and contracts, so his department couldn’t review what was happening in the more than 120 agencies and 35 public state universities that spend the state’s money. The last audit was done in 1991, he said.

“My best source of spending data today is by asking a supplier, ‘What did you sell to the state of Georgia?’ ” Douglas said. “That’s not a good position to be in.”

Officials continue to restructure the procurement system to capture information on purchasing for better buying decisions, such as through strategic sourcing. Strategic sourcing allows organizations to save money by buying large quantities of goods or services from a single vendor. Sometimes multiple organizations will pool their requirements to negotiate the best volume discounts the vendor will offer.

In developing that strategy, the department created a knowledge center, which will handle the procurement analyses. The vision for Georgia’s procurement overhaul is to aggregate spending across its agencies and organizations that typically operate independently. Agencies use different types of software to gather data. There are at least 34 different instances of PeopleSoft, Douglas said. In July, Georgia signed a contract with SciQuest, an e-procurement management company, to bind together the agencies’ incom patible software programs.

SciQuest intends to give the state a buying system that will become the hub and spoke for the state’s procurement system, said Stephen Wiehe, president and chief executive officer at SciQuest.

SciQuest’s software will give the state an online shopping center that integrates the various PeopleSoft instances, he said. Officials expect to gain insight into how the state spends money while eliminating paper-based processes and driving spending to pre-negotiated contracts.

The law
One other barrier stood in the way of Georgia’s procurement reformers: The state’s procurement law. It obstructed good buying practices, not always for any clear reason. For example, agencies weren’t allowed to negotiate with vendors on the contracts. Douglas said officials knew each round of negotiations saves an average of 4 percent to 5 percent from the initial proposed price.

“It was stunning to me,” he said.

The time
The law now allows agencies to negotiate. That was one of several changes that resulted from reform legislation in 2005.

Not long after taking their positions, Douglas and Tim Gibney, assistant commissioner at the State Purchasing Division of the Administrative Services Department, started talking to legislators about the procurement system and the need for reforms.

They found that the season was ripe for change. While Perdue pushed new thinking on agencies, state officials explained the procurement problems for the legislators in the Georgia General Assembly. In 2005, the assembly easily passed legislation granting more flexibility to state agencies.

State Rep. Allen Freeman, a Republican who sponsored the legislation that ultimately changed procurement policies, wasn’t surprised by the rigid rules that oversaw purchasing.

“I’ve seen it from every side,” Freeman said. In the early 1990s, he managed a state park in southwest Georgia with an archeological museum on Indian burial mounds. “I had to use the contract book, just like everyone else,” he said. That book told state employees which vendors they could buy from and what price they had to pay.

The 2005 law gave the Administrative Services Department a lot of authority to improve acquisition. It allowed the department to canvass all sources of supplies and to have general supervision of all storerooms and stores operated by the state.

Douglas said the essential ingredients for making the transformation are top-down belief in the changes, resources and money to do the job, and legislative reforms to do what is necessary to bring about the transformation.

Officials set up pre-negotiated contracts for purchasers and are now collecting more data, but Gibney said the work isn’t easy. The state has a $34 billion annual budget, and its agencies and universities are unaccustomed to culture shifts such as this. “But we’ve been given the tools to go at it,” he said.

The people
In the knowledge center, there are advocates for the agencies’ buyers, as both consultants and listeners, who bring back complaints and suggestions to the knowledge center to improve overall operations. The center is training those buyers to think differently and see their individual purchases as part of a whole buying system.

“We felt not only did we need to have strong buying and contracts in place, we also wanted to improve the quality of work being performed and to train and educate folks,” Gibney said. Their work in procurement and understanding the profession overall is critical to an agencies’ success.

“My major goal — as Rodney Dangerfield said — has been to get some respect for the profession,” Gibney said.

Read the story: FCW.com News - State turns buyers into strategists

Bill would kill rule on women-owned business

2008-08-16T12:45:00.003-04:00

The Senate may stop a controversial proposal from the Small Business Administration that would limit the type of set-aside contracts given to women-owned small businesses.

A 40-word provision in the Senate’s version of the fiscal 2009 Financial Services and General Government Appropriations Act (S. 3260) would block the proposed rule. The rule would allow agencies to set aside some contracts for women-owned small businesses, but the proposal would only allow the set-asides in four select industries, such as kitchen cabinet manufacturers.

Read the story: FCW.com News - Bill would kill rule on women-owned business

Vet-owned business advocate criticizes VA bill

2008-08-13T20:02:00.004-04:00

The House’s attempt to help service-disabled veterans get federal contracts lacks any real influence, a leading veteran business advocate said Aug. 7.

The Improving Veterans’ Opportunities in Education and Business Act (H.R. 6221), passed on Aug. 1, would mandate the Veterans Affairs Department to include provisions in its contracts and agreements with other agencies requiring them to give preference to service-disabled, veteran-owned small businesses.

“This is feel-good legislation,” said John Moliere, a service-disabled veteran and president of Standard Communications. The amount of business done through interagency agreements doesn’t add up to much money, he said.

Read the story: FCW.com News - Vet-owned business advocate criticizes VA bill

Services contracts lead in Iraq funding

2008-08-12T17:00:00.004-04:00

Contractors providing the government with administrative and management services in Iraq took the major share of federal contract dollars obligated between 2003 and 2007, according to a report released today.

In analyzing federal contract data, the Congressional Budget Office found government agencies obligated 80 percent of the $85 billion in contracts spent in Iraq on services contracts. Specifically, contractors offering administrative and management services received $26 billion, or approximately 30 percent of the money. Most of those dollars went to contracts classified as “logistics support services,” a broad subcategory of services contracts that can include equipment and property maintenance, according to the CBO’s report, “Contractors’ Support of U.S. Operations in Iraq.”

Read the story: FCW.com News - Services contracts lead in Iraq funding

SBA measures economic impact on HUBZones

2008-08-11T20:17:00.000-04:00

Small Business Administration officials have developed a new method for measuring the economic impact of small-business contracts on poor areas, SBA’s chief economist said today.

SBA officials want to measure the effect on employment and household incomes of people living in Historically Underutilized Business Zones compared with the amount of federal contract money that goes to HUBZone businesses.

Read the story: FCW.com News - SBA measures economic impact on HUBZones

Bill would put more eyes on purchase cards

2008-08-06T21:14:00.002-04:00

Federal employees who use government purchase cards could have more eyes watching them.

Under the Government Credit Card Abuse Prevention Act (S. 789), the IGs would have to regularly report to the Office of Management and Budget about violations and punishments, as well as agency trends that might lead to improper behaviors. They would also suggest other ways of aggregating an agency’s spending, according to the bill.

Read the story: FCW.com News - Bill would put more eyes on purchase cards

Restrictions seen hurting disaster recovery

2008-08-05T17:07:00.002-04:00

Federal Emergency Management Agency officials should work with chief procurement regulators to avoid limits to subcontracting that could strain efforts to respond quickly to disasters such as Hurricane Katrina, according to a new report.

Richard Skinner, the Homeland Security Department's inspector general, wrote in a report released Aug. 4 that legislation passed by Congress in 2006 that restricts subcontracting by prime contractors could inhibit disaster responses and recovery work by FEMA or other DHS agencies.

Read the story: FCW.com News - Restrictions seen hurting disaster recovery

A push for more competition

2008-08-04T20:22:00.006-04:00

Departments will likely soon feel more pressure from policy-makers to buy more products and services through competitive bids, rather than sole-source contracts.

The federal government has competed approximately 64 percent of its procurements (based on dollar value) each year since fiscal 2005, although total procurement spending has increased from $371.8 billion in fiscal 2005, according to the Office of Federal Procurement Policy.

Members of Congress and the Bush administration’s chief procurement official said they believe agencies can do more, and they are looking for new ways to push agencies along.

Read the story: FCW.com News - A push for more competition

Committee approves Williams nomination

2008-07-30T20:08:00.007-04:00

The nomination of Jim Williams as administrator of the General Services Administration was approved unanimously today by the Senate Homeland Security and Governmental Affairs Committee and sent to the full Senate.

Sen. Joe Lieberman (I-Conn.), the committee’s chairman, said he was satisfied with Williams’ answers regarding a controversy involving Sun Microsystems, and called Williams an outstanding candidate for the position.

Lieberman and the committee's ranking member, Sen. Susan Collins (R-Maine), said they questioned Williams extensively regarding his role in renegotiations of a contract with Sun, which stirred controversy. The contract raised concerns about whether the company had not provided the government with the appropriate discounts on its products and services.

“I don’t know if his actions were perfect in retrospect, but I am convinced that his motivations were always in the best interest of the taxpayers,” Collins said. “I believe he is the ideal person for this position at a very critical time.”

However, as reported July 29, Sen. Charles Grassley (R-Iowa) is expected put a hold on the nomination, which would keep the Senate from considering Williams. (Read more here.)

Read the story: FCW.com News - Committee approves Williams nomination

Grassley plans hold on Williams nomination

2008-07-29T20:32:00.002-04:00

Sen. Charles Grassley (R-Iowa) will put a hold on on the nomination of Jim Williams to be administrator of the General Services Administration if the Senate Homeland Security and Governmental Affairs Committee approves Williams' nomination tomorrow, a spokeswoman for Grassley confirmed today.

Grassley had opposed Williams' nomination, saying July 24 that his "concerns are based on my investigation of a dubious GSA contract with Sun Microsystems.”

Read the story: FCW.com News - Grassley plans hold on Williams nomination

SBA faulted on set-aside check

2008-07-28T21:30:00.003-04:00

“Faith-based contracting” doesn’t bring out the best in people. In those situations, “we sit back and hope and pray the company we’re doing business with isn’t ripping us off too badly,” said Bruce Causseaux, a senior-level specialist for forensic audits and special investigations at the Government Accountability Office.

Causseaux said the Small Business Administration appears to be taking that approach with its Historically Underutilized Business Zone program, which is designed to provide federal contracting opportunities to businesses in low-income areas.

During a recent investigation, GAO auditors found numerous examples of ineligible companies being accepted into the HUBZone program.

Read the story: FCW.com News - SBA faulted on set-aside check

Denett: Agencies can compete more contracts

2008-07-24T21:05:00.001-04:00

The government held competitions for 64 percent of its contracting dollars in fiscal 2007 — a stable percentage of the past three years — but the chief procurement officer said agencies can grow beyond that number.

Read the story: FCW.com News - Denett: Agencies can compete more contracts

Clearance reform gets a boost

2008-07-22T20:50:00.002-04:00

A new Bush administration directive could mitigate one of the sticking points that plague the federal government’s process for granting security clearances: reciprocity.

Agencies are often unwilling to accept clearances granted by other agencies, forcing career-changers — and their would-be managers — to wait out a process before they fully can move into a new job.

Executive Order 13467 mandates that other agencies accept background investigations and adjudications conducted by one agency. Once the process is in place, this order is expected to help reduce the backlog, freeing resources to focus on new clearances.

Although this is only one of numerous problems with the clearance process, the Bush administration has laid a foundation on which to begin the reforms, observers say.

Read the story: FCW.com News - Clearance reform gets a boost

Committees want reports on contractors

2008-07-18T21:51:00.002-04:00

Leaders in the intelligence community would have to keep closer tabs on what contractors are doing in their agencies under bills pending in Congress.

Some members of Congress have proposed one-time, comprehensive reports on contractors under the House and Senate versions of the fiscal 2009 Intelligence Authorization Act, H.R. 5959 and S. 2996.

Read the story: FCW.com News - Committees want reports on contractors

Officials: HUBZone program is open to fraud

2008-07-17T17:39:00.001-04:00

Investigators uncovered serious lapses in a Small Business Administration contracting program after they received set-aside small business status by using false identification, officials said today.

Read the story: FCW.com News - Officials: HUBZone program is open to fraud

Senate: DHS must sort workforce mix

2008-07-15T22:00:00.001-04:00

The next administration has plenty of major challenges ahead, and one of them is figuring out how to manage an acquisition workforce in which government employees are intermingled with contractors.

Read the story: FCW.com News - Senate: DHS must sort workforce mix

What acquisition employees want

2008-07-14T20:04:00.003-04:00

Experienced midcareer acquisition employees have become very important to their organizations and valuable to agencies with worked piled on empty desks. As a result, agencies in need are wooing knowledgeable acquisition employees from other agencies. But for agencies intent on keeping those personnel, officials have suggestions that may stop precious employees from answering the calls.

Read the story: FCW.com News - What acquisition employees want

Competitive sourcing gets a new name

2008-07-11T17:48:00.004-04:00

Competitive sourcing no longer carries that name. The system's new name is "commercial services management," officials said today.

With the name change, acquisition officials are recognizing the ways agencies are trying improve their commercial operations, according to the Office of Federal Procurement Policy. Also, agencies are using several techniques to do so, such as competitive sourcing, OFPP said in a memo released today.

Read the story: FCW.com News - Competitive sourcing gets a new name

DHS' blended workforce worries senators

2008-07-10T19:56:00.003-04:00

Members of a Senate committee are concerned that the Homeland Security Department continues to rely on contractors, instead of growing the expertise it needs internally, according to a new report.

The Senate Appropriations Committee said in a report accompanying a spending bill the panel approved June 19 that its members were concerned that contractors are performing work that is more appropriate for federal employees or contractors are doing work that comes close to inherently governmental functions.

Read the story: FCW.com News - DHS' blended workforce worries senators

EPA wants controls on sole-source contracts

2008-07-09T20:41:00.004-04:00

Environmental Protection Agency officials are adding a “second set of eyes” to ensure noncompetitive contracts have all the necessary signatures before they are awarded, according to a recent letter.

By July 31, EPA will put new internal controls over sole-source procurements valued at more than $550,000, which require several officials' signatures before award. The agency will revise its acquisition handbook to require contracting staff members one level above the contracting officer to review and approve justifications for sole-source procurements.

Read the story: FCW.com News - EPA wants controls on sole-source contracts