17 words that will change acquisition

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

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.

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Obama: Big changes coming in federal contracting

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.

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Field surveys landscape as chief

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.

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Bill would put more eyes on purchase cards

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.

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The IPv6 elevator speech

Many federal agencies have appointed transition managers to be advocates for IPv6. Transition managers are given the authority to implement an Office of Management and Budget policy that requires agencies to install IPv6 software on their networks by June 30. Those managers will be busy with many tasks between now and the deadline, but they say their toughest challenge will be getting the attention of senior executives.

IPv6 is a tough sell, and the only opportunity to pitch it might be during an unplanned encounter with an agency’s top executive. Powell said transition managers must be ready to deliver a short, memorable speech about IPv6, often referred to as an elevator pitch. Who knows when information technology officials might have an opportunity to make a brief presentation to senior executives? Powell’s first recommendation to managers writing such speeches is to drop the term IPv6 and replace it with next-generation Internet.

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Procurement chief chides IGs

The Office of Management and Budget’s Paul Denett said some agency inspectors general are emboldened now more than in the past, often to the point of essentially directing agencies’ programs.

Denett, administrator of the Office of Federal Procurement Policy, said he believes some IGs are overstepping the boundaries of their statutory role, adding that “they get aggravating sometimes.”

Those comments, which Denett made at a recent industry conference, highlight the growing strained relations between IGs and the agencies they oversee. Auditors and procurement experts say the relationship has become tense at some agencies.

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Survey focuses on green purchases

Congress and the White House want to know if agencies buy with the environment in mind.

The survey, which the Office of Management and Budget distributed along with a Nov. 1 memo, asks agencies specific questions about their efforts to purchase environmentally-friendly products.

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OMB adds to High Risk list

The Office of Management and Budget has added 50 information technology projects to its High Risk List since August, bringing the total to 603 projects the agency is concerned about.

The projects equal at least $15.5 billion in IT spending for fiscal 2008, OMB said today.

The boost in numbers continues a trend at OMB.

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Encryption BPAs are open to all

A newly opened door for state and local governments to buy from federal contracts signifies improving intergovernmental relations, according to procurement officials who announced 10 precedent-setting blanket purchase agreements last week. The BPAs offer encryption products and services to protect sensitive, unclassified information stored on laptop PCs and mobile computing and removable storage devices.

The Office of Management and Budget joined the Defense Department and the General Services Administration to announce the contracts are open to state and local governments. The BPAs represent the largest federal procurement opportunity to date for state and local agencies, and they create a path for future licensing agreements, said David Wennergren, DOD’s deputy chief information officer.

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OMB: 2006 competitive sourcing could save government $1.3B

Public/private competitions in fiscal 2006 could save the government about $1.3 billion in the next five to 10 years as competitive sourcing pushes agency employees to become more efficient, according to the latest results in the Office of Management and Budget's competitive-sourcing report.

The estimated total savings based on the 1,243 competitions completed between fiscal 2003 and 2006 could reach about $6.9 billion in five to 10 years and yield about $1.1 billion in savings annually, the report states. Officials believe savings will continue to grow as agencies conduct more competitions and apply cost control and other performance improvements to more commercial activities, the report states.

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Feds stay competitive

Federal employees beat private contract employees in 19 of 22 public/private job competitions that four science agencies conducted from fiscal 2003 through fiscal 2005. Science agency officials said insider knowledge gives agency employees an advantage over their private-sector competitors.

The Office of Management and Budget’s Circular A-76 policy allows companies to take over certain jobs performed by federal employees if they can do the work more efficiently.

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Anonymous survey to help determine acquisition skills

Government contracting specialists will soon be able to anonymously check their skills on an online survey, according to the Office of Federal Procurement Policy.

OFPP, the Federal Acquisition Institute and the Office of Personnel Management want to know if the acquisition workforce is adequately trained. The survey will help them learn about specialists’ skills and determine gaps and needs. It will also aid in improving organizational and individual planning efforts, according to a March 7 OFPP memo.

The assessment is a component of a comprehensive initiative to study the acquisition workforce.

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OMB's budget theme continues: Do more with less

The Bush administration will push to improve existing information technology programs, but it has proposed few major new IT investments in its fiscal 2008 budget request.

Industry officials immediately criticized the budget, saying it will force federal contractors to adjust to a spending climate in which agencies must do more with the IT they have. The budget attributes the decrease in new investments to better capital planning and reduced duplication.

President Bush proposed greater spending increases for defense, energy, health IT and information security, which are administration priorities.

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Evans: IT budget numbers reflect priorities

The fiscal 2008 budget proposal increases total spending on information technology to $65.5 billion, or 2.6 percent over fiscal 2007’s $63.8 billion funding request, said Karen Evans, the Office of Management and Budget’s administrator for e-government and IT.

The budget proposal seeks an average overall IT funding increase for civilian agencies of 3 percent, according to budget documents from OMB. The administration has requested IT increases for slightly more than half of agencies.

Notably, the Nuclear Regulatory Commission had a 45.5 percent increase, an increase of $43 million more than the fiscal 2007 request. All of the NRC’s 14 project business cases are on the Management Watch List for fiscal 2008, which OMB officials will supervise carefully, Evans said in a briefing with reporters.

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OMB wants input from feds via Results.gov

The Office of Management and Budget intends to improve communications with federal employees by using a retooled President’s Management Agenda Web site, Results.gov.

As part of a relaunch announced Feb. 1, OMB is looking to the Web site as a way to exchange ideas with employees about good management practices, building on the management improvements achieved through PMA over the last five years.

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Building the IT workforce is a priority for CIO council

The Chief Information Officers Council has issued its strategies for advancing information technology and e-government through fiscal 2009, including efforts to build up the IT workforce.

The council’s broad strategic plan, issued Jan. 24, pushes President Bush’s goals of applying IT governmentwide before the administration ends. The council intends to focus on the federal infrastructure, the line of business initiatives, secure information and the IT workforce’s capabilities.

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OMB score card neglects citizens, report states

The Executive Branch Management Score Card that measures the use of e-government in agencies neglects citizen input, according to a new report.

The Office of Management and Budget scores agencies quarterly on how well they are instituting the President's Management Agenda, but the scoring leaves goals related to citizens untracked, said Jenny Whitmer, senior research analyst at Government Insights, an IDC company, and author of the report, “Citizen-Centered eGovernment Needs Performance Measures for Success.”

OMB needs to measure citizen satisfaction or possibly risk ignoring the citizen-centered aspect of the initiative as agencies push to match the agenda’s performance metrics, according to the report, which was released today.

“For all the emphasis the [agenda] admirably puts on leveraging [e-government] to strengthen government’s citizen service, the OMB score card exhibits a serious deficiency in actually taking that initiative,” Whitmer wrote.

OMB’s score card evaluates agencies in five areas of the agenda: workforce, competitive sourcing, financial performance, budget and performance integration, and e-government. In the fourth quarter of fiscal 2006, eight agencies earned red scores in e-government, 10 earned yellow and eight green.

The report recommends that OMB's scoring criteria add citizen satisfaction metrics from focus groups, surveys and polls. Several groups, such as the University of Michigan’s quarterly American Customer Satisfaction Index, already gauge what citizens think about e-government.

Whitmer also suggests comparing federal agencies in the U.S. to other governments. The United Nations, for instance, tracks the progress of e-government worldwide. Canada, Australia and New Zealand have well-developed methods to assess citizen feedback on their e-government initiatives, Whitmer wrote.

OMB influences agencies’ behavior with the score card, Whitmer said.

“For better or worse, performance measures drive the direction of an organization’s efforts,” she said. When performance measures get so much attention from agencies, their effect is not trivial, she wrote in the report.

Current metrics focus on enterprise architecture, information technology investments with good business cases, investment planning under earned value management analysis, secured IT systems and the inspector general’s rating of secured systems, and agencies' use of e-government.

“This administration’s goal is to champion citizen-centered electronic government that will result in a major improvement in the federal government’s value to the citizen,” the agenda’s introductory report from fiscal 2002 states.

Agencies are feeling the pressure to incorporate the agenda into their organizations, Whitmer wrote. To meet the administration’s citizen-centered objective, “a comparison of the goals and the performance measures used to track them suggests a mismatch,” the report states.

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