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April 13, 2010 By AMK

House panel proposes more defense contracting reforms

House Armed Services Committee leaders plan to introduce legislation April 14 that would push for more reforms of the Defense Department’s acquisition system, including workforce management, competition and financial management deficiencies.

Named the IMPROVE Acquisition Act, the proposal seeks to fix the remaining 80 percent of the procurement system left untouched by major reforms in 2009, the committee said.

The bill aims to overhaul the acquisition system, getting equipment to the warfighter in combat faster and saving an estimated $135 billion over the next five years, the committee said.

The committee said the legislation would require DOD to comprehensively manage its acquisition system and its acquisition workforce. It would reform financial management through incentives. The bill would enhance competition for contracts by “responsibly” expanding DOD’s industrial base to gain access to more cutting-edge technology.

The proposals are based on the committee’s Defense Acquisition Reform Panel, the committee said. The panel offered recommendations to the committee last month on how Congress could fix problems in the defense acquisition system.

After nearly a year of hearings, the panel concluded DOD’s antiquated acquisition system and policies present major problems in fulfilling today’s mission needs. The out-of-date system contributes to program costs ballooning beyond expectations, according to its report from March.

In its report, the panel said DOD should get more from the industrial base by improving contracting and competitive practices and should push for better innovation and make use of small and mid-tier businesses. Panel members want DOD to repeal a rule that allows agencies to withhold 3 percent of contract payments in anticipation of taxes owed to the Treasury Department. The panel called the rule a “new obstacle” to getting into the commercial marketplace. Some companies without tax problems won’t offer bids because of such rules, it said.

The panel recommended DOD expand its Office of Performance Management and Root Cause Analysis, which would track acquisition workforce performance based on predetermined benchmarks and “would promote real consequences.”

The report has proposals for new regulations for fair and transparent acquisition workforce hiring, assignments and performance appraisal. Specifically, the panel said DOD should extend the Acquisition Workforce Demonstration Program, which aims to improve personnel management and policies. The program is set to expire in 2012.

“There is no doubt that the department needs an acquisition workforce that is as capable as its advanced weapons systems,” Rep. Rob Andrews (D-N.J.), who was the panel’s chairman, said in February.

— by Matthew Weigelt – Apr. 13, 2010 – Federal Computer Week

March 26, 2010 By AMK

DOD acquisition process ‘fails the mission,’ congressional panel says

A panel convened to examine the Defense Department’s acquisition processes has finalized its recommendations for overhauling the system after concluding a yearlong investigation that uncovered major problems in DOD procurement.

The Panel on Defense Acquisition Reform, established by the House Armed Services Committee in March 2009, said in its report that DOD’s mishandling of acquisitions and procurement fails to fulfill the military’s current mission needs and contributes to massive cost overruns. The final report largely tracks an interim document released March 11.

“The panel found that while the nature of defense acquisition has substantially changed, the defense acquisition process has not kept pace,” the report stated. “As a result, the Department’s formal acquisition policy has limited application to the majority of [its] acquisitions.”

To successfully reform its approach to acquiring weapons, services and other goods, the panel recommended “significant improvements” in managing the acquisition process, developing and incentivizing the highest quality workforce, improving financial management, and maximizing the industrial base.

Other recommendations included expanding the Office of Performance Management and Root Cause Analysis, which would track acquisition workforce performance based on predetermined benchmarks and “would promote real consequences,” according to the report.

The report included recommendations for new regulations for fair and transparent acquisition workforce hiring, assignments and performance appraisal. An extension of the Acquisition Workforce Demonstration Program, which aims to improve personnel management and policies and is set to expire in 2012, was urged as well.

The panel called on DOD to reform its financial management system, and said that without improvements here, true acquisition reform throughout the department may not be possible.

Also, the panel advised that DOD get more from the industrial base by improving contracting and competitive practices, pushing for better innovation and making use of small and mid-tier bases. Panelists also moved to repeal of a rule that allows agencies to withhold 3 percent of contract payments in anticipation of taxes owed to the Treasury Department.

— by Amber Corrin – Mar. 26, 2010 – Federal Computer Week

March 10, 2010 By AMK

Panel says DOD needs ‘significant improvement’ in managing the acquisition process

The Defense Department’s antiquated acquisition system and policies present major problems for DOD in fulfilling today’s mission needs and contribute to government cost overruns, a congressional acquisition reform panel has concluded in a recent report.

To successfully reform DOD’s approach to acquiring weapons, services and other goods, the panel recommended “significant improvements” in managing the acquisition process, developing and incentivizing the highest quality workforce, improving financial management, and maximizing the industrial base.

A performance management structure that allows DOD’s senior leaders to identify and correct problems and offer reinforcement would improve performance metrics, for which there is currently only “anecdotal information,” the report stated. To implement such a structure, the panel recommended the expansion of the Office of Performance Management and Root Cause Analysis to track organizations based on predetermined performance benchmarks, which would promote real consequences, according to the report.

DOD “leaders should be focused on identifying and addressing the acquisition systems strengths and weaknesses, not on second-guessing the programmatic decisions made by those in the field,” the report said.

Better performance management for the requirements process, on which acquisition depends heavily, also is necessary, the panel found. It expressed alarm over DOD’s ad hoc approach to developing requirements for the acquisition of services, as well as the “overly cumbersome” and inadequate approach to weapons requirements.

The panel also is pushing for more accountability across all aspects of the acquisition process, particularly for DOD financial management. “The inability to provide accurate and timely financial information prevents DOD from adequately managing its acquisition programs and from implementing true reform,” the report stated. It added that with 86 percent of government assets – with an estimated value of $4.6 trillion – DOD must maintain strong financial and business management.

Accountability in the use of contractors is also important for acquisition reform, the panel found, calling for better use of the broader industrial base and trustworthy contractors. DOD “is best served when it deals with responsible contractors. Contracting officers need access to accurate information on contractors that are known to be in violation of the law” in order to determine if a contractor is responsible, the report said.

The House Armed Services Committee commissioned the Defense Acquisition Reform Panel in March 2009.

— by Amber Corrin – Mar. 10, 2010 – Federal Computer Week

February 25, 2010 By AMK

House panel links acquisition reforms to people

After a year of hearings, the chairman of a House panel on Defense Department acquisition reforms today said DOD needs help in how it hires employees in the acquisition field so it can build up its workforce.

DOD must develop new regulations for hiring the civilian acquisition workforce, said Rep. Rob Andrews (D-N.J.), who chairs the panel that the House Armed Services Committee set up last year. The rule should include “fair, credible and transparent” methods to bring in new employees. DOD also needs regulations on how it assigns workers and for appraising and rewarding employees’ performance, he said.

“There is no doubt that the department needs an acquisition workforce that is as capable as its advanced weapons systems,” Andrews said.

Many of the common problems the panel has found in its 12 hearings since March 2009 can be traced back to employees. Andrews said DOD faces broad problems in managing the acquisition system and the process of defining a program’s requirements. He added that DOD should make significant improvements to develop and motivate its employees to get the highest quality of work.

The department also needs a reformed financial management system and a system that is fit for the Information Age. He said the defense acquisition system has not kept pace with the changes in the market.

“The system remains structured primarily for the acquisition of weapon systems at a time when services represent a much larger share of the department’s acquisitions,” Andrews said, adding that the system isn’t designed for buying information technology.

Andrews said the Defense Acquisition Reform Panel is approaching the end of its work and it’s beginning to formulate its findings and recommendations. The panel will report them to the Armed Services Committee and may be included in the fiscal 2011 or future defense authorization bills.

As the panel has worked over that last year, Andrews said only anecdotes exist about instances where the acquisition systems are working well or poorly.

“Even when real performance metrics currently exist, they do not fully address the question,” he added. “The panel continues to believe that real metrics are needed.”

— by Matthew Weigelt – Feb. 25, 2010 – Federal Computer Week

February 1, 2010 By AMK

Obama proposes expanding acquisition workforce

The acquisition workforce is one of the few areas of federal employment the Obama administration wants to expand, an official said today.

Peter Orszag, director of the Office of Management and Budget, said the number of contracts and government spending has doubled, but the acquisition workforce, which includes employees who handle the work of developing a contract’s requirements, reviewing bids and awarding contract, has had little growth.

“It’s not too hard to figure out that oversight of those contracts has not kept pace with what it should be,” he said at a press briefing on the fiscal 2011 budget proposal.

In 2000, the government had 26,751 contracting officers and the number had grown to only 29,707 by 2008, a 9 percent rise, according federal figures.

The administration is trying to invest in greater oversight of what the government buys, Orszag said. Specifically he said the administration wants to crack down on no-bid contracts, buy goods and services in bulk, and increase the acquisition workforce’s size so the government can better oversee its contracts.

As the administration looks to increase the acquisition workforce, officials said in the budget proposal documents that the world has changed to a knowledge-based economy. “Half a century ago, most white collar federal employees performed clerical tasks, such as posting Census figures in ledgers and retrieving taxpayer records from file rooms,” the proposal states.

The administration proposed spending $24.9 million for training the acquisition workforce. The money would support interagency initiatives and projects that improve the ability of civilian agencies to assess the size and skills of their procurement employees. It would also provide funds for agencies to find the best mix between public employees and private sector contracts carrying out agency work, the budget proposal states.

Over the past year, the Obama administration has emphasized its concerns that agencies have allowed contractors to do too much in conducting their operations.

“The activities supported through this fund are intended to foster and promote the development of the acquisition workforce,” the budget document states.

In addition, the agencies have the Acquisition Workforce Training Fund. The mandatory appropriation of funds is for civilian agencies to train their employees. It’s financed by 5 percent of the fees collected from civilian agencies’ procurements from governmentwide information technology acquisition contracts, the General Services Administration’s Multiple Award Schedules program, and other multi-agency contracts.

Meanwhile, officials are working with the Office of Personnel Management to simplify and streamline the hiring process. They also want easier checkpoints so the people applying for federal jobs can check online to see what’s happening, Orszag said.

— by Matthew Weigelt – Feb. 1, 2010 – Federal Computer Week

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