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November 15, 2010 By AMK

Senior acquisition officials question procurement policy direction

Senior federal acquisition officials do not believe that many of the signature procurement policy changes the Obama administration and the Democratic Congress have implemented in recent years are adding significant value to the government’s mission, according to a new report from a pair of industry groups.

The biennial survey by the Professional Services Council, a contractor trade association, and Grant Thornton LLP, a business advisory firm, interviewed 33 officials from across government, including senior acquisition executives, congressional staff and oversight employees, on a host of topics.

On many key issues there appears to be a widening chasm between operational and oversight officials, but they generally concurred that the implementation of major policies and rules — from the insourcing of private sector functions to the push to use fixed-price contracts — were failing to meet their stated objectives.

“The idea of showing contract savings is nothing more than an accounting exercise,” said one interviewee. “When you have policy that doesn’t make sense to subject matter experts, you lose credibility,” another said. All the quotes were provided anonymously, although the officials interviewed were identified at the end of the report.

Stan Soloway, president of PSC, suggested that many senior acquisition officials supported the administration’s overall policy direction, but felt “neutered” by a one-size-fits-all execution approach.

For example, recent legislative and regulatory actions have shown a preference for fixed-price contracts above cost-plus or time-and-materials awards. In many cases, officials are required to provide lengthy written explanations when using the latter contract types. But the survey showed that 71 percent of respondents felt the fixed-price mandates had not resulted in better contract outcomes for the government or the taxpayer.

A similar disconnect between a policy’s intention and result was found in response to questions about insourcing. Many officials argued the concept, while necessary to restore core government capabilities, has not been conducted thoughtfully or strategically and might be moving too rapidly. Meanwhile, a whopping 94 percent of respondents said insourcing will hurt small businesses.

“Insourcing is moving too quickly and it is too focused on hitting metrics,” one interviewee said. “The administration is proceeding without a larger view of how the government does business. The decision should be strategic and not rushed.”

The redefinition of inherently governmental activities, one of the key procurement regulatory changes the Obama administration has embraced, also failed to impress senior acquisition officials.

Two-thirds of all interviewees said the March guidance from the Office of Management and Budget was not clear or actionable. As was the case with several policy proposals, many cited the lack of resources needed to implement the guidance.

The survey also revealed palpable frustration among acquisition and oversight leaders regarding implementation of the Recovery Act. Two-thirds of all respondents felt they were not provided adequate resources to comply with stimulus rules and that reporting requirements were neither manageable nor sustainable. Congress, however, has shown some support for implementing Recovery Act-type requirements for all procurements.

Retired Vice Adm. Lou Crenshaw, a principal at Grant Thornton, suggested that too much focus has been placed on regulatory compliance rather than operational outcomes. “This is rocket science,” Crenshaw said. “It’s a complicated process.”

As in previous surveys, enhancing, training and managing the acquisition workforce remain the biggest operational challenges in acquisition, respondents said. They noted that while the addition of direct hiring authority at some agencies has helped to a point, constant turnover, insufficient training and a reliance on interns have created functional concerns. Acquisition officials suggested the system might be improving, but oversight officials generally were more skeptical.

Contract administrators also appeared to be struggling under the weight of oversight mandates. Nearly 90 percent of those surveyed agreed more resources were devoted to back-end oversight than front-end contract management. Others suggested overly burdensome oversight was inhibiting innovation while stressing rigidity and a focus on lowest cost.

“Resources are absolutely not in balance,” one interviewee said. “They have thrown resources at [inspectors general] and auditors, but they have done nothing to facilitate contract administration.”

The divide was evident in other areas. More than 70 percent of operational executives said existing structures designed to prevent organizational conflicts of interest function effectively. Sixty percent of oversight professionals disagreed. The two sides also disagreed on the need to reform personal conflict-of-interest rules, with operational officials generally in favor of maintaining the existing structure.

While the report did not take sides on the respective issues, it did recommend improving the communication and collaboration between the oversight and operational communities, backing up policy directives with sufficient resources, and avoiding one-size-fits-all mandates.

– By Robert Brodsky – GovernmentExecutive.com –  November 15, 2010

Filed Under: Government Contracting News Tagged With: acquisition workforce, ARRA, conflict of interest, IG, insourcing, OMB, small business

October 27, 2010 By AMK

IG: EPA faces acquisition workload issues

Officials say they’ve had no specific contract work unduly delayed or not awarded because of the current workload

The Environmental Protection Agency’s acquisition leaders will have trouble accommodating an increase in contracting work because they lack agencywide performance measures for acquisition staff members, according to a new report.

EPA’s Office of Acquisition Management doesn’t track performance metrics, and officials need that information to modify employees’ workloads in response to changing volumes and priorities, according to a report released Oct. 25 by the agency’s inspector general.

EPA officials agreed to create overall performance measures, but they disagreed with another recommendation.

The IG recommended instituting plans for dealing with potential problems related to balancing traditional activities with projects funded by the economic stimulus law.

However, EPA officials said no contract work had been unduly delayed or not awarded. They also said mandatory action plans would limit acquisition officials’ options for striking an appropriate balance between regular contracts and those related to the stimulus law, according to a letter written in response to the report.

EPA has made stimulus law and grant awards a top priority, at the expense of non-Recovery Act work, the IG wrote. That could push activities that are not related to the stimulus law to the back burner, the report states.

EPA received $7.2 billion under the stimulus law and oversees $81.5 million in work, the report states. Although that represents 2 percent of all the agency’s acquisition activities, managers have voiced concerns about the amount of work and the agency’s ability to perform it with current staffing levels.

— by Matthew Weigelt – Oct. 27, 2010 – Federal Computer Week

Filed Under: Government Contracting News Tagged With: acquisition workforce, ARRA, EPA, IG

August 18, 2010 By AMK

GSA’s IG warns of risky acquisition support

Contractors may be getting closer to handling sensitive duties as agencies buy services to augment their acquisition staff members through the General Services Administration’s Multiple Award Schedules contracts, officials say in a new report.

Federal Acquisition Service officials need to emphasize their ways to protect the government from interference by private-sector employees, according to a report released Aug. 17 by the GSA inspector general’s office.

FAS approved the addition of acquisition management support services to its Mission Oriented Business Integrated Services (MOBIS) Schedule in April 2007. In fiscal 2007 and 2008, agencies reported ordering $111.6 million in contract, procurement and acquisition support services from schedules contracts, according to the report.

However, the new services can leave an agency open to a greater risk of a contractor performing restricted services, which are often referred to as inherently governmental functions, or violating conflict-of-interest regulations.

Also, agencies placed some orders that were outside the scope of the schedules program, according to the report. As a result, agencies may have circumvented competition requirements and violated the terms and conditions of the contracts, wrote Erin Priddy, audit manager of the IG’s acquisition programs audit office.

“As a result, the government may not have received the best value for these services,” Priddy wrote.

Priddy recommended that FAS officials figure out how often contractors are doing acquisition support work beyond the schedule contracts’ scope, and which agencies are using the schedules program inappropriately. For prevention, Priddy recommended that FAS add special ordering instructions to the MOBIS acquisition support requests for quotes and spread the word about the instructions, according to the report.

FAS Commissioner Steve Kempf agreed with the report’s recommendations.

— by Matthew Weigelt – Aug. 18, 2010 – Federal Computer Week

Filed Under: Government Contracting News Tagged With: acquisition workforce, contract employee, FAS, GSA, IG

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