risk management | The Contracting Education Academy

December 16, 2020 By cs

GAO: Agencies should assess contracting workforce needs and purchase card fraud risk

The Government Accountability Office (GAO) recently examined how federal agencies use contracts and purchase cards to acquire goods and services to get urgently needed items after a disaster.

Specifically, GAO assessed selected agencies’ planning for contracting workforce needs and purchase card fraud risks related to disaster response.

Overall, here’s what they found:

Not all agencies planned for or assessed their contracting workforce needs for disaster response.
Only 1 of the 6 agencies assessed how purchase card fraud risks change during disaster response.

Contracting Workforce

The efforts of selected agencies to plan for disaster contracting activities and assess contracting workforce needs varied. The U.S. Forest Service initiated efforts to address its disaster response contracting workforce needs while three agencies — the U.S. Army Corps of Engineers (USACE), the U.S. Coast Guard, and Department of the Interior (DOI) — partially addressed these needs. The Environmental Protection Agency (EPA) indicated it did not have concerns fulfilling its disaster contracting responsibilities.

Within three agencies examined, GAO found the following:

USACE assigned clear roles and responsibilities for disaster response contracting activities, but has not formally assessed its contracting workforce to determine if it can fulfill these roles.
The Coast Guard has a process to assess its workforce needs, but it does not account for contracting for disaster response activities.
DOI is developing a strategic acquisition plan and additional guidance for its bureaus on how to structure their contracting functions, but currently does not account for disaster contracting responsibilities.

Contracting officials at all three of these agencies identified challenges executing their regular responsibilities along with their disaster-related responsibilities during the 2017 and 2018 hurricane and wildfire seasons. For example, Coast Guard contracting officials stated they have fallen increasingly behind since 2017 and that future disaster response missions would not be sustainable with their current workforce.

GAO’s strategic workforce planning principles call for agencies to determine the critical skills and competencies needed to achieve future programmatic results. Without accounting for disaster response contracting activities in workforce planning, these agencies are missing opportunities to ensure their contracting workforces are equipped to respond to future disasters.

Purchase Cards

Among the five agencies GAO reviewed, plus the Federal Emergency Management Agency (FEMA), more than $20 million was collectively spent for 2017 and 2018 disaster response activities using purchase cards. GAO found that two of these six agencies — Forest Service and EPA — have not completed fraud risk profiles for their purchase card programs that align with leading practices in GAO’s Fraud Risk Framework. Additionally, five of the six agencies have not assessed or documented how their fraud risk for purchase card use might differ in a disaster response environment. DOI completed such an assessment during the course of our review.

An OMB memorandum requires agencies to complete risk profiles for their purchase card programs that include fraud risk. GAO’s Fraud Risk Framework states managers should assess fraud risk regularly and document those assessments in risk profiles. The framework also states that risk profiles may differ in the context of disaster response when managers may have a higher fraud risk tolerance since individuals in these environments have an urgent need for products and services. Without assessing fraud risk for purchase card programs or how risk may change in a disaster response environment, agencies may not design or implement effective internal controls, such as search criteria to identify fraudulent transactions.

Recommendations

As a result of its review, GAO made a total of 12 recommendations which address the need for three agencies to assess disaster response contracting needs as a part of overall workforce planning, and for five agencies to assess fraud risk for purchase card use in support of disaster response. GAO’s complete report can be found here: https://www.gao.gov/products/GAO-21-42#summary.

October 13, 2020 By cs

Combat leaders go through hell to learn about risk … the acquisition corps should do the same

One reason the ‘culture of innovation’ hasn’t taken proper hold at the Pentagon is that its buyers aren’t trained over and over to weigh uncertainties.

Why does the Pentagon remain unable to properly exploit the opportunities afforded by advances in technology and other fields?

It’s not for lack of exhortation: a long list of Defense leaders, up to and including the current secretary, has urged the Department’s people to innovate, to take risks.

They don’t know how.

This is no slur on today’s acquisition corps, which is full of bright, hard-working people. But making good judgments in the face of risk is hard. It involves a complex web of decisions, actions and counteractions that often spiral well beyond the scope of the original task. The higher the stakes, the tougher risk management becomes. The same is true of combat — which is exactly why the military insists that its combat leaders train and study and review and practice, over and over again, in ever-more complex scenarios, so that they are as ready as possible to handle real risk.

Keep reading this article at: https://www.defenseone.com/ideas/2020/09/combat-leaders-go-through-hell-learn-about-risk-acquisition-corps-should-do-same/168543/

November 29, 2019 By cs

Supply chain security requires acquisition reform, security experts say

To secure the government’s IT ecosystem, agencies must better understand their tech, the vendors who built it, and those companies’ suppliers.

The government can make significant progress in securing its IT supply chain by following a few basic procurement practices, but most agencies have yet to adopt them, according to federal security experts.

While government leaders have recently given a lot of attention to the supply chain security threats posed by foreign vendors, officials must devote equal energy to reforming their acquisition policies so they put those warnings to good use, experts said. Those efforts require an in-depth understanding of both the government’s IT infrastructure and the countless firms in its vendor pool, they said, but today that remains a challenge for most agencies.

“Supply chain [security] is where we were with cyber[security] maybe 15, 20 years ago,” Michele Iversen, director of risk assessment and operational integration at the Defense Department, said during a panel at the recent Fifth Domain’s CyberCon event. “We really don’t really have the visibility that we need to know where the threats are and what’s actually happening.”

Keep reading this article at: https://www.nextgov.com/cybersecurity/2019/11/supply-chain-security-requires-acquisition-reform-security-experts-say/161251/

October 31, 2018 By AMK

DHS to use federal procurement to further reduce risks to the supply chain

The Homeland Security Department’s initiatives over the past year to address supply chain risks aren’t even close to hitting a crescendo. But the pace and volume of the drumbeat is distinctly mounting.

If the efforts to ban Kaspersky Lab, ZTE and Huawei products were just the prelude to the symphony, then the National Risk Management Center’s initial sprint topics, the business due diligence request for information and the latest effort to use the power of federal procurement are the opening sonata.

“There is a growing awareness and understanding to this issue. Our biggest challenge today is not having a national strategy around it while other countries do,” said Jennifer Bisceglie, president and CEO of Interos Solutions, which provides risk assessment services. “Until we have a national strategy, you will have pop up policies or programs or studies, like the one from MITRE. The time is beyond here to have a national strategy.”

The White House’s National Cyber Strategy gave a brief mention to supply chain risk management, saying the government should “improve awareness of supply chain threats and reduce duplicative supply chain activities within the United States government, including by creating a supply chain risk assessment shared service.” But it offered no specific details or initiatives.

Keep reading this article at: https://federalnewsnetwork.com/reporters-notebook-jason-miller/2018/10/dhs-to-use-federal-procurement-to-further-reduce-risks-to-the-supply-chain/

August 29, 2017 By AMK

Pentagon acquisition reorg is all about ending culture of fear of failure

For the Defense Department to recapture its broad technological advantage over the rest of the world, it can’t be afraid to fail once in a while.

Under that specific direction from Congress, the Pentagon detailed a plan to shake-up its Acquisition, Technology and Logistics (AT&L) office in the Office of Secretary of Defense with two main goals in mind: Accelerate the development and acquisition of cutting edge technology, and change the mindset of those buying, developing and managing technology.

To that end, DoD announced it will create a new Undersecretary of Defense for Research and Engineering (USD(R&E)) and a new Undersecretary of Defense for Acquisition and Sustainment (USD(A&S)) and offered its first detailed description of how it plans to use the newly-created position of chief management officer.

“In order to deliver new and needed capability to the warfighter, USD(R&E) will take risks while pushing the technology ‘envelope,’ testing and experimenting and being willing and allowed to fail when appropriate,” the report stated. “Once technological and integrated solutions have been identified and matured, USD(A&S) will minimize further risk, as necessary to ensure the needed capability is delivered and sustained in the most timely and cost-effective manner possible. The fact that the two organizations most integral to the delivery of effective and sustainable systems and services approach risk from such different perspectives reinforces special challenges.”

Keep reading this article at: https://federalnewsradio.com/defense/2017/08/pentagon-acquisition-reorg-is-all-about-end-culture-of-fear-of-failure/