Wednesday, July 29, 2009 and the Process of Transparency

One of the leading initiatives of the Obama Administration was to usher in an era of transparency and accountability, which came full circle with the recent controversy of the website contract award. This award, won by the Maryland firm Smartronix, Inc., has been under fire for what appeared to be a lack of transparency by the Recovery Accountability and Transparency Board (RATB), questionable contracting practices, and its whopping $18 million price tag.

The process to award this contract took an interesting turn via a discussion started on GovLoop by Mary Davie of GSA, who mentioned a post by Clay Johnson of Sunlight Labs on their lessons learned from attempting to bid on the project. What is interesting about the post is that the company took a somewhat naïve approach to the contract, and thought their innovation would simply win out. What Sunlight found out was that the government contracting process has its own maze of checkpoints that need to be followed to be considered for an award, regardless of the solution being offered.

As I mentioned on GovLoop, I found the post by Mr. Johnson to be a very interesting one, as Sunlight’s experience sheds light on the government contracting process and how contracts are awarded. Further, the post also demonstrates needed platforms for introducing innovation, such as DoD's mentioned by Ms. Davie. As my profession is to be an expert in the federal acquisition process and help guide my government customers through it, it is interesting to get perspective from others on the outside looking in. Several things jumped out at me from Clay’s post:

1) He is being pragmatic about the contracting process. He admits that he submitted a bid not having any idea what he was doing more or less, and lost out to firms that have marketed themselves and done all the upfront business development and relationship building. Of course the bid was competitive, but the government is a buyer like anyone else, and wants to know that the firms they do business with will perform, lower risk, and perform. Understanding that collaboration will help small businesses in the end will go a long way to not only help small businesses, but the government and ultimately the taxpayer though firms that have educated themselves on the process and have provided best value to the Government.

2) His firm was not qualified to do the work, but submitted the bid anyway and believes that their solution has given their company a foot in the door through awareness and branding. Although that may be the case, the opposite may also be true. I have reviewed many proposals in the past in various engagements from firms that do not answer the requirements and who clearly do not know what they are doing. If they were the Government, would they pick their firm? This often leads to resentment for wasting time and resources. If they had a unique, innovative solution for data management and knowledge exchange through open collaboration platforms, they should have gone another route and not wasted the Government’s time. They perhaps could have submitted an unsolicited bid through proper channels, or found a better way to partner or join a team interested in advancing the idea. I get emails everyday from people asking me for advice on whom to market their unique service that no one else has and will save the Government millions, etc. My response is always the same; prove it. I rarely hear back.

3) The good news certainly is that they have a better idea of the process. Furthermore, they understand that in this situation for this website, it has turned into a “careful what you wish for” scenario, as both Smartronix, Inc. and the RATB have come under enormous scrutiny for the contract and the way it was awarded. I do not see how it will be possible to fulfill these requirements in the schedule and budgetary parameters set forth in the contract. My understanding is that the RATB fell into the perfect formula of setting things up for failure: poorly defined requirements, unrealistic schedules and budgets, and the coup de grâce, enormous political pressure. Not a recipe for success. I hope the Inspector General and Government Accountability Office are sharpening their pencils.

Learning how to fail is one thing, but learning from the failures defines success. I hope that Clay and Sunlight Labs understand the next time that the Government is a very sophisticated buyer, albeit not the most efficient one. Nonetheless, transparency can only help shed light on the process, and I for one cannot but help be see positive outcomes coming from this exercise. Further, sharing innovation can only lead to better solutions, so I hope this experience does not deter Sunlight Labs or other firms that have high-value solutions.

Tuesday, July 28, 2009

Acquisition Workforce Reform Starts From Within

The Federal Acquisition Innovation and Reform (FAIR) Institute, a nonprofit focusing on federal contracting reform, earlier this month released a report on acquisition workforce development in conjunction with their Point of View series on federal contracting. The report, like their earlier work, is a common-sense approach to tackling difficult issues in the federal contracting arena. Their latest report is worth noting since so much attention seems to be focused on numbers and hiring acquisition personnel instead of creating a strategic approach to capability building and filling needs and preventing further knowledge gaps.

I have written about this subject on numerous occasions, and the latest FAIR report mirrors what I believe is a successful formula for realizing true acquisition reform, which is to focus on people and developing an in depth analysis of the internal environment for long-term retention and development.

As the report notes, today’s current acquisition environment is poorly aligned and balanced due to the lack of a right-sized and properly skilled acquisition workforce:

… Acquisition, which should be a strategic business process, has instead become a production line environment. The emphasis is strictly on getting the money out the door and worrying later if the right thing is being bought. Workforce resources are focused on awarding a contract, and once that’s done, handing the contract off to a usually ill prepared and uninterested Contracting Officer’s Technical Representative (COTR); meanwhile the program manager and contracting officer start to churn out the next contract…

This is absolutely the case, as the concept of the business manager and strategic advisor has been subsumed through a focus on merely output. This current environment is unsustainable for workforce development, as new hires will feel marginalized, overwhelmed, and soon be burned-out without the prospects of seeing any chances of career advancement or development. Instead, they will enter a system where acquisition personnel are drones, in a world where the ability to think strategically is not possible for the sake of time, and limited ability to improve skills to concentrate on positive outcomes. Further exacerbating the dysfunctional environment, as noted by the report, are external pressures, contradictory policy changes, inspector generals who have become the oversight body, and the creation of a “no-win” situation for acquisition personnel who are some of the most important players in government operations and first-line stewards of taxpayer funds.

Fixing this environment requires careful planning, in addition to a parallel focus of hiring strategies to get high-quality candidates engaged for public service. Along those lines, structural changes are necessary to make a difference. The report notes that creating a single acquisition series will go a long way to develop a life-cycle process where all players are involved up-front to make integrated decision and create an environment where real outcomes are the norm. This process involves program management, contracting, and requirements management. These three pillars are the foundation for government contracting, and need to done in parallel and fully integrated for a procurement to be successful. However, it is the requirements management function that is the one that is most intriguing, and the one most often neglected in the current environment. According to the report:

…Creating the specialty of a Requirements Management Specialist would address many of the issues plaguing acquisition. A dedicated function with appropriate. training and experience covering the full life cycle of requirements – from initial definition to final delivery – would provide emphasis on the importance of this function that is lacking in the current structure. This position would be for someone who could translate the users’ and program managers’ need into an acquisition package and then manage the resulting contract after award...

Starting out with poorly defined requirements will often lead to poor acquisition outcomes. It is a simple formula. A recent report by Business Executives for National Security identified the requirements definition process as a critical breakdown in the process. The current process needs to be an interactive and collaborative one, where the use of social media tools and technology are the drivers for exchanging knowledge. Organizing the acquisition community into a fully integrated workforce will also help organize and manage data and drive an effective needs development process that includes all stakeholders and has a focus on quality, technological maturity, and feasibility for cost and schedule realism. This is opposed to the current process which is often declarative, and serves the end-user or the warfighter poorly.

Of note is the fact that these changes can realize enormous impacts and have a positive direction on acquisition reform. All that is needed is sound, strategic leadership without the need for legislation. As the FAIR report points out, focusing externally on acquisition workforce reform is a losing strategy that will require us to have the same discussion in the near future. The pendulum can no longer keep swinging as we face enormous budgetary pressures with no end in sight. Let’s cure the disease and not focus on symptoms once and for all.

Thursday, July 23, 2009

Real Acquisition Reform with ANCs

The central pillars of acquisition reform are to prevent and eliminate waste, fraud, and abuse. To that end, Sen. Claire McCaskill (D-Mo.), chair of the Senate Homeland Security and Governmental Affairs Committee’s Contracting Oversight Subcommittee, held a scheduled hearing to take a closer look at the Alaska Native Corporation (ANC) 8(a) program. Although the fate of the ANC program is unclear, the hearings, analysis from Sen. McCaskill’s staff, an SBA IG report, and similar investigations conducted by the Government Accountability Office, which concluded that the ANC program is an “open checkbook” for these companies, clearly demonstrate the need to reform this program and bring it back into parity with sound government contracting practices.

Although no one is disputing the good that these programs to do for Alaska Natives, the question is what are the real benefits of continuing this program which has clearly been abused. Sole source contracts to ANCs rose dramatically this decade, from $508.4 million to $5.2 billion, according to Sen. McCaskill’s report. Further data in the report included the so-called benefits of this astonishing growth: $615 each per year to the 130,000 Alaska Natives who are company shareholders. The report further details the apparent misrepresentation by supporters of these programs, since Alaska Natives do not seem to be enjoying the fruits of these revenues as only a small percentage (approximately 5 percent) of ANC employees are Alaska Natives and a vast majority of executive compensation is earned by non-Alaska Natives.

Although defenders of ANCs point out the millions of dollars of scholarships, internship programs and other civic organizations donated by these firms, I would argue that many companies with these revenues do the same as just being good corporate citizens. It should also be pointed out that firms donate to similar initiatives without the enormous and unwarranted privileges ANCs command.

Shay Assad, the Defense Department's top civilian procurement official, testified that additional competition for ANCs may be appropriate in certain circumstances, in addition to ordering a review for why Defense goes to the sole-source well so often with ANCs and the need for more oversight of subcontracts to ensure that ANCs are following federal regulations and performing at least 50 percent of the work associated with these awards:

…"I respect the need to provide economic opportunities for 8(a) ANCs," he said. "However, based on the department's experiences with the 8(a) program, I think there may be ways to promote additional competition in appropriate circumstances. Taxpayers would benefit because their dollars would be more efficiently and effectively spent."…

Mr. Assad only need walk into a contracting shop at the Pentagon to get answers to his questions on why sole-source awards are the norm; the empty chairs and frantic pace of the skeletal crew of acquisition personnel. Contracting Officers have a perfect tool to save time and bypass oversight, scrutiny, and the competitive acquisition process since they can award sole-source awards to ANCs without the normal 8(a) award guidelines. These decisions are also often conducted without verifying what is in the best interest of the government or if they are being good stewards of taxpayer money.

What I find troubling, and also telling, is that supporters of the program seem to be offering little substance in their arguments or providing clear evidence that the ANC program is providing the benefits to the magnitude they claim. Many ANCs should not even be in the 8(a) program with revenues of hundreds of millions of dollars. What kind of “small” business has these types of revenues, or has armies of lobbyist anyway?

On the other hand, ample evidence has been provided in the aforementioned reports that ANCs are stifling competition and being used as shell companies to funnel money and contracts to a network of companies that are not ANCs and do not directly impact Alaska Natives:

…"I firmly believe that many small businesses will routinely bypass procurements where ANCs are involved," Lumer said, "because the chances of winning are so small, even if they are allowed to compete in the first place."…

Stifling competition ultimately leads to poor business decisions and waste, fraud, and abuse. Acquisition reform should include a restructuring of this program in the name of parity, competition, and fairness. No one is arguing to eliminate the program or that ANCs do not provide valuable services to the government or their constituents, but the costs seem to be outweighing the benefits. If supporters of the program disagree, it is up to them to prove it.

Thursday, July 9, 2009

Web 2.0 Can Recruit New Workforce

From Federal Computer Week

As the discussion about acquisition reform continues in Congress and throughout the federal government, a new emphasis is emerging on workforce development as critical to successful acquisitions. Concern about the nearing wave of large-scale retirements has grown for the past several years, yet no good solution has emerged.

Recent press coverage has highlighted the potential of Web 2.0 technologies, also referred to as Gov 2.0 initiatives, to enable the government to reach out to the largest pool of viable candidates with a messaging strategy that conveys the benefits of government service. President Barack Obama’s campaign used a comprehensive social-media model to connect and deliver information, and the government should be doing similar strategies when it comes to sharing information in hopes of attracting talent. One of the central tenets is to make government service attractive, and sharing information via social media is an effective way to inform the next-generation workforce.

Several agencies, including the CIA, NASA and the Defense Department are realizing the value proposition of social media and have taken a comprehensive effort to attract and hire talent from a range of sources. The General Services Administration has also been on the forefront of thought leadership combined with an investment in technologies to execute the agency's social-media strategies. Visionary leaders at GSA, such as David Drabkin, Mary Davie and Casey Coleman, use social media to share information with staff members and customers. That engagement in social media can have a direct effect on how effectively an agency reaches a receptive audience with its targeted messages.

Leadership is vital to help craft the culture’s comfort level with Web 2.0 technologies and risk-taking, in addition to creating a social-media strategy centered on the capabilities and skills of the target audience. Leaders should help convey the message, which should be specific to agency operations. This message should be crafted both internally and externally — for example, on an agency's Web site though the use of blogs and video content — in addition to allowing conversation and the ability to solicit feedback and post responses. Agencies should also showcase the organization as a great place to work by highlighting their people and what they do.

Leaders should also help craft culture by educating staff members on the benefits of Web 2.0 technologies and how social media affects their work and performance, in an effort to help retain talent and give new hires from the next-generation workforce opportunities to perform and keep them engaged so they feel that government is where they want to be.

The next generation of federal employees will be looking for a government presence in social media, and the government will suffer if it is not there.