Protest Accountability: Time For Enforcement

Protests are back in the news, although they never really left. I have been writing about this issue for some time (here and here), but the problem has only exploded in the last five years with the economic implosion, and now sequestration and budgeting Armageddon possible on the horizon.

A recent report from IBM’s Center for the Business of Government also highlight similar issues, but some of the recommendations made in the report are either not realistic or have no chance at implementation.

The current state of the acquisition workforce, and I am including the program office who will (or should) be evaluating a proposal, simply will not allow many of these recommendations to see the light of day.

The report should have focused on the only issues that need leadership support, which is to create confidence in the contract award decision, and to ensure industry understands the requirements, evaluation criteria, and why they did not win a contract.

Nonetheless, the current state of affairs when it comes to protests is only going to worsen unless accountability is brought into the fray.

Looking at the recent Government Accountability Office (GAO) report on protests, it is hard to not think that protests are out of control. Here is where I strongly agree with IBM’s report, as I have been an advocate of protest accountability for some time. How can one argue that some protests are not simply frivolous? I know of a company, an incumbent on a contract that lost a recompete, who admitted filing a frivolous protest to bilk the government for another three months of revenue while GAO made the decision. The basis for the protest bordered on absurd, but how often does that happen? More often than you think. It is a business decision no doubt, but only at the expense of the taxpayers and the mission.

Protests are disruptive, and firms need to be held accountable for reimbursing the government for losing protest after protest. Further, this is a demonstration of a bad actor, and should also be included in a firm’s past performance rating.

Conversely, firms should automatically be compensated for protests fees should they be upheld. It is a two-way street, and needs to be treated as such.

Protests are a fundamental right by a firm to correct a deficiency by the government. However, the data indicate that this right is being abused. Let’s bring this situation under control, and move forward.

Saving Money Is Now A Good Thing: The Great Paradigm Shift

I always have to scratch my head at the curiosity of how the federal government operates in regards to budgetary matters. Although commercial best practices are all the rage in government, such as trying to leverage technologies and become more efficient, innovative, and agile, the one area that always seemed to be polar-opposite was the budget.

Commercial entities, specifically publically traded companies, have accountability to their shareholders and Wall Street (mostly Wall Street). As such, increasing productivity and lowering costs has always been a critical driver in efficient corporate operations. Unlike federal leaders, corporate leaders are held accountable for what is viewed as wasteful or excessive spending.

Although the federal government has made several initiatives as of late to increase productivity, it has always been, and continues to be, the accountability issue that has lagged the commercial sector.

That trend has seen a recent reversal. With the focus on cutting contracts, saving money is now a requirement. The Office of Management and Budget recently sent out a memo directing agencies to further tighten their belts, especially given the “TravelGate” scandal from the General Services Administration.  

Cuts are also hurting industry, as salaries, benefits, and jobs are being shed to withstand the environment of lower margins, and lower rates on bids.

…Agencies typically wait until contracts are up for renewal or entering another option year to negotiate with vendors for a better deal. But Hancher's reduced budget drove her to bargain with the agency's help desk support contractor, Computer Sciences Corp., in the middle of an option year…

Different negotiating tactics are being employed, but it is the low-price model that has really taken a solid grip on how the government now buys.

…Donna James, owner of Accent Global System Architects, which helps agencies map their IT network systems, said she started noticing last year that agencies were more focused on price than best value. She lost every bid she competed for based on price.

To be more competitive, her company cut back contributions to employees' health savings accounts and is hiring new staff at lower salaries, she said.

However, most of the contracts she competes for still call for highly skilled workers with special certifications, James said. "They want the sun, moon and stars and they don't want to pay for it."…

The federal government has turned into a buyers market, with procurement executives making difficult requirements without the opportunity for best value. I have seen a marked increase in small businesses getting squeezed to deliver, as the low-price model ensures that margins are squeezed as close to zero as possible just to stay viable. Best value is nothing more than lip service.

Several agencies seem to be getting the message, however, that early and upfront collaboration with industry is vital to understanding what is available, but also, what is affordable.

…At the Veterans Affairs Department, acquisition and IT executives meet with vendors early on about expectations and pricing, so there are no surprises on either side, said Luwanda Jones, VA's executive director of IT acquisition strategy and business relationships…

Nonetheless, we’ll see how the end of fiscal year buying season turns out; the period between July and September that I refer to as the “Feeding Frenzy.”

Will agencies continue to spend like drunken sailors in this period, or will senior leaders demand cuts and finding ways to not spend end-of-year money?

Stay tuned to see if this paradigm shift actually occurs…