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.

The Outsourcing Debate: Realism versus Rhetoric

The Federal Acquisition Innovation and Reform (FAIR) Institute, a new nonprofit focusing on federal contracting reform, released a report in response to the push by the Obama administration to reevaluate when it is appropriate to outsource and use contractors. Specifically, the report provides high-level policy guidance on the specifics of President Obama’s March memo on contracting reform, which directed OMB to issue guidance on the appropriateness of outsourcing, in addition to providing further guidance on defining “inherently governmental” positions.

The report describes some good recommendations on the insourcing issue by taking a deliberate and systematic approach based on facts and analysis. In effect, they are advocating a business case analysis, which I also believe is the best approach and serves the needs of all parties involved in a fair and thorough manner. Although there seems to be quite a bit of reporting on the consternation this issue has caused in exacerbating the anti-contractor sentiment that seems to be fomenting in government, the policy does need to be weighed carefully to ensure the government does not completely hamstring itself and be in the position where the mission is completely in jeopardy.

What seems to be missing from the conversation in the anti-contractor discussions is the fact that neglect and inattention by federal leaders has created an environment where contractors are necessary due to the lack of trained, qualified federal personnel to complete acquisition tasks. The report lists several reasons:

• Inattention to “right sizing” and “right skilling” the government workforce to support the growth and complexity of its workload.
• The antiquated and uncompetitive government personnel system, including hiring processes and pay scales, that can leave contractors as the only source of capabilities available to agency management.
• Underinvestment in training and developing people to ensure that they have the skills to perform their jobs.
• “Competitive sourcing” program that has led to outsourcing of some positions based on a complex “make vs. buy” analysis (A-76 studies).

Contractors are hired simply because the government does not have the flexibility to hire the right people, at the right time, for the right position. Therefore, hiring contractors, or “outsourcing,” remains the only alternative to obtain personnel. Instead of a focus on vilifying contractors, I believe the conversation can and should be more constructive to find common ground for common sense approaches to long-term solutions to these issues, and thus the point of the FAIR report.

Looking inward at systemic and cultural issues is one the first things that needs to be done if real change in personnel policies will have any effect on acquisition reform:

To bring talented people into government in large numbers, federal employment must once again become attractive. President Obama’s call to service certainly has heightened interest in public positions. But that by itself won’t be enough. Federal recruiting, compensation, and professional development policies and processes must change and become competitive with the private sector. While it may be feasible to hire thousands of people during the current economic downturn, it will be difficult to retain this talent unless systemic human capital issues are addressed.

Workforce development is a strategic imperative, and not a short-term fix. The federal government must reinvent its human capital strategies to see real change. The report also tackles three types of positions that should be considered for possible insourcing: inherently governmental positions, agency core competencies and long-term contracted positions.

The report cites Policy Letter 92-1, which characterized inherently governmental activities by definition

…governmental decision making because they are so intimately related to the public interest that no ulterior motivation can be allowed to arise concerning those choices and those activities…

The policy letter makes the distinction between inherently governmental and those supporting activities that contractors can provide by stating:

Inherently governmental actions do not normally include gathering information for or providing advice, opinions, recommendations, or ideas to government officials. That distinction allows the government to take advantage of private sector analysis and expertise while remaining fully in charge and in command of the decision-making.

What the report further recommends, and what is vital to ensure the inherently government function wall is not breached, is creating that strict firewall through clear and documented roles and responsibilities of any contractor personnel that are supporting activities that are closely related to inherently governmental functions (e.g. acquisition). It is when this firewall is not established that the breakdowns normally occur, and government outsources its decision making authority to contractors. The single, most important recommendation is to clearly define roles and responsibilities upfront during post-award contracting activities, as reported by the GAO on many occasions.

Agency core competencies are the second category the report outlines. This category has always been challenging to define, as subjective analysis was always used to verify what agencies considered a core competency. However, the report recommends an analysis methodology that needs to be considered to ensure a realistic approach is employed to find true definitions and impacts on core competency through an objective lens.

Value stream analysis, a common tool used in Lean Six Sigma and continuous improvement programs, can help identify activities that should be staffed with federal employees. Through value stream analysis, an agency can break down functions (such as finance, IT or acquisition) into major activities, which can be profiled relative to key decisions made, supporting analysis, information and expertise required, and expected level of activity throughout the fiscal year (among other categories). By adding the other criteria (i.e. mission related technical expertise, scale and efficiency, etc.), agencies can systematically determine core competency positions.

These types of measures should be used in the business case analysis, with a focus on cost versus benefit, and long-term financial analysis to also verify the “make/buy” decision when it comes to outsourcing positions. The report gives an example through systems engineering activities at DoD for weapons systems development, another subject area of GAO reporting on the core competencies that the Pentagon needs to retain in-house to maintain control of the decision making process.

The third item in the report is long-term contracted positions. In identifying these positions, FAIR recommends a policy that takes into consideration the duration and time frame for the positions being considered (e.g. requirements for at least an additional five years), focus on a cost/benefit analysis for most efficiency, and a continued focus on hiring and retention.

Although this pragmatic approach by FAIR is a good blueprint for further discussion on addressing the issues faced in the federal acquisition arena, the overarching issue is people. According to the Project on Government Oversight, some of the negative reaction seems partly motivated by perceived ulterior motives of the FAIR Institute itself. POGO seems to imply that the FAIR board includes members with current or past ties to industry, and thus should be treated with a watchful eye. I have no problem with this criticism, but I caution that this attitude seems to exacerbate the vilifying of contractors and does not move discussion forward in a productive manner. Based on what I have seen so far, I look forward to further work by FAIR.