DoD Needs to maintain flexibility to deliver better outcomes to warfighters, taxpayers

The Defense Department plans to slice more than $100 billion from its budget over the next five years and, happily, it has decided to do so with the input of industry, the acquisition workforce and other stakeholders who would be affected by the trimmed back spending.

PSC was one of a handful of industry associations invited to a special meeting with Undersecretary of Defense for Acquisition, Technology and Logistics Ashton Carter on June 28. PSC’s Executive Vice President and Counsel Alan Chvotkin participated in the meeting where Carter presented proposed guidance that includes calls for acquisition professionals to buy competitively, choose the right contract for the job, include small businesses in multiple award contracts, and reward excellent contract performance.

“We share the goals that Undersecretary of Defense Carter has identified for the department and while many of the recommended guidelines—such as increasing competition and choosing the right kind of contract—are laudable, PSC is concerned about how the department proposes to implement them,” Chvotkin said after the meeting.

“Services covers a broad span of activities and no one size fits all. Yet some of his initial recommendations may unnecessarily limit flexibility,” Chvotkin said. “For example, the department is right to focus on choosing the right contract vehicle, but why take a tool out of the toolbox by eliminating time and material contracts?”

PSC will present its recommendations in meetings with department officials over the next few weeks. What DoD will do with this information remains to be seen. Carter said he will issue final guidelines by the end of the summer. But the fact that he asked industry for feedback is an encouraging sign that the forthcoming guidance could result in smart contracting.

Smart Contracting Outlook: FY 2011 NDAA is a Mix of Smart and Not-so-smart Contracting Policies

The Professional Services Council’s own Stan Soloway and Alan Chvotkin briefed the media on our take of the House and Senate versions of the fiscal 2011 National Defense Authorization Act.

Conclusion: some provisions are smart contracting, others…not so much.

Take the House provisions on insourcing. The provision that prevents agencies from setting insourcing quotas: Smart. Agencies should think strategically before insourcing to ensure what is brought in house truly needs to be performed by the government to provide the essential “organic” capabilities needed to keep the government in the driver’s seat.

However, a provision telling agencies to insource any work currently contracted out or any new work, thus encouraging insourcing of non-strategic functions found in any phone book: Not smart. Budgets are already tight and hiring authorities are limited. Agencies shouldn’t be wasting time and money insourcing work that is not mission critical and won’t save taxpayer dollars.

OFPP Proposed Workforce Policy Too Complex, Lacks Clarity

The Professional Services Council, through the Council of Defense and Space Industry Associations (CODSIA), made recommendations to the Office of Federal Procurement Policy on how it can improve its proposed policy letter “Work Reserved for Performance by Federal Employees” to avoid creating an environment that would promote arbitrary insourcing at federal agencies.

The proposed policy letter sought to clarify the definition of what constitutes “inherently governmental” work that must be performed by federal government employees and to provide guidance to agencies to help them identify functions “closely associated with inherently governmental” and “critical” functions that should also be reserved for federal employee performance.

But we felt that agencies could misinterpret the proposal as a mandate to insource work that is neither inherently governmental nor critical to government’s mission performance, such as base maintenance, information technology support or other tasks found in the yellow pages.

To avoid a final policy that results in wide-scale, non-strategic, quota-driven insourcing, we recommended OFPP:

• Provide a clear definition and examples of what constitutes inherently governmental work;
• Combine the categories of “closely associated with inherently governmental functions” and “critical functions” into one narrowly defined category to eliminate duplication and confusion;
• Require that agencies to submit and publicize a list of their inherently governmental and critical functions and define which critical functions must be reserved for performance by federal employees;
• Require agencies establish a comprehensive human capital plan and conduct in-depth cost comparisons before making insourcing determinations for work that could be performed by either the public or private sectors.

Abt CEO Flanagan: Company Mission is “Improving People’s Lives”

Two weeks ago, PSC testified at a hearing where the commitment of federal contractors and their employees to the government’s mission was questioned. Obviously those questioning that commitment haven’t talked to contractors the way the Boston Globe’s Beth Healy did in this May 23 profile of Kathleen Flanagan, the chief executive of Abt Associates, a PSC member company actively involved in our International Development Task Force. The entire piece is worth a read, but I’d like to highlight Flanagan’s response to Healy’s question of what drew her to the development field.

Flanagan said:

"I’m very passionate about making a difference, and Abt is a mission-oriented company. Abt is dedicated to improving people’s lives, to helping our clients improve programs, and going into fragile countries or underdeveloped countries and raising them up.”

That sounds a lot like dedication to mission and public service to me. And it serves as a good reminder to those who question the motives of for-profit contractors: it IS about the mission.

When it comes to insourcing, greater analysis is needed to avoid mission paralysis

Federal agencies, quite rightly, are determining where they may have gone overboard with outsourcing by contracting out work that should have been kept in-house to maintain government control over its mission. Where agencies find they’ve improperly outsourced jobs, they’re supposed to insource only the positions that will put the government back in the driver’s seat of mission control.

But so far, the government’s execution of insourcing has been a non-strategic, quota-driven exercise, which actually threatens the government’s ability to carry out its mission in an efficient and cost-effective manner, PSC Executive Vice President and Counsel Alan Chvotkin warned the Senate Homeland Security and Governmental Affairs Committee.

“Insourcing for the sake of insourcing is no more intelligent, no more effective, and no more defensible than outsourcing for the sake of outsourcing. Nor should government accept repeating the mistakes of past outsourcing efforts when implementing insourcing efforts,” Chvotkin said at a May 20 hearing of the Subcommittee on Oversight of Government Management, the Federal Workforce, and the District of Columbia.

It’s IT Procurement Reform…and PSC Helped!

The Senate took a step toward smart information technology contracting on May 19, passing S. 920, the “Information Technology Investment Oversight Enhancement and Waste Prevention Act of 2009.” The bipartisan bill, which PSC helped the Senate Homeland Security and Governmental Affairs Committee craft, would improve agency and congressional processes to track the performance, cost and schedule of IT projects and prevent the requirements creep that often lead complex IT procurements into failure. The legislation, which was sponsored by Sens. Tom Coburn, D-Del. and Susan Collins, R-Maine, would also create an “IT SWAT Team” of government, industry and non-profit IT experts to provide skilled support to agencies managing complex IT projects. The SWAT Team would support government project managers from system development to execution to ensure it is successfully deployed. The bill now heads to the House for approval, as it travels on the School House Rock described path to becoming law.

Government contracts abroad spur jobs at home, save taxpayer dollars

What do government contracts for work removing landmines in former combat zones, protecting embassies globally and outfitting forward operating bases in Iraq and Afghanistan mean at home?

To the Tennessee towns of Lenoir City and Maryville, the more than $80 million in combined contracts two rival companies — EOD Technology of Lenoir City and Relyant of Maryville — hold with the government have created nearly 200 local jobs and generated substantial tax revenue.

To the troops in the combat zone, they have provided information technology and logistics support, as well as money-saving, climate-controlled for housing that allows for investment in other equipment.

To embassy staff around they world, they’ve provided safety through compound security contracts.

And to the communities they work in abroad, they provide roads and fields free of explosive devices and free of hazardous waste due to contracts for munitions and waste cleanup.

You can read more about the local and global impacts these firms have had in the Knoxville (Tenn.) News Sentinel.

While you read, keep in mind these are two firms with a small slice of the $500 billion government contracting pie. Given the successes of these firms, imagine what the entire government contracting community brings at home and abroad!