A new procurement vocabulary

In the early days of procurement reform in the mid-1990s, federal officials liked to describe information technology as a commodity—something that should be bought with as little fuss as possible, like appliances or office supplies.

That is now changing. White House and congressional officials have asked agencies to view technology as an investment, not just a commodity. They have asked agencies to show the link between their IT spending and their overall mission, and to prove that those investments pay off.

Now more than ever, contracting officers are talking in terms of "total solutions" and "performance-based" contracts.

"The trend is continuing away from making IT buys for IT's sake, but looking at fully integrating something into an agency," said Larry Allen, executive director of the Coalition for Government Procurement, a nonprofit association of more than 350 companies that sell commercial services and products to the government.

Bob Barr, director of government marketing at Dell Computer Corp., said agencies have changed the way they spend IT budgets as their technology knowledge and needs mature.

"As government technology has evolved, so has where the money is spent," Barr said, adding that the demand for Dell's enterprise products, including servers and storage solutions, has skyrocketed because agencies are more strongly focused on "total cost of ownership."

"It's not just the nature of the box, but the support and services that back [it] and the quality of that box," he said. "Now, they want us to ship a box with software pre-installed and imaged on it," whereas before, government employees handed the installation themselves.

Barr said by pre-installing software and offering better services, Dell and other companies are freeing the government's valuable human resources "so government IT professionals can work on mission- critical" duties.

Others agreed. "Last year was a defining year in the federal marketplace," said Wayne Kelly, assistant to the president of the federal sector at Computer Sciences Corp. "We didn't necessarily work harder, but we worked smarter. There was a tremendous amount of pressure to provide the right kind of value proposition for the client to justify the project itself."