Pushing for results-based procurement reform

What: “Procurement: Focusing on Performance and Results,” a paper by FCW contributor Steven Kelman for the National Academy of Public Administration's "Memos to National Leaders" report.

Why: The federal government pays out $450 billion every year for goods and services, and senior leaders should know where and how that money is spent. Federal procurement reform, which would allow those federal executives a firmer accounting of that payout, has been a picking up steam for years in Washington, as new development and contracting practices, such as strategic sourcing and its parent management structure category management, take hold.

Kelman said his paper looks to provide a clearer, understandable approach to the procurement reform issue for the incoming administration, focused on improving the performance and results of the federal procurement system.

Rather than provide a long list of recommendations on how to approach and solve the problem, he targets his recommendations in three areas:

1. Developing more information about contract performance
2. Pivoting to post-award
3. Expanding forms of contracting that pay for success

Kelman suggests sensible approaches such as not directly comparing prices of commodity IT goods like laptops because pricing can be distorted by international market pressures.

He also suggests that the federal government ask industry to disclose the average pricing for items to compare against, rather than specific pricing. Specific pricing for IT good and services has produced some push-back from industry who say it can hurt them with competitors. And he calls for limiting disclosure to contracts with a large number of suppliers that would allow information to be anonymized rather than traced back to a specific contractor.

Kelman also argues that top-level procurement officials in the incoming administration should make a habit of making the “pivot” from pre-award activities to post-award contract management work. That pivot, he said, would entail moving personnel into post-award management and monitoring roles, improved training for post-award management activities and establishing forums for sharing agency experiences and best practices.

Verbatim: “A second concern is that contractors will oppose public disclosure of their prices, out of a worry that disclosure would reveal information on their government contracts to their own commercial customers. This fear suggests, interestingly, that these suppliers believe the government is getting a very good deal, which they don’t want other customers to know about! The government would need to decide for public disclosure despite industry opposition.”

For the full report, click here.