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Three R’s of Acquisition Reform

Stan Soloway, President, Professional Services Council
Stan Soloway, President, Professional Services Council

Acquisition Reform – Industry experts have compared it to Groundhog Day and a complicated system of pendulums shifting between priorities.  The descriptions may differ but one thing most agree on is that with federal acquisition becoming ever more complex, fixing it isn’t getting any easier.  In fact, Frank Kendall, the Under Secretary of Defense for Acquisition, Technology and Logistics, said June 13 he dislikes the term “acquisition reform” because it suggests “that there are dramatic things we can do to significantly improve acquisition. It’s more about a process of continuing improvement.”

So what are some ways federal acquisition can be improved?  Integrity Matters asked Stan Soloway, President and CEO of the Professional Services Council (PSC), who just published an article on innovation in which he describes the current acquisition system as “calcified and inefficient.”  He points out three places to start.  We’ll call them three R’s: Risk, Reward and Review.

Integrity Matters:  What do you think is the biggest roadblock to acquisition reform?

Stan Soloway:  I think the biggest roadblock is the continued risk aversion of the system as a whole and the intolerance for failure. It’s sometimes referred to as a zero defect mentality.  Whenever something goes wrong, somebody or many somebodies have to have somebody to blame. And that’s bipartisan, it’s the Hill, it can be the administration, it can be the press.  That risk aversion, that intolerance of failure drives a risk aversion in the system.   You actually have a workforce that can recognize innovation opportunities but is unwilling to take the chance of doing it knowing that most innovations have a failure rate.  Government leaders should say, ‘hey we took a chance and we failed so let’s move on and let’s learn from it.’

Integrity Matters:  PSC makes several acquisition-related recommendations in its 2013 Leadership Commission Report, including around the issue of human capital.  How does that present a problem for acquisition reform?

Stan Soloway:   The bottom line is, I think the government has a demographic crisis that is understated not overstated.  The acquisition community is seeing an increasingly junior workforce, which is a good thing in the sense that you have the next generation coming in. But increasingly, junior means you have people with less experience than you would have had before, who are actually being tasked with much more complex business requirements because there is no next group. There is a huge bathtub between them and the senior group.

The flipside of that, the other half of the demographic crisis and maybe the equal if not greater problem, is the severe drain on the technology workforce.  In the IT workforce for every worker under age 30, you have ten over 50.  And so you have a workforce where you’d ideally like to see a whole lot larger cadre of young talent coming in with technology and you have the acquisition workforce where young talent is good, but you need a more seasoned workforce because the business relationships and the deals and the requirements are much more complex as we go into a much more technology-driven environment.

Integrity Matters:  How do you recommend approaching that problem?

Stan Soloway:  It’s very hard to run an innovative, hard-charging kind of entity, which the public has come to expect because they see it every place else in their lives, with a peanut butter workforce – in other words, a workforce where everything is even.  There is both a philosophical and structural change that needs to take place, including more rewards for performance, more tolerance of risk.  Even the absolutism around salaries and that virtually everybody gets paid the same regardless of what you do. That’s not fair.

The second is a whole different level of strategic thinking that needs to take place.  The market is being set not by government contractors, but by the commercial market place.  There the demand for talent, particularly technical talent, is so overwhelming that the government is going to have to increasingly adapt its strategies to deal with that and that will mean contractors because they’re the conduit to that talent.  It may also mean the government will have to radically rethink some of its personnel practices so it can attract more of that talent than it has, not to be the operators but to at least provide the senior level guidance and direction that you want the government to have.

Integrity Matters:   PSC has recommended 360 degree assessments or reviews of acquisition process outcomes.  Why is that necessary?

Stan Soloway:   We know there are these enormous disconnects between industry and government and within and among government entities and functions. The idea here is that you create a measuring tool to drive continuous improvement.  Stakeholders get to evaluate the process on crosscutting levels and from an individual perspective. Those are very functional perspectives as a tool to help the acquisition organization and the customer understand what they could do to get better outcomes.

If a contracting officer is principally evaluated by the contracting leadership on how many procurements they get out, “well they get them done, no protests,” that’s a fair measure, but the most important measure is whether the customer gets what the customer was hoping to get.  What we find in every study where there have been acquisition problems, they start at the pre-RFP phase, so hopefully this review will drive more of that collaborative process.

Our thanks to Stan Soloway for sharing his thoughts.  What do you think are the top challenges to acquisition reform?  How should they be addressed?

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