Reinventing the. G-Man: Bringing Change to FBI Procurement. BY Deborah Broderick

Transcription

1 Reinventing the G-Man: Bringing Change to FBI Procurement BY Deborah Broderick 24 Contract Management June 2011

2 How the FBI is strengthening its procurement processes by strengthening its employees. Contract Management June

3 To the layperson, most government agencies are an alphabet soup of unknown and unfamiliar acronyms. At least one set of initials however is instantly recognized by millions of people around the world: 26 Contract Management June 2011

4 Reinventing the G-Man: Bringing Change to FBI Procurement FBI. From Al Capone to Al-Qaeda and Prohibition to 9/11, the Federal Bureau of Investigation (FBI) has proudly advanced its mission to protect and defend the United States against the threats of terrorism, espionage, and crime. Supporting that vital mandate means meeting a staggeringly broad range of procurement needs. Other agencies could locate most of their daily supplies at your typical office superstore. The nearly 34,000 agents and employees of the Bureau, however, require an extraordinary range of equipment and services. Depending on their jobs, FBI personnel need everything from firearms to body armor, forensic technology, medical supplies, HAZMAT suits, chemical exam kits, surveillance equipment, mobile laboratories, and emergency vehicles, among a thousand other obscure, and often unique, pieces of equipment. The service needs are equally broad, from the development of high-end monitoring systems to advanced software, analytics, and mission support functions. The Bureau also operates with certain procurement constraints that do not exist at most other agencies. Equipment is used in the field to save and protect lives both agents and civilians so reliability and effectiveness is critical. And there are a number of security issues that can make the purchasing process even more complicated. Beyond that, the needs of the modern Bureau evolve as quickly as technology does. To effectively remain one step ahead of the bad guys, agents and employees must be outfitted with the best gear, the most modern equipment, and the fastest response capabilities. However, like many government agencies, the Bureau has traditionally had difficulty meeting the rapidly changing procurement challenges of increasingly technology-driven operations. Prior to 9/11, many of our most important IT systems were outdated and running obsolete programs and systems. Walking into an office 10 years ago was like stepping back in time another 10 years, with the background glow of green cathode-ray monitors and the chatter of dot-matrix printers. Few employees or agents had even been equipped with laptops or cell phones. The software situation then was similarly problematic. Divisions within the Bureau used widely divergent software to do and accomplish the same tasks. Although the software products provided similar functionality, the programs were not compatible with each other, and it was a struggle to choose among the applications. The greatest procurement challenge we faced was not one of outdated IT or incompatible systems. Rather, it was the all too familiar issue of organizational reluctance to change and improve acquisition processes. A Fresh Look at Government Procurement Prior to arriving at the Bureau, my professional background had been entirely in the private sector. Early in my career, I worked in software programming and then moved to an accounting position at Price Waterhouse. After earning my law degree, I again shifted my focus and began working as an attorney drafting, reviewing, and negotiating commercial contracts. Contract Management June

5 Reinventing the G-Man: Bringing Change to FBI Procurement Purchasing in the private sector is very different from government purchasing. In the private sector, if you need something, you go and get it. If there are problems, you negotiate your way through them. Sure, there are budgeting and, for large purchases, approval processes to follow, but there is typically little red tape or bureaucracy inherent in those processes, and new approaches or tools that save money or improve operational efficiencies are usually welcomed. Government procurement, on the other hand, involves a complicated legal and regulatory structure that governs every part of the buying process, from market research and requirements definition to solicitation, competition, award, performance, and payment. Learning to comply with existing regulations can take years and offers a significant challenge to even experienced contracting officers. As a further complication, the federal procurement system has traditionally been geared toward stasis, with an extreme aversion to altering processes which have been in place for decades. Given the choice between the perceived risk of implementing innovative change and the apparent safety of maintaining the status quo, many procurement leaders find little incentive to step outside the box and implement new approaches or tools. When I arrived at the Bureau, I realized that we were first-rate at some things but had a steep learning curve in other areas. We were proficient, for example, at acquiring simple items with highly standardized specifications; however, developing accurate, detailed specifications for procurements of IT products and software, which have become an increasingly important area for us, has been a challenge. The issue is even more complex at the Bureau because, among all of the other typical performance specifications, we have very specific technical requirements to ensure security. Beyond the specific issues inherent in the area of IT procurement, it was clear that there was also a fairly significant gap between the Bureau s emerging needs and the staff s existing skill set. Many of our staff had been with the Bureau for years (or even decades) and had not received the ongoing technical and legal training necessary to successfully meet our current and upcoming procurement needs. The rapid growth of procurement operations without an equivalent growth in staff resulted in a scarcity of resources that proved to be an equally daunting problem. In 2000, our department managed $1.5 billion in purchases with roughly 70 full-time contracting officers. Over the next decade, the Bureau experienced 130-percent growth in purchase requirements while growing our contracting officer staff by only 14 percent. Our legal staff was similarly overextended. Our legal team consisted of just five full-time attorneys managing hundreds of individual contracts. There was no way for them to handle the volume or speed of contracts moving through the system. Scaling the Learning Curve To help our employees acquire the skill set and knowledge necessary to meet the Bureau s needs, we brought in subject matter experts from the National Academy of Public Administration, a not-for-profit government contractor, and from MITRE, a federally funded research and development center that has experienced procurement staff and extensive knowledge in advanced procurements. The subject matter experts provided technical expertise as well as general acquisition support and training. In utilizing these contractor resources, we made a conscious decision to avoid focusing solely on traditional top-down training programs with senior contracting officers. Too often, traditional training programs are like a waterfall crashing on the rocks: it appears to be a tremendous volume of change, but when the water stops, the rocks look 28 Contract Management June 2011

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7 Reinventing the G-Man: Bringing Change to FBI Procurement exactly the same. That s why we crafted a comprehensive approach to bringing new processes into the office. We imbedded subject matter experts into our contract teams and incorporated their technical knowledge, creative ingenuity, and experienced skill sets to improve contracting methods, cost estimates, solicitations, and other key aspects of the procurement process. Working cooperatively with contractor staff and attorneys, we have been able to give many of our new contracting officers the hands-on training and advanced skills they need through a collaborative, problem-solving environment. We also recruited recent graduates with degrees in finance and law and immersed them in an intensive, in-depth formal training program. Each new employee became a member of the team and partnered with an experienced subject matter expert as a mentor. They worked together on incoming requirements, along with the internal customer and the senior contracting officer, who also benefited from the insight of the contractor experts on the project. Rather than commodity buys, which most junior contracting officers can manage on their own, the mentoring program focuses on more advanced IT and service needs, where the team s insights could result in real improvements to our processes. In particular, we asked each team to reduce costs and improve efficiencies through the use of new tools, better market research, and improvements to the statement of work. The contractor experts also served as on-site training coaches for the new employees in other areas of their jobs. Through this program, we have been able to give our new employees the benefit of experienced mentors while also introducing our more senior contracting officers to improved procurement processes. Although change often brings resistance, many of our employees who had the opportunity to work with contractor experts and the mentoring program loved the experience and have changed their own practices because of it. Expanding the Toolbox A significant part of raising the skill set of our employees has been to provide a better set of tools that enables them to do their jobs more effectively. The most important of these tools has resulted from a more aggressive shift at the Bureau to performancebased contracting, agency-wide acquisition methods, and use of the online reverse auction marketplace. Performance-Based Contracting In the past, there was significant internal resistance to performance-based contracting in the divisions because of the extra management that must be performed by Bureau employees in order to ensure effective contract performance. Often, those extra management responsibilities came as a surprise to the Bureau employees involved during the request for proposal process or even, in some cases, after the process was complete. We have learned to address this problem by giving our internal customers specific ad- 30 Contract Management June 2011

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9 Reinventing the G-Man: Bringing Change to FBI Procurement vance notice of the additional requirements of a performance-based contract. We let them know prior to the solicitation process that they will need additional staff to handle contract oversight and performance reviews and we educate them regarding the project requirements they will need to manage. Our team-based approach helps drive this process forward. Our procurement subject matter experts assist our program managers in developing requirements, and those parties work hand-in-hand with the contracting officers and our attorneys to develop quality solicitations. The result is a system in which our staff and other Bureau division employees receive ongoing practical training through immediate expert feedback on how to select and integrate the appropriate performance metrics directly into requests for proposals and then manage those metrics throughout the contracting process. While this program is still in its infancy, the feedback from the divisions that have participated in this effort has been overwhelmingly positive. Not only are we awarding more performance-based contracts, but also our internal customers are reporting higher satisfaction and better results from those awards. Agency-Wide Acquisitions Every now and then you find a gem of a contracting officer, and Barb Rogers is just that. For the past 10 months, Barb has worked tirelessly to gather requirements for the largest effort the Bureau has seen. In so doing, she has shared her ingenuity and technical expertise with several junior contracting officers, mentoring and molding their creative talents. In October 2010, Barb awarded the IT Triple S effort, a basic ordering agreement issued against General Services Administration Schedule 70. IT Triple S allows the Bureau to increase business opportunities within the small business community. Fifty-two percent of the prime contract awardees are small businesses, and all basic ordering agreement holders have 40-percent small business subcontracting goals for all awarded task orders. The Bureau required a contracting mechanism to obtain services and supplies in a timelier manner and at a better cost for the agency. By streamlining processes through template documents, enhanced competition, and pre-established milestones, we leveraged bulk commodity buying power and eliminated our dependency on large fee-for-use governmentwide acquisition contracts. Now, the Bureau and the taxpayer will receive more return on their investment, and customers will realize a more timely acquisition process. The Online Reverse Auction Marketplace Whereas effective performance-based contracting has helped us revamp our approach to service contracting, we have also made significant progress improving our commodity acquisition process. Using a commercially available online reverse auction marketplace, the Bureau has enabled our contracting officers to save money, improve their purchasing efficiencies, and increase the Bureau s small business utilization. Through the online marketplace, our contracting officers instantly expanded the community of sellers they solicit well beyond their existing rolodexes. With a single mouse click, they have instant access to 58,000 registered sales agents at 40,000 companies representing hundreds of industries across the United States, with more added every day. In a matter of minutes, our contracting officers can post their needs, including any special requirements, under the acquisition scenario of their choice. Registered sellers with profiles corresponding to the requirements and acquisition scenario are notified of the opportunity and compete in a real-time online reverse auction process to provide the product that best meets the buyers needs at the best value. Significantly, during fiscal year 2010, small businesses received 81 percent of all awards through the online marketplace and 76 percent of awarded dollars, or nearly $70 million. 1 The reverse auction tool streamlines many of our acquisition processes for those purchases including notification, solicitation, bid collection, documentation, and reporting and allows our acquisition staff to focus their efforts on more customerfocused contracting activities. Also important for the finance division is the fact that the tool captures the cost savings metrics resulting from the reverse auction bidding and represents a considerable piece of the Bureau s acquisition savings plan. Because the online marketplace has proven so effective for us, we are now expanding the program to our 56 field offices around the country. Many of those field offices tend to buy small items on an as-needed basis, which can be a recipe for high prices and inefficiency. By using the reverse auction marketplace, they have access to sellers willing to provide pricing for smaller buys that is typically better than negotiated prices on large volume purchases. With Risk Comes Reward Because change can be difficult, we have worked to find and implement ways to recognize and reward our employees for learning and adopting new processes. Cash awards, although fairly nominal in overall terms, are one way we are recognizing employees for outstanding effort. We now make spot awards of up to $500 to employees who improve the organization s efficiency or save the taxpayers money. Another popular award is paid time off. For instance, we now give two time-off awards as incentive for employees who save the most money using the online marketplace. One award goes to the employee who saved the most on IT purchases and a second award for savings on non-it purchases. Beyond those awards, we also name an employee of the month in recognition of individuals who have demonstrated extraordinary initiative and productivity while advancing the mission of Bureau procurement. From Hoover to Hovercraft: Reinventing FBI Procurement Across all of these change areas, we are guided by a single principle: our employees are our greatest asset, and we must give 32 Contract Management June 2011

10 Reinventing the G-Man: Bringing Change to FBI Procurement them the tools and education to help the Bureau improve its procurement processes. That is why we are working to strengthen our employees by the following methods: Partnering with outside experts, Establishing innovative mentoring programs for new employees, Moving to better processes like performance-based contracting, Using effective tools like online reverse auctions, and Creating incentive programs to reward excellence. We are also working to improve communication within the agency concerning upcoming procurement needs by requiring all 24 divisions to submit their spend plans twice a year, in the fall and spring. By getting a holistic view in advance of the Bureau s upcoming needs across all of the divisions, we can aggregate purchases, negotiate better terms, and provide better service to our clients. Equally important, performance for each division is judged according to those plans to ensure that budget needs are realistic and spending goals are realized. Working together, training our people, and using new methods and tools will ensure that the FBI of the 21st century is well equipped and well prepared to protect the American people for the next 100 years as courageously and effectively as it has for the past century. CM About the Author DEBORAH BRODERICK is the procurement section chief and chief procurement officer at the Federal Bureau of Investigation. Send comments about this article to cm@ncmahq.org. Endnotes 1. According to FedBid, Inc. Contract Management June