Sid Koslow Winner of the 2015 Glen A. Gilbert Memorial Award

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1 Fall 2015 VOLUME 57, NO. 3 Sid Koslow Winner of the 2015 Glen A. Gilbert Memorial Award Plus Big Data Flows Through NextGen Change is Tantalizingly Close for the FAA Coping with Adverse Winter Weather

2 ATCA s Interview with Jim Eck The Program Management Office s Vice President Discusses the FAA s Acquisition Management System ATCA recently held a member roundtable to discuss the Federal Aviation Administration (FAA) s current Acquisition Management System (AMS). Out of that meeting came questions for the Program Management Organization (PMO), the chief practitioner of the FAA s AMS. Jim Eck, vice president of the PMO, came back with the following answers. 1. For those who aren t aware, the history of the FAA s Acquisition Management System (AMS) goes back 20 years when Congress passed personnel and procurement reform. That reform was passed to create a more flexible procurement system that more quickly ushered in technology. Is that how you remember it and has it been successful? If so, can you give us some examples? Yes. Based on some significant acquisition failures, the FAA was designated High Risk by the Government Accountability Office (GAO) in In that same year, Congress enacted legislation that included provisions granting the FAA flexibility and authority for acquisition management that most other government agencies do not have. In 1996, the FAA implemented its new acquisition policy the AMS. So the need for a more flexible acquisition and procurement system was the driving force behind both the creation of AMS, and the larger acquisition reform we undertook to enact it. I believe both have served us well in the ensuing years. Of course, there were some early expectations that were not met, particularly among those who thought our reforms would provide instant results. Ultimately, while the policy came into being rather quickly, the effective practice and the organizational structure to implement it took us longer and are still evolving today. The most notable indicator of success was our ability to con- 52 Fall 2015

3 vince GAO to remove the agency from its high risk list in January This was the result of a host of changes adopted by the agency, including stronger investment analysis practices, new program management techniques, more comprehensive program metrics reporting, and strengthening oversight of acquisition practice and workforce development. All of this resulted in significant positive trends in program execution for on-time and on-budget performance against a stable set of requirements. 2. Can you outline the leadership hierarchy of the AMS process and do you believe it is functioning at its most effective? If changes could be made in that workflow, what would you suggest? Under the AMS, the Joint Resources Council (JRC) is the senior decision-making body, and it is supported by three executive-level governance bodies: the Acquisition Executive Board (AEB), the FAA Enterprise Architecture Board (FEAB), and the Capital Investment Team. The JRC is chaired by the FAA Federal Acquisition Executive, and is comprised of the most senior officials of each of the FAA Lines of Business and the acquisition community. The other boards are generally populated by director-level executives responsible for both oversight and practice of the policy. As the senior investment decision board, the JRC governs the full acquisition life cycle, including approving the enterprise architecture, approving the FAA investment portfolio each year as part of the budget submission process, making investment decisions on programs and assigning execution of the program to a service organization, approving required AMS program documents, and making investment program in-service decisions, or assigning approval authority to the appropriate senior management. The AEB assists and supports the Acquisition Executive and JRC by overseeing the development and implementation of The Journal of Air Traffic Control 53

4 acquisition management policy, processes, and practices. It establishes direction and governance that acquisition programs use to manage and all other boards and decision-makers use to understand and adjudicate programs throughout the AMS lifecycle. The CIT provides independent assessments of facilities and equipment (F&E) capital projects, including the business justification, budget affordability, and priority of investment initiatives to the JRC before investment decisions. The FEAB governs the development and maintenance of the enterprise architecture, ensuring it aligns with the agency vision for NextGen. It also assures that the FAA adheres to federal statutory and regulatory requirements regarding enterprise architecture. Finally, it reconciles the architecture with realities of the budget as reflected in the JRC decisions to change investment strategies, and delay, modify, or cancel planned investments. From the perspective of the primary practitioner of the AMS process, I believe that by and large, the structure works effectively. While there are some inefficiencies in the system, the PMO has a seat on every governance board and therefore has the opportunity to champion process improvements we feel would best serve program execution. I think we have struck the right balance between execution and oversight, but this is an ongoing process. 3. Improving communication between the FAA and the stakeholders when it comes to the procurement process was something our members felt could be improved. Can you explain the instances in which the FAA can communicate about a pending procurement, what restrictions are in place, and any ways communication can be improved? A general rule of thumb is that when we are communicating the same information to all bidders, the government can communicate at any time in the process right up to award. One-to-one communications, on the other hand, have varying rules, but generally, the earlier in the process, the more we should engage in two-way communications to ensure industry understanding of our needs and constraints. Early in the process is the best time for industry to challenge us on both fronts, that is, if either a requirement or a stated constraint seems to be overly limiting, at a minimum we should ensure and state clearly that we understand that we have placed a limit on the specific acquisition. As we get closer to releasing the final Screening Information Request (SIR), one-to-one communications generally become less frequent because the government wants to maximize effective and timely competition. In that respect, one-to-one communications become much more of a balancing act between bringing greater clarity and innovative competition on one hand, and slowing down the process on the other, which may require bidders to hold teams together longer than desired. My sense is the community would like to see us find more efficient means in this process, allowing higher quality and more frequent communications without increasing time to award. I think this is one of the key issues in a dialog between government and industry on the AMS process and I look forward to such input. 4. Contract Officers (COs) and Program Managers (PMs) are currently in separate offices, answering to separate bosses but they each create a team responsible for managing the same contract. Our members believe this separation in management may mean that incentives to keep the procurement process moving forward are disjointed. Can you comment on ways in which COs and PMs can work together to meet AMS and procurement deadlines? Although COs and PMs are in different organizations, with respect to most acquisitions in the PMO, the COs are embedded with the program teams. Occasionally, the CO and the PM may disagree on an execution plan, but there is significant opportunity to review these issues at higher management levels in both organizations. Seldom have I seen such actions result in a timeliness issue for an award. The unfortunate truth is that time to award is dominated by budgetary constraints. Based on the larger government budget formulation process, getting into the capital budget is a two-year process. Beyond this, a lack of clarity around the larger out year budget often means that program teams must pause while they await adjudication from the JRC about what to assume for the budget outlook on their specific program. This usually requires that teams still in the investment analysis and source selection process go back to industry looking for tradeoffs and alternative implementation strategies related to affordability. This often strains an already difficult communication environment, as we try to move forward with a given acquisition. Again, I believe we can be better at explaining such circumstances as they arise. As to whether we can jointly benefit, I think that is another area of discussion I d very much like to hear about from industry. 5. The AMS supports creative contract vehicles. Would you consider the ADS-B and SE2020 contracts to be examples of a flexible procurement process? If so, what happened to SE2020 and why has the FAA not used that vehicle aside from budgetary restrictions? Rather than single out specific contracts, let me say that the contract structures under AMS have generally been creative, including sev- 54 Fall 2015

5 As we get closer to releasing the final Screening Information Request (SIR), one-to-one communications generally become less frequent because the government wants to maximize effective and timely competition. eral where we have been criticized for poor performance. In other words, the contract structure is not typically the first line of failure on a program or activity. Often the contract is simply a reflection of the many assumptions about scope, usage, governance, and other factors surrounding the program or activity that the contract was intended to serve. 6. Our members feel the COs need more support, including better training in the AMS (not in the FAR) and that with better training, the COs could be more responsive, open to creative solutions, and better equipped to use the flexibility provided in the AMS. Do you agree, and if so, how can this be achieved? Although I generally agree more training in AMS is good, this should not come at the expense of training in the FAR. While we are independent, we take a common where we can, different where we benefit approach to acquisitions. There are two reasons for this. First, the pool of talented COs across government is limited, and it would be further so for the FAA if we were to simply ignore the FAR. Second, broad-based training leading to certifications and warrants is a fairly expensive proposition, so we leverage much of what DoD and the Federal Acquisition Institute have to offer in contracts management across government. To this baseline knowledge, we add AMS and we are looking at better ways to differentiate both the policy, and more importantly, the acquisition practice in the FAA. While the above is not ideal for creating a strong culture solely focused on AMS, I believe that better, more creative practice is a function of better leadership trying creative things means taking risks. This in turn means developing trust within teams that educated risk-taking will be supported and rewarded. To this end, FAA leadership both in the acquisition and contracts organization, and in the program management organization, are dedicated to the workforce development that is critical to seeing new ways of doing business, and to allowing teams the flexibility to pursue those ends. 7. You have stated before that you are concerned the AMS process perhaps does not encourage creative solutions to air traffic problems; specifically, that if the FAA requests a solution to a problem, and includes expected performance requirements, a contractor with a significantly different way to provide the service would be unable to bid. Can you expand on that thought so our members can think of innovative ways to improve the process? I am often asked by industry how they might provide solutions for a completely different structure than envisioned by an acquisition team. Generally, these creative solutions offer high potential for cost and/or schedule reduction against a set of requirements. Given that the AMS, like the FAR, is designed to provide a competitive environment leading to best value for the government, there needs to be agreed upon baselines against which any proposal can be evaluated. The AMS does provide for much greater dialog with industry during the acquisition process, and we need to work through several risks to ensure that creativity can be encouraged, while maintaining competition. To that end, I see four major risks to adopting creative solutions in the way we currently evaluate our acquisitions: a) the risk that the proposal recommends or requires the FAA program team to reduce or eliminate some aspect of oversight not directly under its control such as safety regulations, security or maintenance certification; b) the risk that the proposed approach, while creative, may be untested in certain performance dimensions that are required, hence the government doesn t know how to value some portion of the benefit; c) the risk that the proposed approach has no equivalent from a costing perspective, hence the government has no baseline for cost comparison; and d) the risk that even if a given acquisition team works through the first three risks, the overall process may be challenged by a competitor who fulfilled all of the government needs with a more standard and measurable approach. In general, the earlier in the process such proposals can be discussed with industry the better chance the acquisition team has to respond. So at a minimum, the challenge is to design into the process, the opportunity to quickly evaluate creative alternatives, and notify the bidder as to the potential downsides to an approach. As I mentioned earlier, if done incorrectly, this can take time and resources that neither side can afford. Alternatively, if we can create a section of the proposal that allows for creative variants to the baseline, and we can agree to an upfront evaluation process, we may serve ourselves well in acquisitions that lend themselves to this approach. 8. As an association with industry members who are active in the AMS process and hold a vested interest in its improvement, how can we help you? I think the acquisition process, and specifically the contract management process that evolves from it, need to be thought of more as partnerships, especially for our more complex programs. While much of what goes on during a selection process is acquisition sensitive, and deservedly formalized, the end game is to select a trusted partner who has demonstrated the full range of understanding about how we do business in the NAS, and how we want that business to evolve over time with the new contract. A continuing dialog between the FAA and your industry members about the health of the process would be of great value to those of us who use AMS for creating best value solutions for aviation. Pakhnyushchy/Shutterstock.com The Journal of Air Traffic Control 55