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Special Publication:

United States Government Accountability Office:


October 2006:

Highlights of a GAO forum:

Federal Acquisition Challenges and Opportunities in the 21st Century:

Federal Acquisition Forum:


GAO Highlights:

Highlights of GAO-07-45SP, a GAO forum.

Why GAO Convened This Forum:

Acquisition of products and services from contractors consumes about a 
quarter of discretionary spending governmentwide and is a key function 
in many federal agencies. In fiscal year 2005 alone, federal government 
contracting involved over $388 billion. The work of the government is 
increasingly being performed by contractors, including in emergency and 
large-scale logistics operations such as hurricane response and 
recovery and the war in Iraq. Many agencies rely extensively on 
contractors to carry out their basic missions. 

The magnitude of the government’s spending and dependence on 
contractors make it imperative that this function be performed as 
efficiently and effectively as possible. Yet, acquisition issues are 
heavily represented on GAO’s list of government high-risk areas. In the 
21st century, the government needs to reexamine and evaluate its 
strategic and tactical approaches to acquisition. 

To identify and discuss the key issues confronting the federal 
acquisition community, the Comptroller General hosted a forum in July 
2006 that brought together acquisition experts from inside and outside 
the government. Participants shared their insights on challenges and 
opportunities for improving federal acquisition in an environment of 
increasing reliance on contractors and severe fiscal constraint.

What Participants Said:

Forum participants offered a range of examples, insights, views, and 
concerns that framed three broad challenges confronting the federal 
acquisition community:

* Determining who should perform the business of government in a 
constantly changing environment. Participants engaged in a wide-ranging 
discussion of the appropriate role of contractors, the difficulties of 
identifying what government functions may be contracted out, and the 
formal and informal means by which these decisions are made. Several 
participants contrasted the high-level attention given in private 
sector organizations to identify their core versus noncore functions.
* Ensuring the federal workforce has the capacity and capability to 
manage contractor operations effectively. Participants highlighted that 
policy makers do not have a clear understanding of what constitutes the 
acquisition workforce. Agency leaders have not recognized or elevated 
the importance of the acquisition profession within their 
organizations. Further, a strategic approach has not been taken across 
government or within agencies to focus on workforce challenges, such as 
creating a positive image essential to successfully recruit and retain 
a new generation of talented acquisition professionals. 
* Managing for results and accountability in a contractor-dependent 
environment. Participants noted the importance of early identification 
of realistic requirements, a step that can decrease the government’s 
risk of achieving undesirable outcomes. Participants cited the frequent 
mismatch among wants, needs, affordability, and sustainability, as well 
as unrealistic and often changing requirements. Further, participants 
highlighted the challenges when managing amidst burdensome governmental 
acquisition processes and budget pressures. In addressing the question 
of accountability, many participants commented that achieving 
successful outcomes is a shared responsibility. In some cases, 
contractors promise more than they can deliver, while in other cases, 
the government is at least partially at fault for not setting clear 
direction for contractor performance.

Participants also discussed opportunities for how the federal 
government can adopt more strategic, modern acquisition practices in 

* Identifying best practices and innovative approaches. Participants 
cited acquisition best practices that might be implemented more widely 
throughout all levels of government. Examples were provided that 
included best practices from within the federal government, foreign 
governments, and the commercial sector.
* Creating a culture for sharing knowledge and improving federal 
acquisition. Participants provided insights and examples as to why it 
is important for government leaders to create an organizational culture 
that will support ongoing improvement in acquisition practices in the 
21st century.

What GAO Recommends:

[Hyperlink,]. To view the 
full product, including the scope and methodology, click on the link 
above. For more information, contact Katherine Schinasi at (202) 512-
4841 or



Introduction from the Comptroller General of the United States:


Section 1Key Acquisition Challenges Facing Government as Reliance on 
Contractors Increases:

Determining Who Should Perform the Business of Government in a 
Constantly Changing Environment:

Ensuring the Federal Workforce Has the Capacity and Capability to 
Manage Contracts Effectively:

Managing for Results and Accountability in a Contractor-Dependent 

Section 2Opportunities for Improving Federal Acquisition in the 21st 

Identifying Best Practices and Innovative Approaches:

Creating a Culture for Sharing Knowledge and Improving Federal 

Appendix I: Forum Participants:

Appendix II: Forum Agenda:

Appendix III: Questions Provided in Advance to Forum Participants:

Related GAO Products:


Figure 1: Federal Acquisition Spending and Workforce Trends, 2000-2004:


COR: contracting officer representative: 
DAU: Defense Acquisition University: 
DLA: Defense Logistics Agency: 
DOD: Department of Defense: 
DHS: Department of Homeland Security: 
FAIR: Federal Activities Inventory Reform: 
GSA: General Services Administration: 
LOGCAP: Logistics Civil Augmentation Program: 
MSPB: Merit Systems Protection Board: 
NASA: National Aeronautics and Space Administration: 
OFPP: Office of Federal Procurement Policy: 
OMB: Office of Management and Budget:

[End of section]

United States Government Accountability Office:

Washington, DC 20548:

Introduction from the Comptroller General of the United States:

Near-term and long-term deficits strain federal agencies' resources 
because of current deficits and the nation's large and growing fiscal 
imbalance. Addressing this imbalance constitutes a major 
transformational challenge in the 21st century. Yet, in many cases, the 
government is still conducting business in ways that are based on 
conditions and priorities that existed decades ago, using approaches 
that are not well suited to addressing the challenges of our time. To 
address these 21st century challenges, a fundamental reexamination, 
reprioritization, and reengineering of the base of federal spending and 
tax programs is needed--covering discretionary and mandatory programs 
as well as the revenue side of the budget.

Part of this reexamination includes a focus on various cross-cutting 
issues of governance, such as the federal government's approach to 
acquiring the goods and services necessary to implement agency 
missions. Acquisition of goods and services from contractors consumes 
over one-fourth of discretionary spending governmentwide and is a key 
function in many federal agencies. In 2005, federal agencies spent over 
$388 billion on such contracts. The work of the government is 
increasingly being performed by contractors, including in emergency and 
large-scale recovery and logistics operations such as the Katrina 
disaster and the war in Iraq. Many agencies, including the Department 
of Energy, the Centers for Medicare and Medicaid Services, and the 
National Aeronautics and Space Administration (NASA), rely extensively 
on contractors to carry out their basic missions. In any consideration 
of how to improve the government's approach to acquisition, attention 
should be given to what is working, what is not working, and the causes 
for either outcome.

To retain public confidence in the government's stewardship over 
taxpayer dollars, federal managers need to strengthen their ability to 
obtain reasonable prices, monitor contractors, and ensure high-quality 
performance and the timely delivery of goods and services. Federal 
managers must also strike the right balance between developing 
collaborative relationships and avoiding conflicts of interest. 
Further, government agencies can benefit from transforming and finding 
new ways of doing business that minimize acquisition costs while 
maintaining and even improving mission results through the performance 
of contractors. New models and processes may be needed to continuously 
examine what work should be conducted by contractors and what work 
should be retained within the federal government.

Recognizing that decision makers can benefit from a better 
understanding of the challenges and opportunities confronting the 
federal acquisition community, GAO convened a forum on July 18, 2006. 
The forum provided a venue for bringing together knowledgeable and 
recognized government management and acquisition experts from the 
private and public sectors and academia to share insights on the 
critical challenges and opportunities for improving government 
performance in an environment of increasing reliance on contractors and 
severe fiscal constraint. Participants included current and former 
government executives and acquisition leaders, procurement law and 
public administration experts, and government contractor 
representatives and consultants from industry. (See app. I for a list 
of forum participants and app. II for the forum's agenda.)

Our approach was to engage in a rich and substantive discussion, on a 
nonattribution basis, to obtain a range of views on key issues in 
federal acquisition today. (See app. III for the list of questions 
provided in advance to forum participants to help provoke thought on 
issues to bring forward for discussion.) The forum neither sought nor 
achieved consensus on the issues discussed.

This report highlights the discussion among forum participants, as well 
as their subsequent comments on a draft of this report. The highlights 
summarized in this report do not necessarily represent the views of any 
individual participant or the organizations that these participants 
represent, including GAO. The report leads with a brief background on 
the information presented by GAO to initiate the forum. Section 1 
summarizes the discussion on the key challenges the government must 
address in order to operate effectively within an environment of 
extensive and increasing reliance on contractors. Section 2 highlights 
opportunities for improving federal acquisition in the 21st century 
through more strategic, results-oriented, world-class, and ethical 
business processes and capabilities.

I would like to thank all of the participants for taking the time to 
share their knowledge, insights, and perspectives. We will use the 
knowledge gained from the forum in our work for Congress and the 
country. I look forward to working with the forum's participants on 
federal acquisition and other important issues of mutual interest and 
concern in the future. For more information about this report, please 
contact Katherine Schinasi, Managing Director, Acquisition and Sourcing 
Management, at 202-512-4841 or Contact points for 
our Offices of Congressional Relations and Public Affairs may be found 
on the last page of this report. This report was prepared under the 
direction of Bill Woods, Director, Acquisition and Sourcing Management. 
GAO staff who made key contributions to organizing the forum and to 
this report were Carolyn Kirby, Assistant Director; Matthew Ebert; Rosa 
Johnson; and Bob Swierczek.

[Signed by]:

David M. Walker: 
Comptroller General: 
of the United States:

October 6, 2006:


Comptroller General Walker provided opening comments that focused on 
the current fiscal and federal acquisition environments and the reasons 
for convening the forum. In essence, the impetus for GAO holding this 
forum is that the federal government cannot continue its current way of 
conducting business. The federal government finds itself on a burning 
platform for a variety of reasons, including:

* a large and persistent budget deficit making ever scarcer the dollars 
available for discretionary spending;

* rising public expectations for government results and enhanced 

* contentious, complex, and rapidly evolving national problems, such as 
the global war on terrorism, homeland security, and a myriad of 
domestic issues; and:

* a number of high-risk management areas in the government that have 
been present for many years.

These realities make a clear case for change. Accordingly, the federal 
government has a responsibility to reexamine its current policies and 
practices and then to develop and implement innovative approaches to 
conducting the business of government.[Footnote 1] One area that is in 
need of reexamination is federal acquisition.

In responding to national events following the September 11, 2001, 
terrorist attacks on the United States, there is no doubt that the 
impact on the federal acquisition community has been significant and 
the government's response has been to rely on more contractors for 
support and solutions. Since 2001, federal acquisition spending has 
increased over 65 percent to $388 billion in fiscal year 2005. As 
illustrated in figure 1, as federal procurement spending generally, and 
spending on services in particular, has increased, the acquisition 
workforce remained at essentially the same level. Many have raised 
concerns that the increased workload has stretched this workforce to 
its limit.

Figure 1: Federal Acquisition Spending and Workforce Trends, 2000-2004:

[See PDF for image]

Source: Spending: GAO analysis of federal procurement data system, 
actions equal to or greater than $25,000.
Workforce: GAO analysis of Office of Personnel Management data of 14 
acquisition-related job series. 

[End of figure]

There continue to be a number of other challenges associated with 
today's federal acquisition environment. One key challenge is 
generating positive acquisition results on time and within budget, a 
responsibility shared by contractors and agencies. Another is for 
agency leaders and decision makers to exercise greater fiscal 
discipline by distinguishing between what all too often seems to be 
desired wants instead of true mission-critical needs. There is the 
growing complexity of contracting for technically complex and 
sophisticated services, which presents even greater challenges in terms 
of setting appropriate requirements and effectively monitoring 
contractor performance.

In an attempt to improve federal acquisition, Congress has enacted a 
series of legislative reforms over the last decade, ranging from the 
Federal Acquisition Streamlining Act of 1994[Footnote 2] to the 
Services Acquisition Reform Act of 2003.[Footnote 3] While these acts 
were intended to streamline, simplify, and expedite acquisition 
processes; achieve economies and efficiencies; and leverage the 
government's buying power, there clearly remains room for further 
improvement, as demonstrated by many of the GAO high risk designations.

GAO's list of government high-risk areas includes contract management 
at the departments of Defense and Energy and at NASA, meaning that 
hundreds of billions of taxpayer dollars are vulnerable to waste and 
misuse.[Footnote 4] For the Department of Defense (DOD) and other major 
federal agencies, significant investments in contractor-reliant 
operations are also at high risk, ranging from information system 
modernization projects to Medicare and Medicaid administration to 
housing assistance programs. GAO has also identified interagency 
contracting as posing several risks because of the rapid growth of 
dollars involved combined with the limited expertise at some of the 
agencies using these contracts and recent problems related to their 

To reduce risk, the federal government needs to meet long-range 
challenges by not assuming that any entitlement, other mandatory 
spending, discretionary spending, or tax policy is off-limits. In the 
area of acquisition, improvements can be achieved through identifying, 
sharing, and implementing best practices. This will not only save 
money, but increase the competence of the government and the likelihood 
that agencies will achieve their mission goals and objectives. Further, 
it will improve service to the American public and will strengthen 
public confidence and trust in the performance and accountability of 
our national government.

[End of section]

Section 1: Key Acquisition Challenges Facing Government as Reliance on 
Contractors Increases:

Forum participants offered a range of insights, views, examples, and 
concerns that framed three broad challenges. These were (1) determining 
who should perform the business of government in a constantly changing 
environment, (2) ensuring the federal workforce has the capacity and 
capability to manage contractors effectively, and (3) managing for 
results and accountability in a contractor-dependent environment. 
Highlights of this session's discussion are summarized below.

Determining Who Should Perform the Business of Government in a 
Constantly Changing Environment:

In addressing who should do the government's business in a constantly 
changing environment, participants engaged in a wide-ranging discussion 
of the challenges associated with determining the appropriate role of 
contractors and identifying functions that should or should not be 
contracted out. They also debated the value and limitations of the 
formal competitive sourcing process. Others contrasted the high-level 
attention given and rigorous approach taken in private sector 
organizations to identify their core versus noncore functions.

Several participants felt the federal government is on the wrong track 
in maintaining a prescriptive list for guiding sourcing decisions, 
arguing, for example, that the entire process is flawed in defining 
what federal functions are inherently governmental and must never be 
contracted out.[Footnote 5] Developing a list of such functions is 
problematic, they said, because any definition of functions will change 
as technology and the marketplace evolve, every job description becomes 
a source of concern, and the situation leads to confusion about roles 
and responsibilities between the contractors and the government. 
Agencies should instead focus on determining the right mix of 
government-performed and contractor-performed work in particular 
settings, said another participant.

Some participants pointed out, however, that classifying federal jobs 
as either inherently governmental or commercial activities is not a bad 
idea. Every year agencies must review and classify their positions as 
part of their Federal Activities Inventory Reform Act of 1998 (FAIR 
Act) inventories, a practice they said offers sufficient 
flexibility.[Footnote 6] At the agency level, developing lists of 
inherently governmental and commercial jobs forces agencies to think 
more strategically about contracting out their work, said another. In 
developing the lists, it might be easier and more appropriate for 
agencies to determine what should not be contracted out and develop 
guiding principles or values to determine which positions could be 
contracted out, another participant observed.

A divide existed among participants over the value and limitations of 
competitive sourcing under Circular A-76 processes. On the one hand, 
some participants claimed federal competitive sourcing practices have a 
positive impact on government, because in most cases the process makes 
government employees think about ways to do business more efficiently. 
For example, one participant cited an example in which agency employees 
attempted to improve the quality of their work at lower costs, but 
management ignored them until the competitive sourcing process forced 
management to think more strategically about reorganizing for greater 

On the other hand, one participant cited inherent difficulties in 
competitive sourcing practices. The participant pointed out that many 
government blue collar jobs could be done by contractors, but federal 
employee unions have prevented the jobs from being contracted out 
because of concerns about the economic impact on their members. In 
contrast, for many white collar professional and managerial jobs that 
are not likely candidates for outsourcing, the government often is 
forced to contract out for those services because it may not offer 
competitive salaries.

Other participants noted that the extent of contracting out of 
government services because of competitive sourcing may be exaggerated. 
One participated noted that the A-76 program is intended to make the 
government more effective, not downsize the government workforce or 
steer business toward the private sector. "Half of the government 
workforce is performing work determined to be inherently governmental 
and another fourth is performing commercial work that will not be 
outsourced for policy reasons. Thus, three-fourths of the workforce is 
not competed," the participant said. "That is the very reason the 
outsourcing issue should not get so much attention," argued another 
participant, explaining that "the debate over A-76 and competitive 
sourcing is a huge distraction in tackling federal acquisition 
challenges and is irrelevant at the macro level across agencies. 
Competitive sourcing represents less than 2 percent of service 
contracting governmentwide in terms of numbers of sourcing decisions 
and contract dollar value." One participant commented that the massive 
growth of service contracts over the last decade has come from new 
agency requirements, not from competitive sourcing under the A-76 
program. He added that the government would be better off figuring out 
how to manage those contracts instead of the A-76 program.

Finally, participants pointed to private sector outsourcing efforts as 
a model for changing the federal approach. Many corporate organizations 
carefully deliberate up-front and at the highest levels of management 
about what core functions they need to retain and noncore functions 
they should buy and the skill sets needed to process the acquisition of 
such noncore functions, said participants. Some participants indicated 
that while the government is unlikely to be able to follow the private 
sector's processes completely, there are aspects it should adopt, such 
as up-front identification of requirements, determining needed residual 
skill sets, and ensuring oversight of performance under the contract 
once it is put in place.

Ensuring the Federal Workforce Has the Capacity and Capability to 
Manage Contracts Effectively:

Ensuring the federal workforce has the capacity and capability to 
manage contractor-reliant operations effectively is a critical 
challenge, according to participants. Agency leaders have not 
recognized or elevated the importance of the acquisition profession 
within their organizations, and a strategic approach has not been taken 
across government or within agencies to focus on workforce challenges, 
such as creating a positive image essential to successfully recruit and 
retain a new generation of talented acquisition professionals.

Addressing Acquisition Workforce Capacity:

Many participants noted that to assess the appropriate size and skill 
sets needed, one needs to have a working knowledge of the government's 
current acquisition workforce. Agency managers do not clearly 
understand what constitutes the acquisition workforce, a fact that 
itself presents a major human capital challenge for the agencies and 
policy makers. One participant said that the government should define 
the acquisition workforce as including any managers and employees 
involved in the acquisition process, such as a contracting officer 
representative (COR),[Footnote 7] program manager, legal adviser, or 
contracting officer. Another participant agreed and stated that often 
CORs are not included in the definition of acquisition workforce and 
contended that the profile of this position needs to be elevated. It 
will be hard to change how people think about what constitutes the 
acquisition workforce, the participant acknowledged.

One participant--citing a recent Inspector General report that 
highlighted the two competing methodologies used for counting the 
acquisition workforce--contended that it was a counting 
problem.[Footnote 8] According to the participant, empirical studies 
about organizations' procurement functions have found a direct 
correlation between the number of staff assigned to that function and 
its effectiveness. Further, many agency procurement staff have been 
given waivers to the various qualification requirements contained in 
the Clinger-Cohen Act of 1996 and the Defense Acquisition Workforce 
Improvement Act; thus the government needs data about the quantity and 
validity of waivers granted.[Footnote 9] One participant also commented 
that the plethora of qualification waivers such as granted under the 
Clinger-Cohen Act of 1996 is particularly troubling given the extent to 
which the procurement function has evolved from the administrative 
support role of the past to today's valuable business adviser role.

While there was not agreement on the appropriate size of the 
acquisition workforce, it was evident that participants agreed that 
employees who are more skilled need to be added to the acquisition 
workforce. Several highlighted the need for more skilled acquisition 
employees because of the new environment in which there is a heavy 
reliance on contractors to perform functions previously performed by 
the government. Several participants highlighted that the size and 
skill sets of the acquisition workforce should be derived agency by 
agency and done so comprehensively. For example, one participant said 
it does not matter how many people are performing a function until the 
government defines the roles and responsibilities associated with that 
agency's mission and respective acquisition workforce. The participant 
continued by saying, "You can have two times or five times the number 
of people, but if you have not defined what they are supposed to do, 
then size alone does not get it done. Clarity of purpose is key." 
Another participant said the size of the workforce needed depends on 
the nature of the work, processes, and technical ability.

One participant stated that government agencies need to determine 
whether their acquisition workforce will use a transactional or 
strategic approach. There may be instances where both approaches are 
helpful to an agency, but essentially the two approaches to acquisition 
management demand different skills. The participant said that agencies 
need to determine whether to manage acquisition either as a strategic 
supply management function or as a transactional, tactical, 
administrative support function, and then shape staffing and salary 
requirements accordingly.

One participant noted that when the United States Postal Service 
decided to adopt commercial best practices for a strategic, enterprise 
supply management approach, it completely overhauled and upgraded the 
skill sets in its acquisition workforce. The participant said to 
upgrade the workforce, the Postal Service surveyed the workforce's 
existing skills, benchmarked them against the private sector, and 
conducted a competency assessment. The supply management organization 
then went through a difficult reduction in force, followed by an 
intense effort to hire new talent under dramatically revamped 
competencies and skill sets. According to the participant, today's 
Postal Service acquisition workforce feels highly valued and rewarded 
in terms of making a difference in the organization.

Other participants echoed that different skill sets are needed in 
today's new acquisition environment, many participants stressed, 
although those will vary from workforce to workforce. One might 
consider, for example, a workforce that focuses on acquiring complex 
services such as information technology and telecommunications, 
contrasted with another that focuses on the challenging and highly 
specialized acquisition of weapon systems. Another participant stated 
that the workforce should not focus solely on acquisition or 
contracting expertise, but on programmatic experience and expertise to 
help make better acquisition decisions. Finally, one participant 
questioned whether the Office of Management and Budget's (OMB) Office 
of Federal Procurement Policy (OFPP), the organization responsible for 
implementation of key acquisition reforms, has enough staff to 
accomplish its tall order of leading change in this area.[Footnote 10]

Recruiting and Retaining New Talent:

Many participants emphasized the importance of recruiting skilled 
acquisition workers and the associated challenges in today's 
environment. The federal government's negative image was identified as 
a major cause of recruitment distress, derived from unclear terminology 
in job descriptions, the lack of value placed on the acquisition 
workforce by agency leadership, and the negative reports in the press.

One participant highlighted bureaucracy as creating a key image problem 
for federal efforts to recruit skilled young acquisition workers. 
Citing results from a recent survey of college students by the 
Partnership for Public Service,[Footnote 11] the notion that there is 
too much bureaucracy hampering employees working in the government is 
the number one reason young people do not seek federal jobs. "We're not 
emphasizing that work in government offers many management tracks as 
well as many career paths that involve technically skilled and focused 
jobs," said the participant.

Another participant stated that the government advertises jobs using 
descriptors such as "procurement"--when young prospective hires have no 
idea what "procurement" means--rather than using more understandable 
terminology such as "purchasing." Another participant echoed these 
remarks, saying that the difference of terminology between the private 
sector and the government sector is dampening interest of college 
graduates in government careers. "Until the government changes its 
terminology, it will have difficulties recruiting personnel for 
acquisition functions," said the participant.Further, terms such as 
"acquisition," "contracting," and "procurement" are misnomers for what 
the government is actually doing. Such terms have typically been 
interpreted by recruits as low-level functions for buying supplies, 
goods, and equipment rather than as higher-level management positions 
to engage service providers.

Another participant highlighted the need for the federal government to 
raise the profile, importance, and skills involved in the hiring and 
assignment of CORs responsible for providing technical expertise and 
oversight of contractors. Many of the people serving as CORs were hired 
by the government as scientists, logisticians and engineers, but are 
now being asked to manage contractors, explained the participant. Too 
often CORs do not see this role and responsibility as the job they were 
hired to do, instead viewing it as a collateral duty or even worse. "It 
is not as valued inside their organizations, and thus not seen as a 
desirable role for federal managers to take on. Government has not put 
a premium on this job," stressed the participant.

Other participants agreed that procurement officials have a different 
image in the federal government versus the private sector. According to 
one participant, in the past, many jobs at companies involved in 
purchasing and procurement were not seen as being for important or high-
valued employees but rather for lower-level administrative and back 
office support personnel. Unlike the government, however, many 
companies have recognized the bottom-line importance of the acquisition 
function, essentially transforming and adopting a supply management 
focus and putting in those positions top managers and highly paid 
professional staff. The private sector treats procurement of services 
as essential to company success, and thus considers those responsible 
for that procurement as occupying very strategic, high-value positions 
in the company.

Harshly critical oversight and bad press have also had an undesirable 
effect, said many participants. One asked why a young person would go 
into contracting, given how the government's contracting function is 
portrayed in the press. The participant said that publicity, created in 
part by the "gotcha" approach of some in the auditing community, turns 
off potential new hires and hurts the existing workforce, causing 
federal employee attrition. It would help if the inspectors generals 
and the auditors toned down their criticism of federal contracting 
employees, said the participant. Another participant said that auditors 
exacerbate the problem with their reporting of past problems. "There 
needs to be a more balanced approach to show where the acquisition 
community performs well," the participant said, "with positive 
recognition of federal acquisition management to encourage high-quality 
people to apply and stay at work in the federal government." "While the 
federal government can't compete in hiring with the private sector 
based on salary, it can compete well based on offering a public service 
career that makes a difference," said another participant.

Retention is as important as recruiting, said a participant, and must 
involve well-thought-out career paths. While some new hires are looking 
for short-term gains and quick advancement, incentives in the 
government tend to be based on long-term results. In comparison to 
those in the private sector, government program managers in long-term 
programs typically rotate every 2 years and frequently do not have time 
to develop expertise before the end of the tour. The participant 
suggested that the government develop a new cadre of experienced people 
who are motivated to have long careers in the federal government.

Several participants mentioned that the way to retain staff is to 
provide a market-based compensation plan for acquisition workers, 
recognizing that in the long run, the government may need fewer people, 
but people with market-based knowledge, skills, and salaries. To 
motivate employees in a performance management system, the government 
needs to figure out how to become more skills-oriented and competitive 
in compensation, said another participant. "To be sure, there are 
challenges associated with developing such a system," one participant 
noted. "Unfortunately, there are no current benchmarks--baseline data-
-on job responsibility and pay scales across the government to support 
well-supported judgments on how to revamp pay or position descriptions 
in the acquisition workforce," said the participant, who also warned 
against too heavily focusing on incentives for employees. Monetary 
incentives for government employees quickly become regarded as 
entitlements by the workforce, whether or not they are earned.

Managing for Results and Accountability in a Contractor-Dependent 

Increasing reliance on contractors to conduct the business of 
government involves many challenges for the government. These include 
the early identification of realistic requirements and desired 
outcomes, accountability for achieving results while contending with 
the sometimes burdensome governmental acquisition processes, persistent 
budget pressures, and the recognition that contractor accountability in 
large part depends on clear direction set by government.

Up-front Planning of Requirements:

Many participants said strategic planning for contracting outcomes and 
measurable results was a critical element in managing a multisector 
workforce of government employees and contractors. "In the absence of 
such a focus," said one participant, "there is not enough clarity for 
the government employees and contractors about what the government is 
trying to achieve." "Federal employees are unable to articulate what 
they are accountable for achieving because their evaluations are not 
tied to achievements," the participant added. Further, the participant 
stated that when OMB began evaluating the performance of federal 
programs in 2001, it found that the agencies could not explain what 
half of the programs were intended to achieve.[Footnote 12] Another 
agreed, stressing that the government as a whole lacks outcome-based 
indicators of performance and focuses on process and spending and not 
on desired outcomes. "Following processes by dotting the i's and 
crossing the t's to avoid risk does not guarantee that the desired 
result will be achieved," said the participant.

The early identification of requirements for an acquisition was 
highlighted by many participants as another challenge facing the 
government. One participant said that clarity of purpose is never 
obtained when the government acquires a product or service and does not 
adequately define up-front what it wants. According to another 
participant, there is a fundamental mismatch among government wants, 
needs, affordability, and sustainability. Further, if requirements keep 
changing throughout the life of an acquisition, huge problems persist. 
Another participant agreed and stated that with enough time and money, 
the government can do anything, but that does not mean it should. 
Metrics and milestones are critical for establishing a disciplined 
approach to acquisition, said a participant.

In addition, many participants felt that before contractors can be held 
accountable for delivering results, federal managers must be 
accountable and transparent in the acquisition process. For example, 
one participant contended that long-term thinking is important, but the 
government also needs to be tactical and driven to accountability and 
consequences for not performing on individual acquisitions. He said 
quarterly or monthly reviews can help create that accountability. 
Another participant agreed by saying that the government needs to hold 
individuals accountable for results.

"While planning strategically by identifying outcomes and defining 
requirements up-front is a challenge for the government, the private 
sector has been able to accomplish it," said one participant. According 
to the participant, before seeking offers from prospective suppliers, 
leading private sector companies first define their requirements 
through careful planning and obtaining the buy-in of senior corporate 
leaders. The participant noted that companies' procurement executives 
place considerable emphasis on the benefits of extensive up-front 
internal consultation and analysis with the company's business and 
operational stakeholders in deciding what requirements are to be 
contracted. As a general rule, they also seek healthy competition in 
the supplier market in order to promote finding the best solution from 
vendors. Leading commercial companies are willing to make this kind of 
investment in the acquisition process in order to arrive at the best 
outcomes. "It all starts by knowing what you want, but the federal 
procurement process creates disconnects and shortcuts that discourage 
effective management practices," said the participant.

Coping with Inefficient Governmental Processes:

Many participants agreed that there are aspects of the federal 
acquisition process that could be streamlined. One claimed that part of 
the strategic planning process should identify and use practices that 
result in effective acquisition outcomes, such as timeliness. Another 
participant recapped the criticisms of federal acquisition management 
raised by forum participants--such as lengthy acquisition cycle times 
and duplicative processes--and contrasted the government's acquisition 
performance with private sector's supply management and procurement 

The participant noted that private sector companies have a clear focus 
on strategically managing their supplier bases for competitive 
advantage. Public policy, however, shapes federal procurement and 
acquisition processes to promote sometimes conflicting objectives that 
undermine strategic procurement and supply management effectiveness, 
such as unbundling large contract requirements to support small 
businesses. He commented that these public policy requirements impose 
costs such as longer cycle times, the need for more people, more 
administrative process, and a less clear focus on business objectives 
than in the private sector.

Another participant added that there are simply too many layers of 
bureaucracy in the acquisition process and not enough focus on results. 
There is also a need to look at using technology or electronic 
procurement and commerce tools to streamline and automate acquisition 
business processes, which in turn will also influence the types of 
skills the acquisition workforce will need in the future.

Finally, several participants highlighted the budget process and 
pressures as a challenge in federal acquisition. Often, Congress does 
not complete the budget on time and uses continuing resolutions to fund 
government activities, said one participant. This leads to poor 
outcomes, management inefficiencies, and wasted taxpayer dollars. For 
example, agencies are unable to finalize or renew contracts in a timely 
manner. The federal budget is fundamental to management, the 
participant noted. Companies do not manage their finances this way and 
neither should the government. Further, another participant noted that 
managers do not want to save money in the contracting process because 
Congress will cut the agency's future budget. The chronically late 
federal budget and appropriations process promotes the pervasive "spend 
the budget" mentality, actually creating incentives for waste and 
inefficiency in contract management. Another participant noted there is 
also an impact on the contractor when a budget is not in place, such as 
spending money negotiating "bridge contracts," which increase the 
contractors' costs.

[End of section]

Section 2: Opportunities for Improving Federal Acquisition in the 21st 

Participants offered up a range of examples, ideas, and viewpoints that 
identified opportunities for improving federal acquisition. There was 
general agreement that improvement could be achieved through (1) 
identifying best practices and innovative approaches from the private 
sector, state, local, and federal governments, as well as from foreign 
governments, and (2) creating a culture for sharing knowledge and 
improving acquisition practices. Highlights of this discussion are 
summarized below.

Identifying Best Practices and Innovative Approaches:

Participants pointed to using best practices as a way to improve 
federal acquisition by adopting more strategic, results-oriented, and 
ethical business processes and capabilities. Participants suggested 
that the federal government incorporate, when appropriate, the many 
best practices of the commercial sector as well as from federal, state, 
local and foreign governments. Participants also cited examples where 
the federal government has had success in using contracting approaches 
that are working well.

One participant stated that opportunities for improving federal 
acquisition can come from using commercial best practices. "The 
government has adopted some commercial best practices at various 
points, but there are opportunities to learn about more. Most 
commercial best practices are permissible under current federal 
acquisition laws." The participant explained that commercial entities 
take a corporate approach to managing acquisition of services and 
invest a great deal in planning and clearly defining the requirements 
for a prospective contract. They are willing to invest in the time and 
effort up-front to do this right, even if it takes 6 months. According 
to the participant, one potential strategy for improving federal 
acquisition is to conduct periodic surveys of the private sector's best 
practices. "This would be far better than the current approach of 
defining commercial practice in law and regulation, because current 
federal law and regulation may not accurately reflect evolving 
commercial practices for acquisition," said the participant.

To improve the quality of service and acquisition management, 
participants pointed to a number of initiatives where the government 
created innovative contracting approaches that led to a successful 
outcome. In each of these examples, participants explained that 
government personnel were encouraged not only to follow federal 
acquisition regulations, but also to think of ways to increase the 
value that the government gets out of it contracts. Each of the 
examples was performed without the benefit of special legislation and 
was the result of initiative and good management:

* The United States Postal Service, facing a dire financial position, 
made a decision to adopt commercial best practices for supply 
management. The Postal Service has come a long way with its supply 
management transformation, but that change process was a long-term 
effort and is still a work in progress.

* The Department of Homeland Security's (DHS) strategic sourcing of 
pistols was highlighted as a success.[Footnote 13] By applying 
strategic sourcing methods modeled after commercial best practices, DHS 
was able to leverage its buying power in the procurement of weapons, 
reducing its decentralized purchasing of over 50 types of pistols from 
a large number of suppliers to a standardized choice of three to four 
types of pistols, under contracts with a few large and small businesses.

* The Defense Logistics Agency (DLA) in Philadelphia created agreements 
with one retail food corporation and its uniform supplier to stop 
production of employee uniforms and produce and supply DLA with 
military uniforms in case of a surge in DLA requirements.

* DOD created agreements with the General Services Administration (GSA) 
and commercial airlines to ensure the airlines will provide military 
airlift capacity during a national emergency.[Footnote 14]

* Before soliciting a new contract for veterans' home loan mortgage 
services, the Department of Veterans Affairs found that its current 
process for paying its contractor did not reflect commercial best 
practices, and contributed to higher government costs. As a result, the 
department offered an incentive to spur higher loan repayment 
performance, paying the new mortgage services contractor based on the 
percentage of veterans' home loan repayments, saving millions of 

* The Army's Communications Electronics Command, which buys night 
vision equipment for the military, made arrangements for its suppliers 
to buy back older and technically obsolete versions of night vision 
equipment from the Army's inventory because they realized that the 
suppliers would be able to get a better price on the commercial market.

* The Naval Sea Systems Command established an electronic marketplace 
under its Seaport initiative that uses a Web-based acquisition process 
which vastly expedites the competitive award of its contracts. The 
Seaport tool has greatly shortened the command's average time frame for 
awards, saving proposal and evaluation costs for both contractors and 
Navy officials. For example, a $150 million task order award, typically 
taking 6 to 12 months to be awarded, took 90 days under Seaport; 
another $32 million financial management contract was solicited and 
awarded in 30 days.

* The Army's Logistics Civil Augmentation program (LOGCAP) uses private 
contractors to provide logistics support in war and in other 
contingencies. One participant noted that in Iraq and elsewhere, LOGCAP 
currently provides critical services to the military more efficiently 
than if the services were to do the work themselves.[Footnote 15]

Participants also highlighted the value of looking to state, local, and 
international procurement communities for best practices. Several 
participants pointed to foreign examples that could serve as models for 
the federal competitive sourcing process, highlighting Australia, 
Britain, and the European Union, in particular. According to 

* Australia and Britain have advanced far beyond what the U.S. 
government is doing in procurement innovations. The United States 
should pursue more innovation in the outsourcing of work currently 
being performed by government employees, drawing on international 
public management approaches. These two countries have taken more 
thoughtful approaches to outsourcing government activities and are 
trying to manage by being very deliberative in studying what should and 
can be effectively outsourced.

* Britain's management of public-private partnerships is an example of 
an opportunity for improving acquisitions of key services by the United 
States. It took the British government over 10 years to build a good 
model for public-private partnerships between agencies and private 
contractors. Its 1990 reforms successfully began a private financing 
initiative that removed bureaucracy and increased speed in acquisition 
by developing models for risk sharing.

* Another model from Britain is its creation of a partnerships office 
as part of a broader effort to improve its public-private partnerships 
capacity.This government office helps agencies become smarter 
purchasers of services by standardizing contracts, providing help desk 
support, highlighting best practices, and rotating employees in and out 
of agencies for temporary assistance.

* There may be value in looking at the European Union's 
intergovernmental effort to develop a more unified and open market 
system of public procurement. The European Union developed minimum 
standardized requirements across a range of products and services and 
requires that member governments use these standards when contracting.

One participant noted that the Defense Acquisition University (DAU) 
participates in forums with allied countries, including Britain, 
Germany, and Australia, to share best practices. DAU describes other 
countries' acquisition systems on its Web site, and a report is 
compiled and updated continually to maintain accuracy of this knowledge-
sharing database. DAU also worked closely with the Australian 
government to help it establish a government managers training 
certification effort for construction program management that includes 
contracting elements.

In examining foreign procurement models, several participants noted 
differences in foreign political and acquisition processes should be 
taken into consideration as approaches are considered. One participant 
explained that some foreign governments, such as those of New Zealand, 
Australia, and Britain, are less relevant because they have very 
different political structures and bureaucracies. Other participants 
agreed that their practices may be beneficial, but one must always keep 
such political considerations in mind.

On the other hand, while several participants conceded that there is 
value in looking overseas for best practice models, they noted that 
other countries are actually looking to American government as a model 
for their acquisition management approach. The participant explained 
that our system places emphasis on best value, which is different from 
other international procurement systems. Further, another participant 
said, "the federal procurement system in the U.S. looks better and 
better once one starts looking closely at other systems."

Creating a Culture for Sharing Knowledge and Improving Federal 

In sharing knowledge about improving federal acquisition, participants 
provided insights and examples as to why it is so important to create 
an organizational culture that will support ongoing improvement in 
acquisition practices in the 21st century.

In order to create and implement innovative acquisition policies as 
well as to run an effective organization, well-trained, effective 
leaders are needed throughout an organization, according to several 
participants. "The government needs to raise the talent bar of agency 
management staff," said one participant. Several participants pointed 
to ways the government could improve its leadership and cited several 
worthy initiatives. "If the government wants to promote certain 
behaviors," the participant added, "it needs to stress their 
importance." The annual Service to America awards jointly sponsored by 
media and public affairs organizations, which recognize federal 
employees and managers for their truly heroic and laudable efforts on 
the job, is one worthwhile program that could be expanded into the 
acquisition arena.

Another initiative could be the introduction of the chief management or 
operating officer concept, said one participant. Further, other 
participants focused on the value of mixing government and private 
sector employees through executive exchange programs. According to one 
participant, the federal Senior Executive Service was envisioned to be 
a cadre of leaders who would rotate through various positions. The 
participant also cited DOD's Acquisition Demonstration Project as a 
successful program that is no longer in effect. "The government could 
do a better job of government and commercial exchanges that would allow 
the government to have a blend of new and seasoned workers," agreed 
another participant. According to the participant, programs like these 
could bring down the barriers that keep government and contractors from 
partnering and collaborating, reducing adversarial and distrustful 

Other participants stated that senior government officials, such as 
career senior executives and political appointees, need to be trained 
so they can effectively oversee agencies' acquisition performance. 
Several participants cited and others agreed that DAU is a good model 
for training military leaders in procurement. Also, one participant 
highlighted that the Department of Interior has similarly revamped its 
training for executives and political appointees in the procurement 
area. Agreeing, another participant highlighted the importance of 
developing leaders that have the ability to foster effective supplier 
relationships. According to the participant, supplier relationship 
management is how industry has learned to unlock additional value 
through collaboration with suppliers to achieve innovation and a 
competitive edge. He said the government needs to look at the supplier 
relationship management opportunity as a matter of joint success 
between an agency and its suppliers.

In terms of the federal government, one participant stated OFPP is 
theoretically the entity that should "lead by example" in sharing 
knowledge by identifying best practices. Another participant maintained 
that OFPP is in a position to share best practices and does so 
indirectly through forums and interagency working groups, such as its 
Chief Acquisition Officers Council. According to the participant, OFPP 
has established working groups on almost every one of the topics 
addressed in the forum. For example, one OFPP Web site, the Acquisition 
Center of Excellence for Services, provides examples of performance- 
based contracts intending to help agencies write better 
contracts.[Footnote 16] In contrast, another participant questioned 
whether OFPP had adequate numbers of staff and if it was equipped with 
the necessary strategic planning abilities.

Two other ways that best practices are shared that were highlighted 
included events such as this GAO forum and bodies of work that assess 
and highlight best practices. Several participants suggested that GAO 
issue more reports on best practices in this area.

[End of section]

Appendix I: Forum Participants:


David M. Walker: 
Comptroller General of the United States: 
U.S. Government Accountability Office:


Frank J. Anderson, Jr. 
Defense Acquisition University:

Robert A. Burton: 
Associate Administrator: 
Office of Federal Procurement Policy:

Alan Chvotkin: 
Senior Vice President and Counsel: 
Professional Services Council:

William D. Eggers: 
Global Director: 
Deloitte Research--Public Sector:

Mark W. Everson: 
Internal Revenue Service:

James I. Finley: 
Deputy Under Secretary of Defense, Acquisition, Technology and 
Department of Defense:

Daniel I. Gordon: 
Deputy General Counsel and Chief Ethics Counselor: 
U.S. Government Accountability Office:

Sallyanne Harper: 
Chief Administrative Officer: 
U.S. Government Accountability Office:

Clay Johnson III: 
Deputy Director for Management: 
Office of Management and Budget:

Ronald T. Kadish: 
Vice President and Partner, Aerospace Marketing: 
Group Booz-Allen Hamilton, Inc.

Steven Kelman: 
Weatherhead Professor of Public Management: 
Harvard University's John F. Kennedy School of Government:

Deidre A. Lee: 
Deputy Director of Operations: 
Federal Emergency Management Agency:

Harry Q. Lee: 
Corporate Director of Contracts: 
Northrop Grumman Corporation:

Bruce Leinster: 
Consultant to IBM:

Tom Luedtke: 
Assistant Administrator for Procurement: 
National Aeronautics and Space Administration:

Marcia G. Madsen: 
Partner Mayer, Brown, Rowe, & Maw, LLP:

Frank P. Pugliese, Jr. 
Managing Director, Government Solutions: 
DuPont Corporation:

Katherine Schinasi: 
Managing Director, Acquisition and Sourcing Management: 
U.S. Government Accountability Office:

Steven L. Schooner: 
Associate Professor of Law and Co-Director, Government Procurement Law 
George Washington University Law School:

Keith Strange: 
Associate Partner: 
IBM Business Consulting:

G. Martin Wagner: 
Acting Deputy Commissioner, Federal Acquisition Service: 
U.S. General Services Administration:

Bill Woods: 
Director, Acquisition and Sourcing Management: 
U.S. Government Accountability Office:

[End of section]

Appendix II: Forum Agenda:

8:30 a.m. Check-in/Continental Breakfast:

8:45 a.m. Welcome and Discussion of Current Acquisition Environment:  
David M. Walker, Comptroller General of the United States:

9:15 a.m. Key Challenges in a Contractor-Dependent Acquisition 

What are the key challenges the federal government must address in 
order to operate effectively within an environment of extensive and 
increasing reliance on contractors?

10:00 a.m. Break:

10:15 a.m. Continuation of Key Challenges Discussion:

11:30 a.m. Break:

11:45 a.m. Working Lunch:

Opportunities for Sharing Best Practices and Improving Federal 
Acquisition in the 21st Century:

How can the federal government adopt more strategic, results-oriented, 
world class, and ethical business processes and capabilities in federal 

1:00 p.m. Adjourn:

[End of section]

Appendix III: Questions Provided in Advance to Forum Participants:


Proposed questions to address include the following:

* What are the forces that have led the federal government to 
increasingly rely on contractors to perform certain functions? Are we 
locked into reacting to these forces? Are new criteria needed to better 
decide on a periodic basis what functions to turn over to the private 
sector and what to retain in-house to maintain expertise and direct 
responsibility? When the federal government chooses to outsource core 
functions, how does it consider contingency planning?

* How can we help federal managers recognize that involving "partners" 
(even profit-motivated contractors) to produce government services 
places more--not less--responsibility on them?

* How can the government clarify and make more transparent to the 
public the roles and shared responsibilities of federal employees and 
private contractors?

* If officials must be accountable to taxpayers for the basic work of 
government, what changes are needed in terms of transparency and 
accountability for work performed or assisted by contractors?

* How can the government balance the benefits and risks associated with 
increased reliance on the private sector as a provider of goods and 

* Where there are examples of government reliance on contractors, what 
are the key benefits realized (efficiencies, savings, quality) and 
lessons to be learned from such examples? Are there lessons to be 
learned from agencies such as IRS and DOD--which are in the process of 
outsourcing tax debt collection and military mail delivery--on the 
deliberative process for addressing the risks and benefits of 
subjecting long-held governmental functions to contractor competition 
and performance?

* Where problems have been identified, are the causes well understood? 
Do corrections need to be made in laws and regulations or in policies 
and practices?

* What are the workforce skills and abilities needed for agency 
acquisition and program managers to produce "public value" results or 
outcomes in programs that rely on the performance of contractors? How 
and when should tasks and functions be adjusted when skills are not 

* What tools and strategies are available to help agency managers gain 
awareness and be proactive regarding potential or actual organizational 
conflicts among contractors? What are the steps necessary in the 
acquisition process to prevent or mitigate personal and organizational 
conflicts of interest?

* What is the proper role of government regarding subcontracts and 
subcontractor management, and are further efforts needed to minimize 
pass-throughs and layering?


Proposed questions to address include the following:

* What is the potential for wider adoption of proven commercial best 
practices for acquisition management?

* As agencies deliberate business case decisions to acquire goods and 
services, is there adequate focus on needs versus wants?

* Of the strategic sourcing plans adopted by agencies, what are the 
options for organizational and business process changes to help 
institutionalize enterprisewide collaboration in buying processes, in 
terms of governance structure, goals and objectives, and performance 

* Are there examples of effective performance-based services 
contract[Footnote 17] work statements that describe desired outcomes in 
measurable terms as well as the method of assessing contractor 
performance against standards?

* Are new contract implementation strategies or agency organizational 
functions needed to effectively manage performance-based service 
contracts, particularly for more complex services?

* When are performance-based contracts not appropriate?

* How are financial and nonfinancial incentives being used to reward 
contractors for performance and results? In what ways do these measures 
ensure that performance-based incentive contracts are used to reward 
results rather than just effort?

* How will we know that progress is being made by agencies in making 
more cost-effective and strategic use of other agencies' contracts?

* Have the benefits of interagency and fee-for-service contracting 
among and between government agencies been realized?

* Should the government continue to do business with contractors who 
are delinquent on their federal taxes? Are suspension and debarment 
procedures effective?

* Is a more level playing field needed for contractor payments--should 
contractors owe the government interest on overpayments when the 
government now has to pay interest on late payments?

* Is there interest in establishing and promoting acquisition and 
managerial executive exchanges between the government and the private 
sector to gain and share expertise, knowledge, and experiences between 
sectors as a way to improve the acquisition function?

[End of section]

Related GAO Products:

The following is a selected listing of recent GAO products relevant to 
the issues covered in the forum.

DOD Acquisitions: Contracting for Better Outcomes. GAO-06-800T. 
Washington, D.C.: September 7, 2006.

Nuclear Cleanup of Rocky Flats: DOE Can Use Lessons Learned to Improve 
Oversight of Other Sites' Cleanup Activities. GAO-06-352. Washington, 
D.C.: July 10, 2006.

Contract Management: DOD Vulnerabilities to Contracting Fraud, Waste, 
and Abuse. GAO-06-838R. Washington, D.C.: July 7, 2006.

Medicare Part D: Prescription Drug Plan Sponsor Call Center Responses 
Were Prompt, but Not Consistently Accurate and Complete. GAO-06-710. 
Washington, D.C.: June 30, 2006.

Defense Management: Attention Is Needed to Improve Oversight of DLA 
Prime Vendor Program. GAO-06-739R. Washington, D.C.: June 19, 2006.

Homeland Security: Contract Management and Oversight for Visitor and 
Immigrant Status Program Need to Be Strengthened. GAO-06-404. 
Washington, D.C.: June 9, 2006.

2010 Census: Census Bureau Generally Follows Selected Leading 
Acquisition Planning Practices, but Continued Management Attention Is 
Needed to Help Ensure Success. GAO-06-277. Washington, D.C.: May 18, 

Coast Guard: Changes in Deepwater Acquisition Plan Appear Sound, and 
Program Management Has Improved, but Continued Monitoring Is Warranted. 
GAO-06-546. Washington, D.C.: April 28, 2006.

Contract Management: Increased Use of Alaska Native Corporations' 
Special 8(a) Provisions Calls for Tailored Oversight. GAO-06-399. 
Washington, D.C.: April 27, 2006.

Hurricane Katrina: Planning for and Management of Federal Disaster 
Recovery Contracts. GAO-06-622T. Washington, D.C.: April 10, 2006.

Contract Security Guards: Army's Guard Program Requires Greater 
Oversight and Reassessment of Acquisition Approach. GAO-06-284. 
Washington, D.C.: April 3, 2006.

Defense Acquisitions: Assessments of Selected Major Weapon Programs. 
GAO-06-391. Washington, D.C.: March 31, 2006.

Homeland Security: Successes and Challenges in DHS's Efforts to Create 
an Effective Acquisition Organization. GAO-05-179. Washington, D.C.: 
March 29, 2005.

GAO's High-Risk Program. GAO-06-497T. Washington, D.C.: March 15, 2006.

Federal Bureau of Investigation: Weak Controls over Trilogy Project Led 
to Payment of Questionable Contractor Costs and Missing Assets. GAO-06- 
306. Washington, D.C.: February 28, 2006.

Media Contracts: Activities and Financial Obligations for Seven Federal 
Departments. GAO-06-305. Washington, D.C.: January 13, 2006.

NASA: Implementing a Knowledge-Based Acquisition Framework Could Lead 
to Better Investment Decisions and Project Outcomes. GAO-06-218. 
Washington, D.C.: December 21, 2005.

Defense Acquisitions: DOD Has Paid Billions in Award and Incentive Fees 
Regardless of Acquisition Outcomes. GAO-06-66. Washington, D.C.: 
December 19, 2005.

U.S. Postal Service: Purchasing Changes Seem Promising, but Ombudsman 
Revisions and Continued Oversight Are Needed. GAO-06-190. Washington, 
D.C.: December 15, 2005.

Defense Management: DOD Needs to Demonstrate That Performance-Based 
Logistics Contracts Are Achieving Expected Benefits. GAO-05-966. 
Washington, D.C.: September 9, 2005.

Framework for Assessing the Acquisition Function at Federal Agencies. 
GAO-05-218G. Washington, D.C.: September 1, 2005.

Medicare Contracting Reform: CMS's Plan Has Gaps and Its Anticipated 
Savings Are Uncertain. GAO-05-873. Washington, D.C.: August 17, 2005.

Interagency Contracting: Franchise Funds Provide Convenience, but Value 
to DOD is Not Demonstrated. GAO-05-456. Washington, D.C.: July 29, 2005.

Energy Savings: Performance Contracts Offer Benefits, but Vigilance Is 
Needed to Protect Government Interests. GAO-05-340. Washington, D.C.: 
June 22, 2005.

Financial Management: Thousands of Civilian Agency Contractors Abuse 
the Federal Tax System with Little Consequence. GAO-05-637. Washington, 
D.C.: June 16, 2005.

Interagency Contracting: Problems with DOD's and Interior's Orders to 
Support Military Operations. GAO-05-201. Washington, D.C.: April 29, 

Defense Logistics: High-Level DOD Coordination Is Needed to Further 
Improve the Management of the Army's LOGCAP Contract. GAO-05-328. 
Washington, D.C.: March 21, 2005.

Contract Management: Opportunities to Improve Surveillance on 
Department of Defense Service Contracts. GAO-05-274. Washington, D.C.: 
March 17, 2005.

Federal Acquisition: Progress in Implementing the Services Acquisition 
Reform Act of 2003. GAO-05-233. Washington, D.C.: February 28, 2005.

Contract Management: The Air Force Should Improve How It Purchases 
AWACS Spare Parts. GAO-05-169. Washington, D.C.: February 15, 2005.

Contract Management: Opportunities to Improve Pricing of GSA Multiple 
Award Schedules Contracts. GAO-05-229. Washington, D.C.: February 11, 

Best Practices: Using Spend Analysis to Help Agencies Take a More 
Strategic Approach to Procurement. GAO-04-870. Washington, D.C.: 
September 16, 2004.

Contract Management: Guidance Needed to Promote Competition for Defense 
Task Orders. GAO-04-874. Washington, D.C.: July 30, 2004.

Military Operations: DOD's Extensive Use of Logistics Support Contracts 
Requires Strengthened Oversight. GAO-04-854. Washington, D.C.: July 19, 

The Chief Operating Officer Concept and its Potential Use as a Strategy 
to Improve Management at the Department of Homeland Security. GAO-04- 
876R. Washington, D.C.: June 28, 2004.

NASA: Lack of Disciplined Cost-Estimating Processes Hinders Effective 
Program Management. GAO-04-642. Washington, D.C.: May 28, 2004.

Federal Acquisition: Increased Attention to Vehicle Fleets Could Result 
in Savings. GAO-04-664. Washington, D.C.: May 25, 2004.

Tax Debt Collection: IRS Is Addressing Critical Success Factors for 
Contracting Out but Will Need to Study the Best Use of Resources. GAO- 
04-492. Washington, D.C.: May 24, 2004.

HUD Single-Family and Multifamily Property Programs: Inadequate 
Controls Resulted in Questionable Payments and Potential Fraud. GAO-04- 
390. Washington, D.C.: March 3, 2004.

Defense Management: Continuing Questionable Reliance on Commercial 
Contracts to Demilitarize Excess Ammunition When Unused, 
Environmentally Friendly Capacity Exists at Government Facilities. GAO- 
04-427R. Washington, D.C.: April 2, 2004.

Competitive Sourcing: Greater Emphasis on Increasing Efficiency and 
Improving Performance. GAO-04-367. Washington, D.C.: February 27, 2004.

Financial Management: Some DOD Contractors Abuse the Federal Tax System 
with Little Consequence. GAO-04-95. Washington, D.C.: February 12, 2004.

Contract Management: High-Level Attention Needed to Transform DOD 
Services Acquisition. GAO-03-935. Washington, D.C.: September 10, 2003.

Best Practices: Improved Knowledge of DOD Service Contracts Could 
Reveal Significant Savings. GAO-03-661. Washington, D.C.: June 9, 2003.

Best Practices: Setting Requirements Differently Could Reduce Weapon 
Systems' Total Ownership Costs. GAO-03-57. Washington, D.C.: February 
11, 2003.

Acquisition Management: Agencies Can Improve Training on New 
Initiatives. GAO-03-281. Washington, D.C.: January 15, 2003.

Military Readiness: Civil Reserve Air Fleet Can Respond as Planned, but 
Incentives May Need Revamping. GAO-03-278. Washington, D.C.: December 
30, 2002.

Acquisition Workforce: Status of Agency Efforts to Address Future 
Needs. GAO-03-55. Washington, D.C.: December 18, 2002.

DOE Contractor Management: Opportunities to Promote Initiatives That 
Could Reduce Support-Related Costs. GAO-02-1000. Washington, D.C.: 
September 20, 2002.

Acquisition Workforce: Department of Defense's Plans to Address 
Workforce Size and Structure Challenges. GAO-02-630. Washington, D.C.: 
April 30, 2002.

Best Practices: Taking a Strategic Approach Could Improve DOD's 
Acquisition of Services. GAO-02-230. Washington, D.C.: January 18, 2002.


[1] These issues are highlighted in greater detail in GAO, 21st Century 
Challenges: Reexamining the Base of the Federal Government, GAO-05-
325SP (Washington, D.C.: Feb. 16, 2005).

[2] Pub. L. No. 103-355 (1994). The Federal Acquisition Streamlining 
Act of 1994 authorized, among other things, federal agencies to enter 
into multiple award, task-and delivery-order contracts for services and 
products. These contracts provide agencies with a great deal of 
flexibility in buying goods or services while minimizing the burden on 
government contracting personnel to negotiate and administer contracts. 

[3] Pub. L. No. 108-136, Title XIV (2003). The Services Acquisition 
Reform Act of 2003 provides agencies an array of tools to improve the 
acquisition of services in four major areas--acquisition workforce and 
training, business acquisition practices, commercial item acquisitions, 
and other procurement flexibilities. 

[4] GAO, High-Risk Series: An Update, GAO-05-207 (Washington, D.C.: 
Jan. 2005).

[5] Since 1955, the executive branch has encouraged federal agencies to 
obtain commercially available services from the private sector when the 
agency determines that it is cost-effective. In 1966, the Bureau of the 
Budget formalized this administrative policy in its Circular A-76. 
Additionally, the Office of Management and Budget (OMB) requires 
agencies to identify activities that are inherently governmental, as 
well as commercial positions that are exempt from A-76 competitive 
sourcing processes because of legislative prohibitions, agency 
restructuring, or other reasons. 

[6] As required by the FAIR Act, Pub. L. No. 105-270 (1998), agencies 
develop inventories of their commercial activities. Only activities 
classified as commercial and not otherwise exempt are potentially 
subject to competition under Circular A-76 processes. 

[7] CORs are the individuals from program and mission offices appointed 
to provide the technical expertise necessary to convey the requirements 
of the government, oversee the work of the contractor, and ensure that 
deliverables meet requirements. The U.S. Merit Systems Protection Board 
(MSPB) recently reported findings and recommendations based on a survey 
of CORs from several agencies. See MSPB, Contracting Officer 
Representatives: Managing the Government's Technical Experts to Achieve 
Positive Contract Outcomes (Washington, D.C.: December 2005). 

[8] Office of the Inspector General, DOD, Human Capital: Report on the 
DOD Acquisition Workforce Count, D-2006-073 (Washington, D.C: April 17, 

[9] The Clinger-Cohen Act of 1996, Pub. L. No. 104-106, Divs. D & E 
(1996), and the Defense Acquisition Workforce Improvement Act, Pub. L. 
No. 101-510, Title XII (1990), among other things, provided specific 
guidance and requirements to civilian agencies and DOD to establish 
acquisition workforce requirements. 

[10] One participant pointed out that the congressionally authorized 
Acquisition Advisory Panel has reviewed qualitative and quantitative 
issues regarding the federal acquisition workforce. On its Web site at, the panel has published 
findings and provisional recommendations addressing many of the 
workforce capacity and capability issues raised by the GAO forum 

[11] Partnership for Public Service, Back to School: Rethinking Federal 
Recruitment on College Campuses, PPS-06-01 (Washington, D.C.: May 

[12] According to OMB, the Program Assessment Rating Tool was developed 
to assess and improve program performance so that the federal 
government can achieve better results. Such a review helps identify a 
program's strengths and weaknesses to inform funding and management 
decisions aimed at making the program more effective. 

[13] Strategic sourcing is the collaborative and structured process of 
analyzing an organization's spending by standardized categories of 
goods and services (i.e., commodities) and using the information to 
develop strategies to reduce all costs associated with purchasing a 
given commodity and also to improve mission delivery. 

[14] Under the Civil Reserve Air Fleet program, U.S. commercial air 
carriers commit under contract with DOD to put aircraft into use during 
emergencies. The airlines receive no compensation for their 
participation in the reserve fleet unless they are activated, but they 
are given an incentive to participate by being made eligible to bid for 
DOD's peacetime airlift business. Only carriers that participate in the 
Civil Reserve Air Fleet program can bid in peacetime airlift business. 
Another incentive is the airlines' participation in GSA's City Pairs 
program, which provides discounted air passenger transportation 
services to federal government travelers. 

[15] Under the LOGCAP program, the Army uses private sector contractors 
to provide a range of support to U.S. forces, including laundry and 
bath, food service, sanitation, billeting, maintenance, and power 
generation. As of January 2005, LOGCAP has involved more than $15 
billion in estimated work by contractors. 

[16] See the Web site at 

[17] Performance-based acquisition means an acquisition structured 
around the results to be achieved as opposed to the manner by which the 
work is to be performed. Performance-based contracts for services must 
include a performance work statement that describes the desired 
outcomes in measurable terms as well as the method of assessing 
contractor performance against standards. 

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