Expert Q&A: Renewing Federal Agencies’ Commitment to Requirements-Based IT Procurement

For countless federal agencies pursuing IT modernization projects, difficulties procuring innovative, high-value products and services have been the proverbial thorn in their side. Just this month the Government Accountability Office (GAO) added “Managing IT Acquisition and Operations” to its 2015 High Risk List. Similarly, recent survey findings from Government Business Council (GBC), the research division of Government Executive Media Group, suggest that less than 40 percent of federal managers are confident in their agency’s ability to procure the IT products and services necessary to achieve its mission objectives.

To shed light on the most persistent challenges in federal IT procurement, as well as how federal agencies can overcome these obstacles, we sat down with Tony Celeste, Director of Federal Sales at Brocade, whose career in public sector IT spans more than three decades. For Celeste, a renewed commitment to requirements-based procurement will translate to more competition and greater innovation.

Q: What would you say are the greatest strengths and limitations of the federal IT procurement process as it currently exists?

Clearly the most significant strength in the way the government buys anything, especially IT, is the public nature of the process: it’s open and there’s disclosure. The acquisition process is very well-defined under the FAR; it has a set of uniform policies and procedures to manage cost, quality, and timeliness while mandating integrity, fairness and openness.

But of course, it’s a double-edged sword. As you can imagine, the FAR specifies how to procure goods as distinct as aircraft carriers and office furniture. There are a lot of rigid policies that simply don’t apply to buying IT and oftentimes create undue complexity. In addition, there is often a lack of understanding between those on the program management side of the house, the contracts and acquisitions side, and the users themselves. This contributes to a “check-the-box” mentality, which perpetuates misalignment between IT requirements and desired outcomes.

Q: A major finding of the GBC study is that only 54 percent of federal managers say their agency’s IT procurement process is sufficiently competitive. Does that strike you as low?

Yes, 54 percent does seem low, especially when you have a process that’s designed to drive competition and transparency. That figure should be much higher.

Q: So what then are the major factors limiting competition?

To start off, the FAR mandates that agencies conduct acquisitions on the basis of vendor-neutral requirements that are competitive to the maximum extent practical. The government also requires compliance with open standards, but a major problem we’re seeing is that agencies fail to use them in their implementations. The problem is later perpetuated because, in a narrow set of circumstances, agencies are allowed to limit bids to a single brand or manufacturer if market research demonstrates that doing so is the only way to meet a specific mission-critical need or requirement.

But more often than not, we’re seeing ‘brand-specific sourcing’ being misused and overused. The same GBC study found that 42 percent say brand-specific sourcing is commonplace in their agency, while more than one quarter say it’s used inappropriately at least some of the time. Once you limit the field to, say, one specific brand of smartphone -- instead of any smartphone that can deliver capabilities X, Y, and Z -- you’re excluding a number of potential suppliers and giving the incumbent an unfair advantage later on when that agency starts developing its next set of requirements.

Q: But let’s say an agency already knows which product it wants. Won’t brand-specific sourcing help it save time? How does this hurt federal agencies?

It’s a common misperception that brand-specific sourcing is less complex and therefore that it helps to save time and reduce the administrative cost of the acquisition process. That thinking also fails to take into account the opportunity cost of not considering alternatives that could provide equal capabilities at lower cost in the long-run.

Where the lack of competition really hurts federal agencies, where it really hurts the U.S. IT industry, and where it really hurts American taxpayers, is that it diminishes the incentives to invest in research and development. What it really hurts is innovation. Lack of competition means that the government keeps getting status quo products and a status quo acquisition process that reinforces the inertia in the system. GAO recently reported that, of the roughly $84 billion we spend on IT every year, more than 70 percent goes to maintaining status quo legacy infrastructure. Only a small fraction is going to new requirements and new innovation. We have to find some way to break that cycle.

Q: Speaking of GAO, it recently moved ‘Managing IT Acquisition and Operations’ to the 2015 High Risk list. Is that a step in the right direction? What else could agencies do to improve IT procurement?

Obviously this is a step in the right direction. It’s an acknowledgement of the central role IT now plays in mission success. Is it enough by itself? No. That said, GAO isn’t the only one elevating the importance of IT acquisition: the House Oversight Committee, for example, championed FITARA, a bill that puts greater buying power in the hands of federal CIOs. But there are a lot of reasons why people are taking note of IT acquisition. And it’s not just about mission success, it’s a matter of national security. As agencies’ missions and our critical infrastructure become more and more dependent on IT, the cyber threat is growing exponentially. Agencies simply have to find more innovative solutions if they’re going to counter that threat. So we’re not just seeing a push from the legislative side, we’re seeing it from the executive side -- OMB, GSA, the Office of Science and Technology Policy (OSTP) -- as well.

Q: Beyond policy, how can mid- and senior-level federal managers approach IT acquisition in a more proactive way?

The most important thing I can tell federal managers is to assess their agency’s long-run mission objectives and to define their requirements and desired capabilities within that context. It’s not as if IT is simply a commodity. That’s why it’s so crucial that procurement offices take the time to set their requirements based on sound market research.

It’s essential to build on the current momentum. Reaffirming the federal government’s commitment to a vendor-neutral, requirements-based acquisitions process will drive competition, reduce costs for federal agencies, incentivize R&D, promote innovation, create jobs, and improve the quality of services provided to the warfighter and taxpayer. To me, at least, that seems like a pretty compelling idea.

About Brocade

Since 1995, Brocade has empowered government agencies to accomplish their missions through leading-edge networking solutions and modernized IT infrastructure. Today, Brocade is helping agencies realize the benefits of cloud computing, mobility, and Big Data as they increase operational efficiency, offer new services to constituents, and reduce total cost of IT ownership. A key part of this strategy is enabling agencies to embrace the New IP, a modern approach to networking built on open, multivendor, user-driven, and software-centric infrastructure. The New IP allows agencies to develop flexible networks that can easily adapt to meet the critical challenges of both today and tomorrow. Whether that involves simplifying access for citizens or empowering war fighters to complete their mission, Brocade delivers the networks that connect modern government with the world. (www.brocade.com)

This content is made possible by Brocade. The editorial staff of Nextgov was not involved in its preparation.