Jump to content

Category Management?


Guest Vern Edwards

Recommended Posts

Category management is just another name for something that's practiced a lot, particularly in the private sector with large corporations. Its just a twist on strategic sourcing. Regardless, the big question is why should the government be duplicating contracting efforts for the same things many times over.

Of course there are lots of good reasons. Then there are lots of reasons why they shouldn't. If you look at buying practices across the government for the same commodity, there are good results from very experienced buyers and there are horrible results from others. So why not have the best buyers contract on behalf of the entire government and really leverage the buying power?

A lot of duplication and waste exist right now and without good reason. I heard one agency say they won't use GSA Schedules because their management evaluates the contracting office and their need for staffing resources on the volume and complexity of work they do. A GSA Schedule order gets a fraction of weight compared to them doing their own contract. Many other agencies say GSA Schedules won't allow them to negotiate their own special terms and conditions on task orders, which isn't true. So many existing ways to save money and time are in place now but aren't used such as GWACS, GSA Schedules, other agency contracts using interagency agreements, etc.

In order for this concept to work, agencies need to be forced to use the sources. More importantly agencies will have to relinquish some of their existing flexibilities to buy items unique to them or those that simply reflect personal preferences. I remember a firearms manufacturer at a conference saying that the non-military section of the government uses 22 makes/models of handguns. Probably most important, agencies need to give up control over the management of their needs and spending. That's an uphill battle and I don't see the Administration willing to do battle to win.

Link to comment
Share on other sites

He could but just imagine all the pushback - intelligence agencies saying national security is dependent upon their contractors, defense saying only certain large businesses are capable and their requirements are so unique it will drive up costs for other agencies, Homeland Security saying they need flexibility only companies familiar with them can provide. It goes on and on. Every agency says they are unique. Cabinet Secretaries can't even make their components share the same data centers.

Link to comment
Share on other sites

Formerfed has a point. Getting the requisitions into GSA by a certain date will be challenging.

Also, this will also magnify the damage a bad Contracting Officer can do, right? These folks will have to be *good*. CO talent evalaution is hard, and the Feds have to get it right (they cannot easily get rid of the bad ones). Retaining good COs in GSA may also be hard.

Splintering these purchases around the agencies and the general CO workforce yields a predictable and managable level of dysfunction, some good puchases, some bad. Consolidating into one office will raise the variance in both directions- both good and bad.

Does not make it a bad idea. I'm focusing on the negative here because they are harder to see than the positives.

Link to comment
Share on other sites

There is no doubt that agencies currently do not utilize GSA and commercial item contracting for the benefits intended. Heck throw in simplified acquisition procedures too. Overall it seems the basic premise of FAR Part 8.0 has been forgotten. By example efforts to skirt AbilityOne or when was the last time you heard someone say “I need to check excess property listings and sources first” when a supply is needed?

We already have Category Management it is called the FAR and if they would concentrate on it (with money and effort for an adequate workforce) rather than always trying to find something “new” to promote it might just solve the problems, real and percieved.

Link to comment
Share on other sites

The above comments begs the question....are there too many federal contracting officers? This is counterintuitive to what is commonly the theme you hear in contracting operations across the government. "We don't have enough COs" "We are understaffed" From my understanding there still remains authority for direct-hire for the 1102 field.. Would the answer to replicated procurements be to squeeze off the 1102 series? Then people won't have time to waste putting together vehciles for commodity/cots/commercial items and can do the hard stuff that is actually much more interesting and challenging.

Link to comment
Share on other sites

Guest Vern Edwards

Jon:

I think that the question underlying category management is whether there are too many contracts, not too many contracting officers. However, in a well-managed acquisition universe there would be fewer contracting officers, more unwarranted contract specialists, a lot more purchasing agents, and a whole heck of a lot more procurement clerks/technicians.

Link to comment
Share on other sites

I think Category Management is just the latest buzzword of the beltway. FSSI has lost its luster and now a new catch phrase has to come in. In 2-3 years, CM will be all but forgotten and a new shiny object (buzzword) will take its place. Cynical, I know, but it's what I've seen over and over.

Link to comment
Share on other sites

I'm interested to see how the tension between supplier diversity and strategic sourcing works out for the Federal government. In my experience, it's one or the other, but not both.

H2H

Link to comment
Share on other sites

Either works out to the detriment of (statutorily and regulatorily undefined) mid-sized businesses in my experience. Diversity favors small businesses with preferences, and strategic sourcing favors truly large businesses offering economy of scale.

Link to comment
Share on other sites

Guest Vern Edwards

help:

The government has socio-economic objectives as well as money-saving objectives. For example, if competition saves money and the more competition the better, then small business set-asides, which restrict competition, cost money. The government does a tradeoff. It sacrifices cost savings in order to get socio-economic benefits. The same with other socio-economic programs: Buy American, minimum wage laws, etc. The government tries to optimize under conflicting objectives.

Link to comment
Share on other sites

Vern,

Yes, I agree. There is a tension between competing objectives (see my post #11). "The government" (which is made up of people guided by policies/procedures and aided by processes) tries to optimize its decisions and balance the competing objectives.

The problem is that there can be no rational trades between the competing objectives when the options aren't given their proper weighting, and when the weightings aren't communicated to those making the decisions, and when those making the decisions don't have sufficient discretion. If the processes don't support the trade analysis, and the policies/procedures don't specify the urgency and/or weighting of the competing objectives, and decisions made are subsequently reversed for unwritten/unknown reasons, then what hope do the individuals have of making rational decisions that optimize outcomes? They're just picking blindly and hoping it all works out for the agency in the aggregate.

I agree with your recent post in another thread. This is how it works. The system is designed in such a manner that decisions that lead to optimal outcomes are nearly impossible to make.

Kafka would have a field day.

H2H

Link to comment
Share on other sites

Competing objectives pretty much sums up a lot about government buying. Its confusing when you try and sort through it all. Pick just one like socio-economic and it's puzzling on its own. If I have a requirement that can be met by women owned, veteran owned, minority owned business, etc., which do I pick?

From a high level, category management makes sense. Have the agency with the most expertise and knowledge do the consolidated buying. But if I truly consolidate and leverage the buying power to get the most favorable pricing, I likely will exclude small businesses. I also likely will award to a very few number of sources at the expense of spreading buisness to many companies. So a handful of companies reap rewards which many other companies are injured.

At the same time this concept probably hurts individual agencies and their programs because it takes away preferences and unique but needed features of products and services. There's a cost associated with "one size fits all."

What would be nice is for the government to eliminate these conflicts.

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
×
×
  • Create New...