In July 2014, NCMA Executive Director Michael Fischetti interviewed Jeff Koses, senior procurement executive, Office of Acquisition Policy, General Services Administration (GSA), to discuss how acquisition operates within GSA, as well as his priorities for the future.
As the senior procurement executive for GSA, what do you consider to be your main priorities?
I have three main priorities:
- Strengthen the acquisition workforce,
- Promote smart and effective buying, and
- Build healthy and productive industry relationships.
I tie these three priorities together, in the belief that GSA needs a strong acquisition workforce that effectively engages industry and fosters healthy and productive relationships to drive smart and effective buying across the U.S. federal government. Under each priority, I have a series of initiatives, each with action owners and performance metrics.
Given the current budget scenario and economic austerity, what are your key initiatives to support customer efficiencies, mission changes, and acquisition policy?
I believe we always have to begin with the acquisition workforce. Over the last five years, GSA has experienced a 39-percent attrition rate in its acquisition workforce (many of them GS-1102s) and, currently, has an 18-percent vacancy rate in the GS-1102 field. Over the last two years, nonretirement attrition has slowed while the number of retirement-eligible 1102s is expected to rise in fiscal year 2015 and beyond. Meanwhile, GSA acquisition internship opportunities are expected to decline in fiscal year 2015. Research suggests that “millennials” tend to stay in jobs between two to three years before moving to different employment, yet it takes five to ten years to fully develop an acquisition professional. This means that GSA, as well as other agencies, will have to rethink approaches to hiring, training, and retaining acquisition professionals. One key to that is ensuring that we provide content in ways that acquisition professionals are familiar with receiving and consuming information.
We know that the things we expect from the acquisition workforce are changing considerably. At one time, acquisition was primarily a technical discipline. Now, it has become a leadership discipline. Responsibilities include program management, data analysis, strategic planning, performance management, emotional intelligence, and industry relationships. Effective communication and leadership skills are more essential than ever before.
Budgets are increasingly uncertain, with significant year-to-year swings in funding appropriated to GSA, and flat or falling budgets for many users of GSA’s contract solutions. Fluctuating budget levels make long-term strategic planning far more challenging and will likely force GSA to reconsider best acquisition strategies to accomplish work, which may be funded sporadically.
It is possible that a proposed long-term spending freeze for nonsecurity discretionary programs will lead some federal agencies to increase reliance on GSA to pursue stronger leveraged prices. Other agencies may see that as an opportunity to “insource,” with the perception of savings by not paying fees for acquisition support. Both scenarios will require GSA to find ways to demonstrate greater value from acquisition and acquisition solutions at each and every step of the process.
How is GSA addressing strategic sourcing?
GSA has been a prime leader in implementing the Federal Strategic Sourcing Initiatives (FSSIs) for the federal government. Our demonstrated success in running the FSSIs for Office Supplies (OS2)1 and Domestic Delivery Services (DDS) served as proof of concept, and enabled the Office of Management and Budget (OMB) to task GSA to set up 10 more solutions on behalf of the entire federal government. GSA has established a program office to support FSSIs across government.
Through the FSSI efforts, the total savings from fiscal year 2013 topped $300 million and business volume continues to grow. GSA now has awards in place for wireless, office supplies, domestic delivery, print management, janitorial and sanitation supplies, maintenance, repair, and operational supplies. GSA is leading a host of additional efforts that will lead to greater savings by bringing better demand management strategies to the federal government in areas such as furniture and facilities management.
GSA is leveraging and learning from these in moving to a category management approach and in developing a “Prices Paid Portal” to enable federal agencies to see and compare pricing across government.
How is GSA handling quality and oversight objectives against streamlining and fast turnaround?
One of the tougher challenges for the workforce is hitting that right balance between mission need and contract quality. Moving too far in either direction results in suboptimal performance. Over the last few months, GSA has completed a top-to-bottom review of acquisition across the agency. It showed us a need to bump up our customer service metrics, and to recalibrate our Procurement Management Reviews (PMRs). We’ve just completed that recalibration, which we believe will result in better and more meaningful contract reviews so that they better support the business objectives and fulfill a training role for the contracting officers and contract specialists.
How does GSA view OMB’s “Myth-Busting”2 campaign?
GSA strongly embraces the Myth-Busting campaign and I have folded it right back into my top priorities. I believe OMB is right and that early industry engagement improves requirements, increases competition, and results in better contract outcomes.
We are currently working with a few contractors to put together a training session focusing on “Why I didn’t bid on your contract” to help us improve on our competitive “one-bid”3 metric and to really understand the business decision to compete or not to compete for a specific opportunity.
How does GSA address the source selection process, including “lowest price technically acceptable” (LPTA)?
In our training, we emphasize LPTA as one approach to source selection—and that where it best fits is where it should be used. We use it, for example, in some of our commodity focused federal strategic sourcing solutions. However, in our “One Acquisition Solution for Integrated Services” (OASIS) and “OASIS Small Business” (OASIS SB) awards,4 we went with an innovative “high technical” fair and reasonable pricing approach and found really good results.
We try to equip our contracting officers with the right training and information, and then let them make the right business decisions, with the outcome being achievement of best value.5
How does GSA handle contract administration?
One key aspect of our recent recalibration of the PMRs was to better capture and share best practices. PMRs should capture both the areas where we need to do better and those areas where we’ve found really good practices.
One place where we’ve seen a lot of good and interesting practices is in the emerging area of acquisition and social media tools. Whether we’re talking collaboration (i.e., industry engagement) tools, prices paid data, or visualization tools, we’re seeing some very good and interesting use of digital-age tools, and are developing ways to share and convey those across the agency.
Key ways of sharing this information include addressing them to our heads of contracting activity and competition advocates through regular meetings and making them available to all of our 1102s through our new acquisition portal, which is an internal one-stop-shop for all resources related to acquisition.
Many federal agencies are feeling the effects of staffing shortages of late. Has GSA been affected?
Yes, like many other agencies, GSA is dealing with an increasing workload—both in terms of volume and complexity—with staffing shortages, and with a prolonged and complex hiring process. GSA is in the early stages of looking at potential equivalencies between the university level concentrations in acquisition and the Federal Acquisition Institute (FAI)/Defense Acquisition University (DAU) curriculum. By better leveraging such courses, we may be able to hire better-qualified candidates faster, and because these people know they have an interest in acquisition, we may do a better job retaining them than we do with recent graduates from other disciplines.
What previous education, experience, roles, etc. have you been able to leverage and bring forward into your current position?
I graduated from Washington University in St. Louis, with a BA in history and political science, and promptly accepted a management intern position at GSA. I later earned an MA in acquisition management. From the beginning of my career, I asked a lot of questions, and was fortunate in having managers willing to hear and think about those questions. I have headed operational contracting and worked closely with the Department of Defense and civilian agencies to tailor acquisitions to their requirements. I led the Office of Supplier Management and learned a lot about communicating and motivating contractor performance, and I led the Office of Acquisition Management, and was able to work on policy and acquisition workforce issues.
Across these different roles, two key acquisitions helped shape and form my approach to acquisition. In the mid-1990s, I returned from paternity leave to find I had been moved to a new position: I was now the contracting officer for the GSA “City Pair” program. The City Pair program is comprised of governmentwide contracts for air travel for federal employees on official duty. They are annual contracts, with a total estimated value of about $1.4 billion per year at that period in time. On my first day back in the office, I was handed a stack of protests to defend, told the recompete was four months behind schedule, and that the contract specialist on my team had been working 90–100 hours per week for the last six months to get to the award.
I then immediately got the flu, and as I was answering protests with a fever of 104°, I realized we make acquisition entirely too hard. I started modeling new and simpler evaluation processes and began a series of regular meetings with the airline industry to exchange views and concerns with the City Pair program. I also began automating the process, at first using a simpler relational database tool, and later working with the CIO to build an application.
This proved successful; we awarded the follow-on contracts on time and went over a decade without another protest. Thanks to automation, we were able to make awards and manage the program without much use of overtime. I was even honored with NCMA’s Blanche Witte Memorial Award6 for my efforts. Ever since, I’ve always emphasized simplifying the acquisition process, bringing industry into the acquisition process earlier, and maximizing use of automation.
A second key acquisition for me was in 2010, with the FSSI for office supplies. Strategic sourcing had long been a best practice in the commercial sector; the challenge was to effectively apply it to the federal sector. The “second generation office supplies solution” (OS2) was to stand as the test case to see if the federal government could act together—and in doing so, if it could reduce the cost to the government.
I began this initiative with about a dozen different federal agencies, and we started off by defining our objectives. Frankly, it was rather astonishing how many different objectives federal agencies could have in buying office supplies—ranging from the obvious (e.g., price, compliance withstatutes and regulations, socioeconomic considerations, etc.) to ones we anticipated (e.g., environmental attributes, ease of use for purchase card holders, etc.) to ones we were surprised by (e.g., delivery attributes, electronic system integration capability, etc.), and much more. Over a few weeks, we agreed on a few goals and began talking with industry.Through the industry conversations, we started to learn more and more about how our requirements drove the pricing. We found that we routinely asked for overnight delivery, asked them to process very small orders, and sometimes we asked that the orders be delivered, by a courier with a clearance, to our desktops. We also included a requirement for line item or transactional data as a key deliverable in the contract instrument.
Over the four-year run of OS2, by driving competition, reducing our requirements, and managing and sharing the transactional data, we were able to drive savings of hundreds of millions of dollars. Since OS2 was awarded, prices in the commercial marketplace increased 14 percent, while prices actually paid by federal agencies declined 12 percent.
Coming out of that experience, key lessons I continue to apply include recognizing that even on the simplest buy, requirements are a huge driver of price, it is possible to work across federal agencies to move all of us in a common direction, and big data has big potential to drive big savings.
How do you measure the effectiveness and efficiency of contracting for your customers? Are there metrics or tools you use to assess and measure customer satisfaction?
We use a wide range of metrics in assessing our performance, and have recently created an acquisition dashboard to share them with our heads of contracting activity across the nation. They include:
- Competition rate;
- One-bid competition rate;
- High-risk contracting (i.e., percentage of dollars through time and materials and cost reimbursement);
- Performance-based acquisition rate;
- Past performance compliance rate;
- FAC-C certification rate; and
- All the socioeconomic statistics.
We’ve been thinking and working on updating our suite of metrics. From a customer service goal, we’re looking at a spend coverage/market share goal, a customer satisfaction goal, and a supplier satisfaction goal. From a workforce standpoint, we’re looking at:
- Acquisition workforce job satisfaction index;
- Acquisition workforce employee engagement index;
- Acquisition workforce results-oriented performance culture index;
- Turnover of acquisition workforce (i.e., the percentage of
employees separated each year); and
- Vacancy rate for the acquisition workforce (i.e., employee onboard count/full-time equivalent (FTE) ceiling).
From a public policy standpoint, in thinking about how we leverage the purchasing power of the government, we are evaluating:
- Savings rate: (year-over-year savings + cost avoidance) ÷ dollars obligated;
- Function cost: (function budget ÷ dollars obligated) or (functional budget ÷ number of contract actions);
- Procurement return on investment: (year-over-year savings + cost avoidance) ÷ function cost; and
- Percentage of compliance with small business targets (e.g., small disadvantaged businesses, women-owned small businesses, service-disabled veteran–owned small businesses,
and historically underutilized business zone small businesses).
And from an operational efficiency rate:
- Savings per FTE: (year-over-year savings + cost avoidance) ÷ FTEs;
- Spend per FTE: dollars obligated ÷ FTEs (1102s and broader acquisition workforce);
- Transactions per FTE: transactions ÷ FTEs (1102s and broader acquisition workforce);
- PMR assessment on contracting activities; and
- Number of gaps closed on identified areas to strengthen acquisition workforce performance.
How is the contracting function viewed within your organization? What cultural, organizational, policy, and workforce examples exist in your organization that assist in improving your performance?
GSA is, of course, an acquisition agency, and so there’s some good understanding of the importance and role of the acquisition function.
I found a couple key challenges when I entered into the senior procurement executive role. One was that we don’t share a common contract writing system, and didn’t have a central acquisition portal. Across the agency, we identified and cataloged about 50 different policy websites. One of our key initiatives in recent months has been to stand up one central acquisition portal for all of GSA, and to populate it with appropriate content and links.
We’re also working to increase the accessibility of our policy documents. Those of us deeply in the field tend to write and communicate in very technical language, leaving our newer employees unclear on intent and meaning of policy documents. In trying to take steps to write policy and implementation instructions in plain language, we’re finding it is leading the policy team to ask a lot more questions—a positive and interesting development.
Today’s contracting workforce is very challenged to meet their mission in this new era of economic austerity. What message would you like to convey to your government and industry colleagues and customers regarding how you are managing these challenges?
Between budget cuts, heightened oversight, and new availability of social media tools, we not only face a new degree of challenge, but an unprecedented level of opportunity for contract management. This means there will be a lot of disruptive change, and that we’ll have to move even faster, but it is also an opportunity to be creative, bold, and to try new approaches.
Earlier this summer, we saw the Office of Federal Procurement Policy sponsor a national dialogue on reducing burdens and barriers.7 It was a fascinating conversation, as industry weighed in to share thoughts on where and how the regulatory and reporting burdens weigh down the acquisition process.
Opportunities to revisit fundamental approaches are rare; we need to view this as a huge opportunity, and really push forward with simplification of the acquisition process.
Contracting workforce training is often highlighted as an area of concern and solution to real or perceived problems in today’s acquisition system. How do you react to the notion that training is a key issue?
Training is always a key issue. The budget cuts of the last few years make it even more important. As dollars grow tighter, the federal government will continue to rely on its industry partners to achieve its mission objectives, and will have to find new ways to bring efficiency into the acquisition process and identify and remove cost drivers. A great many elements of the acquisition process add layers of cost and complexity—from overlays of reporting requirements to contract duplication, and to solicitations that measure and award proposal writing.
To reduce the cost of acquisition, we have to rethink much of how we deliver training. Over the last couple years, the FAI and DAU have begun adding content that is better focused on how people actually buy, including more courses on task order contracting, rolling out acquisition learning seminars, and moving to greater incorporation of distance learning. I’m challenging FAI to go even further in this direction, and to focus on availability of just-in-time training, creating “knowledge nuggets” of 20- to 30-minute topical training that is readily accessible through FAI.gov to help the acquisition workforce in areas such as industry engagement, market research, verbal presentations, and acquisition initiatives, which may even reduce costs in the process.
How do you view the effectiveness of the training your acquisition workforce receives? Does it address the subjects you believe they need to know, or are there areas for improvement?
I believe that we have strong and solid training in the core discipline of acquisition, but sometimes we struggle with how to apply the training in a real-world situation. There is enormous diversity in the services and products our acquisition workforce buys, and in the challenges they face.
I prefer training that emphasizes how to think through the challenge, and how to communicate the result, rather than simply providing the technical answers. The acquisition workforce is most capable of looking up the technical answer to a specific situation—our training really has to promote the process of thinking through the available alternatives, how and when to use different tools, and how to assess and understand the impact of the decision made. That’s one reason I see the early interest in gaming or simulating as promising. If this is properly designed, to help the contracting officer recognize how the requirements and communication drive cost and bid/no-bid decisions, and the role of the different stakeholders, we end up with a better acquisition system.
I also believe that there is greater need for “soft” skills as part of the acquisition curriculum. Communication, facilitation, and team-building skills are sometimes underrepresented. The strongest contracting officers possess these skills and use them in managing acquisition programs.
How effective or relevant are the techniques used to deliver training (e.g., online learning, classroom-based learning, lectures, practical exercises, rotational experience, etc.)?
With four generations currently employed in the workplace, learning styles vary more than ever before. Elsewhere in our lives, the new media have taught us that we have to provide content in the way people are looking to consume it. The millennial generation is made up of “digital natives”; they think about and approach issues differently, and our training and development has to recognize this.
At the same time, electronic tools mean we’ve become an increasingly diverse workforce, with more acquisition professionals teleworking, in distant field offices, and connecting via technology. We may not have the training dollars to bring these people to the metropolitan hubs for training, and thus, we have to better leverage distance or online training.
Even so, several of the FAI/DAU courses require in-person training for very good reasons. To me, the in-person courses are the best ways to provide training on certain key competencies, such as negotiation or IPT management, for example. They are also central as capstone courses at the top of each certification level.
When balanced against formal training, how important is relevant experience in determining the effectiveness of today’s contracting workforce?
This has been a longstanding debate in the acquisition community. Some will passionately argue that a good 1102 is one who is trained to buy any service or product. Others will argue just as strongly that subject matter expertise is critical in making a good 1102. At GSA, we’re squarely in the latter camp. Our future direction is built around the notion of category management, where we can play a “clearing house” role, acquiring and using knowledgeable experience.
You have had a successful career in contracting. What reflections do you have as you look back from where you are today? What advice and guidance would you like to share for those just entering this field or who are relatively new to it?
Acquisition is a great field. We make up less than 2 percent of all federal employees, yet over the past several years, we have annually leveraged over $500 billion to fulfill agency needs and to provide services to the American people.
To me, the keys to success are:
- Take on the toughest acquisitions,
- Ask lots of questions,
- Bring industry into the dialogue early, and
- Never stop learning.
Your participation in this interview and Contract Management Magazine is an integral part of the learning component for NCMA’s more than 20,000 members around the world. Please share a few of your thoughts on the importance of professionalism in contracting, such as outside activities, advanced learning or degrees, or any other perspective.
We’re working in a time when too many have lost faith in government, and in our ability to solve problems. If ever there is a clear call to action, it should be exactly this challenge:
- To work to restore the American people’s faith in their government and in our ability to spend and invest wisely,
- To deliver performance on time and on budget, and
- To do so with a high degree of professionalism.
Any training or developmental opportunity that better prepares us to meet this challenge is an effort well worth taking.
Do you support your employees becoming involved and taking advantage of professional development opportunities through NCMA (e.g., becoming a chapter volunteer, speaking at or attending training forums, writing for the Journal of Contract Management or Contract Management Magazine, obtaining advanced certifications, etc.)?
I sit on the NCMA Board of Advisors, and encourage GSA acquisition professionals to attend major NCMA events, and otherwise participate in all the professional development opportunities.
ABOUT JEFF KOSES
JEFF KOSES is the senior procurement executive for GSA, where he has focused on strengthening the acquisition workforce, buying smartly and effectively, and creating healthy and productive industry relationships. He and his team are currently developing the tools and strategies to advance these priorities. He also serves as a voting member of the Federal Acquisition Regulatory Council.
For the last six years, he served as director of acquisition operations within the Federal Acquisition Service, where he led several FSSIs, created GSA’s premiere vehicle for integrated professional services (OASIS), managed 25 Multiple Award Schedules with annual sales of over $22 billion, supported emergency acquisitions, and oversaw acquisition for GSA Global Supply. Earlier in his career, he directed the Office of Contract Management, and played a host of both operational and policy roles.
He holds an MA in acquisition management and a BA in history and political science.
Send comments about this interview to email@example.com.
1. Editor’s note: The current GSA solution for office supply acquisition is the “third generation office supply solution” (OS3); see www.gsa.gov/portal/content/141857 for more information.
2. Editor’s note: See www.whitehouse.gov/sites/default/files/omb/procurement/memo/Myth-Busting.pdf.
3. Editor’s note: This occurs when only one bid/offer is received in response to a competitive solicitation or request for quote.
4. Editor’s note: OASIS and OASIS SB are multiple award, indefinite delivery/indefinite quantity contracts that provide flexible and innovative solutions for complex professional services. For more information on OASIS and OASIS SB, visit www.gsa.gov/oasis.
5. Editor’s note: Best value can be described as a continuum, with LPTA and tradeoff being at either ends of the spectrum.
6. Editor’s note: This award recognizes individuals working in the field of contract management and procurement that have one or more exemplary achievements that have demonstrated a measurable effect in advancing the contract management/procurement function within their respective organizations.
7. Editor’s note: For more information, and to access links to the dialogue, visit https://cao.gov/open-dialogue/.