The 70 percent solution

The announcement that President Bush has nominated Angela Styles to be administrator at the Office of Federal Procurement Policy is good news. OFPP has lacked political leadership for almost a year, and one can only hope that the Senate will promptly confirm her.

Styles has a relatively narrow background in terms of procurement policy. She has been a private-sector lawyer representing defense contractors in disputes with the government over payment issues, many involving cost- reimbursement contracts and interpretations of the government's Cost Accounting Standards.

This background suggests the challenge Styles will face as she assumes her duties. In my view, in about 70 percent of issues involving procurement policy, the enlightened interest of the government (read: the taxpayer) and of contractors is the same. Another 15 percent involves situations where a policy is in the interest of the government and either is a matter of indifference to, or may hurt, many or most contractors.

For example, although some revisions to Part 15 of the Federal Acquisition Regulation several years ago were in the interest of government and contractors, other parts increased the government's bargaining power and were not greeted with joy by many contractors.

This analysis has several implications. The first is that the sweet spot for procurement reform has been and is in the 70 percent of issues where the interests of government and industry coincide. Reform was possible in the 1990s because of an alliance between government and industry representatives who realized that, for example within the information technology arena, the old order of noncommunication, low-bid source selection, long lead times and bid protests was destructive for everybody.

To succeed at her job, Styles will need to cultivate the ability to look for areas of common interest, not one-sided industry advantage.

This analysis also suggests where Styles might go wrong. A government representative must focus on the 70 percent of common interests but also must prepare to advocate the taxpayers' interests where industry might be indifferent or critical. Styles has little experience doing that.

Obviously, that doesn't mean she can't or won't cultivate such skills. But she needs to ensure that she does so by listening carefully to career members of the FAR Council and to agency procurement executives for guidance.

The nightmare scenario would be an administration procurement policy that focused on the remaining 15 percent of issues on an industry wish list while ignoring taxpayer concerns. That would produce partisan polarization of procurement policy. And it could also produce contractor scandals that would ignite calls for re-regulation and break up the industry/government alliance that has improved the system.

I'm definitely not predicting this will happen. Styles will do a good job. But I also believe she should be forewarned so she can be forearmed.

Kelman, administrator of the Office of Federal Procurement Policy from 1993 to 1997, is Weatherhead Professor of Public Management at Harvard's John F. Kennedy School of Government.


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