OMB requires strategic sourcing

OMB memo on strategic sourcing

Related Links

Expect more bulk buying for federal acquisitions following a new Office of Management and Budget memo requiring agencies to use strategic sourcing for at least three commodities.

Under this new guidance, agency chief acquisition officers have until October 1 to identify three commodities ripe for acquisition on an agency-wide basis. The idea is to use an agency’s buying power to lower costs and increase performance, among other goals, according to the OMB memo. The three commodities cannot include software that could be purchased under SmartBuy, an existing program to buy enterprise-wide licenses. Already undertaken strategic sourcing initiatives do count, however.

The memo directs chief acquisition officers to work with chief information officers and chief financial officers to develop a strategic sourcing plan and establish an agency-wide strategic sourcing council.

In addition, starting in January of next year, acquisition officers will report to OMB’s Office of Federal Procurement Policy the cost reductions and agency improvements achieved thanks to strategic sourcing. Agencies will be required to develop a methodology for formulating baseline data.

The federal government spends about $300 billion each year on goods and services but could save money through a more collaborative and structured buying process, according to the memo.

About the Author

David Perera is a special contributor to Defense Systems.


  • Defense
    Soldiers from the Old Guard test the second iteration of the Integrated Visual Augmentation System (IVAS) capability set during an exercise at Fort Belvoir, VA in Fall 2019. Photo by Courtney Bacon

    IVAS and the future of defense acquisition

    The Army’s Integrated Visual Augmentation System has been in the works for years, but the potentially multibillion deal could mark a paradigm shift in how the Defense Department buys and leverages technology.

  • Cybersecurity
    Deputy Secretary of Homeland Security Alejandro Mayorkas  (U.S. Coast Guard photo by Petty Officer 3rd Class Lora Ratliff)

    Mayorkas announces cyber 'sprints' on ransomware, ICS, workforce

    The Homeland Security secretary announced a series of focused efforts to address issues around ransomware, critical infrastructure and the agency's workforce that will all be launched in the coming weeks.

Stay Connected