Kelman: The 'You're fired!' approach

Recently, I was seated at a dinner table with John Johnson, head of the upcoming Alliant contract, the General Services Administration's information technology governmentwide acquisition contract. We started talking about how Alliant could increase the value it offered federal customers and, hence, its attractiveness during a time when GWACs are facing increased scrutiny and competition from other vehicles.

I’m don’t exactly remember how the idea first came up -- it doesn’t really matter -- but we talked about a thought John soon dubbed the “You’re Fired!” strategy (from the TV show, “The Apprentice”).

The basic idea would be this: GSA chooses Alliant winners. After contracts are awarded, GSA collects past performance report card ratings on each task order in the contract. Following a period of time, it terminates the vendor(s) with the poorest past-performance ratings, and opens the competition again to replace the departing vendor(s) with new ones. After the first cycle, the same process is repeated for each year of the contract. Thus, remaining on the contract are only the best of the best. And the desire to stay on contract in the first place will improve performance levels of all the GWAC holders.

Johnson hasn’t decided yet whether GSA will use this approach for Alliant. I hope they do. (If GSA or any other agency does this, they would obviously need to announce their intention in the initial request for proposals for the contract.)

The conversation itself, however, reveals two interesting things about our procurement system right now. The first is that the easy days for GWACs and the GSA schedule contracts are over, and those managing these vehicles need to give serious thought to how to make them more valuable to agency customers.

In my view, GWACs and schedule contracts are extremely valuable parts of the procurement system. Because they have streamlined ordering procedures, obviously, they make it easier to get quick access to vendors to help with needed agency missions. Beyond that, the ease of getting on contract also means it is easy to change vendors if they don’t perform well, and easier to do modular contracting, both of which are good for the government.

Furthermore, the competition these vehicles provide agency procurement shops and the possibility of adding contract personnel to an undermanned system are also good.

But GWACs and the schedule contracts got themselves -- and the government -- into trouble by tolerating too many de facto sole-source awards for too long, and other problems.

Now these vehicles need to think creatively about new ways to create value. This may involve offering more contract management services. It may involve more help crafting performance-based, or share-in-savings, or other kinds of complex contracts. It may also involve approaches such as the one John Johnson is considering for Alliant.

The second message from my dinner conversation was that, despite the vicious pressures beating on government employees to retreat into their shells and stop thinking, we are still blessed with many John Johnsons. They refuse to hand in their brains. They refuse to hand in their hearts. They continue to try to find ways to get agencies best value through contracting. They deserve our gratitude and support.

Kelman is a professor of public management at Harvard University's Kennedy School of Government and former administrator of the Office of Federal Procurement Policy. He can be reached at steve_kelman@harvard.edu.

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