By Steve Kelman

Blog archive

The Lectern: Buying from commercial vendors 101

One of the central tenets of the efforts to reform the procurement system in the 1990s was to make the government marketplace more attractive to companies that were not "government contractors" but primarily sold to commercial customers. The idea behind this was that predominantly government contractors took on some of the bad features of federal contracting -- such as a relative lack of performance pressure compared with the commercial marketplace -- and often had their only comparative advantage in their mastery of government procurement regulations. Getting predominantly commercial firms into the government marketplace would add to competitive pressures and bring firms into government work that were used to demands for high performance common in the commercial sector. To make the government marketplace more attractive to predominantly commercial firms, the procurement process would need to abandon as many of its government-unique features as possible and be something nongovernment contractor firms would be willing to participate in.

As procurement reform developed, the General Services Administration schedules became a prime vehicle for new vendors, often small businesses from the commercial world, into government contracting. The word spread that if you were a commercial company seeking an easy way to break into the government, the first thing you needed to do was get yourself a GSA schedule.

This approach brought in very large numbers of new businesses, and businesses new to the government, into contracting with the government. These included many innovative, niche players.

This is why the cold winds coming from
Washington
's fear industry that are blowing over the schedules are such bad news. There are now several widely publicized examples of large commercial firms withdrawing from the GSA schedules. As Federal Computer Week’s Buzz of the Week noted last week, "It is not difficult to imagine that some vendors might look at these bigger companies bailing out of the schedule program and simply determine that if the big guys can't do it, they won't even try. And federal buyers will never know what they lost."

I believe those who are creating these problems are generally honestly trying to help government and taxpayers. So I hope they will look at themselves in the mirror and consider the bad consequences for government of the current direction in which the procurement system is moving.

By the way, happy Thanksgiving to all. I will not be blogging on Thursday.

Posted by Steve Kelman on Nov 20, 2007 at 12:08 PM


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