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By Steve Kelman

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Why is GAO's glass so often half empty?

I saw a reference in the contracting trade press to a recent Government Accountability Office report on acquisition planning for service contracting, Acquisition Planning:  Opportunities to Build Strong Foundations for Better Services Contracts. For non-contracting cognoscenti, "acquisition planning" is the first stage of the procurement process, before source selection and contract management, where an agency develops its requirements and performance standards (including learning about what the market has to offer), picks its preferred contract type and sets its buying strategy. The report was based on an analysis of 24 service contracts awarded by the Homeland Security and Health and Human Services departments, NASA, and the U.S. Agency for International Development in fiscal years 2008 and 2009.
Contracting experts generally regard acquisition planning as quite important, but also deeply troubled. In the years when the contracts GAO examined were awarded, staff shortages and what is sometime perceived as a rush to award the contracts, made planning even more of an issue than it had been.

The account I read in the trade press discussed shortcomings in agency acquisition planning efforts that the report revealed. One headline found in the actual report was: "Agencies Missed Opportunities to Build Strong Foundations for Services Contracts."
Given all this, I was actually quite surprised when I read the report to see that practice on the contracts examined was better than I would have expected, much better than I would have feared. It is often suggested that agency service contracts routinely have terrible or virtually non-existent requirements because little effort was put into defining the agency's needs. However, the report found this to be the case in only five of the 19 contracts for which written acquisition plans were required. In these cases, this seemed to be because, by the report's own admission, "agency requirements were difficult to define" -- as anyone with experience in contracting knows occurs with some frequency in the real world.

Performance on advance cost estimation was not as good, though even here one-third of the contracts had cost estimation that met GAO's standards, and all but two of the others had cost estimation that GAO regarded as incomplete. (As the report itself notes, although advance cost estimation does serve a function -- particularly in signaling to an agency that the level of performance it wishes may be too expensive to buy -- competition for the contract reveals lots of information about costs. If agencies used the request for information process better than many do, they could get more information about overly expensive requirements from potential bidders.)

Finally, for half the follow-on contracts for which written acquisition plans were required, the plans included lessons learned from the previous contract to be incorporated into the re-competition, and the report notes that in a few other cases where this did not appear in the written plan, officials nonetheless were able to give examples of how they had incorporated lessons learned into the new solicitations.
I have two reactions to all this. One is that I actually finished the report feeling somewhat better about the state of the contracting process than when I started. These agencies are by no means doing a perfect job, but, especially given resource shortages, they're not doing so badly either. The second reaction was:  why is the glass in GAO reports always half-empty? Why wasn't this report titled, "Agencies Making Progress on Acquisition Planning?" We shouldn't always be dumping on ourselves.
So that I don't fall victim to my own "half-empty" criticism, I should add that GAO reports in general do have a less negative and dour tone than Inspector General reports typically have – for IGs, the glass is usually bone dry. But the tone of GAO reports is inferior to reports I have read of the GAO's UK counterpart, the National Audit Office, which typically highlight examples of good practice as well as of problems.


Posted on Sep 06, 2011 at 12:09 PM

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