Feds question Seat Management

Despite the buzz surrounding the General Services Administration's award of the Seat Management contract expected this week, some agency representatives said they have doubts they would use the contract.

The Seat Management contract, like the Outsourcing Desktop Initiative for NASA contract awarded earlier this month, was designed to revolutionize the way agencies procure information technology. The contracts essentially outsource users' desktop systems and call on vendors to provide and maintain the hardware, software and networks users need to do their jobs.

But some potential users said they have strong reservations about seat management, including concerns surrounding irregular budgets, property transfer and the risk of turning desktop management issues over to a third party, such as GSA.

Mark Boster, deputy assistant attorney general for information resources management, said the Justice Department, which has an annual IT budget of more than $1 billion, would probably shun the GSA and NASA contracts. "I think it would be highly unlikely that [DOJ] would use a GSA contract or a contract from any other agency," he said. "We would not want to be a third party on such an important contract."

Charlie Self, GSA's assistant commissioner for IT integration, said his agency's Seat Management contract eventually will allow agencies to manage their work directly with vendors. But he said GSA wants to gain some experience with its seat management vendors before allowing that.

Apparently, the Army also wants to take seat management matters into its own hands, announcing last week that it had awarded three blanket purchase agreements for seat management and leasing services associated with products available on its Small Multiuser Contract II, the Personal Computer II contracts and the Portable II contracts.

Maj. Stephen Sharkey, product leader of the Army's small-computer program, said the service chose to pursue its own contracts because of concerns that other contracts would not be able to address the Army's overseas requirements or its need for quick emergency response.

The BPAs, worth about $250,000 each, were awarded to Government Technology Services Inc., Telos Corp., and Vanstar Government Services Inc., which were the incumbent contractors on the three programs.

Agencies expressed far-ranging concerns about using the GSA Seat Management program.

Boster said he would be extremely concerned about entering into a seat management agreement with a single vendor and potentially "locking into performance problems." He said such an arrangement also would mean giving up the ongoing competition the department could achieve through multiple-award contracts.

In addition, Boster said DOJ would have to run seat management vendors through extensive "five-year, full-field background checks" to ensure that the department's sensitive "life-and-death" information would remain safe.

He also rejected one of the primary arguments in favor of seat management: that it can overcome the problem of federal desktop technology becoming antiquated. "I do not buy the idea that our tech-refresh cycles are too long," Boster said. "I think that is techie rhetoric."

Neil Stillman, deputy cnformation officer at the Department of Health and Human Services, said seat management sounds great on a conceptual basis, but it "may have some problems" on a practical basis.

Stillman said administrative offices, such as those at HHS, do not have guaranteed funding streams. If Congress decides to cut an administrative office's budget, it could threaten the office's ability to meet monthly leasing payments, he said. "My computer may be outdated now, but I own it," Stillman said. "With seat management, my computers may be removed; I would have nothing."

A Department of Veterans Affairs spokesman said tricky issues, such as transfer of property— determining who is legally responsible for equipment when it needs to be taken off site for repairs— may keep the VA from embracing seat management on a broad scale.

Moreover, the VA, which also spends more than $1 billion a year on IT, traditionally has not embraced IT outsourcing and already has established IT help desks and maintenance operations, he said.

"There will be some interest; how much is uncertain," the spokesman said. "There will probably be more at the facility level, at the hospital level, where it is more likely to be easier to have an independent contractor manage your systems."

Self said the concerns raised by potential users of Seat Management can be overcome. He said the sheer convenience presented by contracts that free agencies from the need to ensure software compatibility, network connectivity and smooth IT operations should make the contract popular. "Desktop operations today within the government are horrendous," Self said. "I think industry is going to be able to do a lot better."

John Okay, senior vice president for telecommunications and special studies at Federal Sources Inc. and the former deputy commissioner of GSA's Federal Technology Service, said seat management contracts will require agencies to do a lot of adjusting in the way they think about IT management. "It will take an effort to educate managers on what this means," he said.

Okay said vendors will not be able to use a template that can be applied and tweaked a bit for each agency buying outsourcing services. But Okay still thinks this is a big business opportunity in the federal market. Federal Sources is developing a major seat management program to help agency IT managers know how to buy seat management services.

Despite their reservations, most federal IT executives said they remain open to using seat management. But several agencies said they would rather wait before embracing the concept.

"Our take is probably a conservative one," said Eugene "Kim" Taylor, acting CIO at the Transportation Department. "We are going to watch and see how it goes in terms of how the [contractors] perform and whether there are indeed economic advantages."

Candace Hardesty, assistant director of strategic planning and program administration at the Treasury Department, said the department is generally interested in the concept, largely because of the success that the Bureau of Alcohol, Tobacco and Firearms has had with its seat management contract, which was awarded last October to Unisys Corp.

Patrick Schambach, CIO at ATF, said the bureau's experience with seat management, although not without hitches, has been instrumental in updating aging systems. But Schambach's experience also brings into question another business argument cited by some supporters of seat management: that it will save money. "From a raw equipment standpoint, it costs more," Schambach said. "We're spending more money than we used to, but we've gone from a poor situation to a great situation."

-- Allan Holmes contributed to this article.