Can a GWAC aid strategic sourcing push?

Strategic sourcing is being touted by the Obama administration as a key to lowering costs for agencies buying IT. To that end, incorporating strategic sourcing into what it can offer is a legitimate target for any contract, and the Solutions for Enterprisewide Procurement program office is taking that even further by declaring its intention to be one of the lead contracts for federal strategic sourcing initiatives. But it’s not clear yet how that will happen.

The Office of Management and Budget believes strategic sourcing will help cut down on the inefficiencies that occur in too many government contracts through which agencies can purchase commodity items that all government organization use, but whose prices can vary widely because of the multiplicity of agency-specific contracts through which they are bought. By combining those purchases through just a few contracts, the government can save a lot of money, OMB believes.

The Government Accountability Office found last year the four agencies that were responsible for four-fifths of government procurement used strategic sourcing for just 5 percent of it. By contrast, major private-industry organizations used strategic sourcing up to 90 percent of the time.

SEWP Program Manager Joanne Woytek said she and other GWAC managers from the National Institutes of Health and General Services Administration have been meeting with OMB to find out exactly what its idea of strategic sourcing is, so they can find the appropriate way to incorporate it into their contracts. It could prove an advantage going forward, she said, as agencies head into a prolonged period of budget constraints.

“It’s one of the things we’ve talked about in the GWAC world, and how strategic sourcing might help us,” she said. “If we can get in front of the agency folks and show them how this can save them money, then there [are] ways we can do that by working together.”

SEWP is working with OMB to determine the data that’s needed and how it will be tracked, she said.

Some people are not sure how it would work for solutions-based contracts such as SEWP. Larry Allen, president of Allen Federal Business Partners, sees strategic sourcing as a return to the commodity buying patterns of the 1990s, when agencies had the internal expertise to buy the separate components for IT systems and then integrate them. They don’t have that kind of expertise anymore, he said.

“There is a constituency both in industry and government that supports these contracts, and they are going to be very reluctant to give up what they see as their autonomy and the ability to get a tailored solution for what they want,” he said. “And even though the authorities might say that strategic sourcing is not supposed to be a one-size-fits-all thing, on the procurement front lines, that is what it looks like.”

There are so many “established weeds” in government procurement, and it’s hard to dig them out, he said. Strategic sourcing is just not the way people buy IT today. They buy solutions, “and that’s what GWACs are for.”

Others, however, are more sanguine. Donna Norris, SEWP IV program manager at PCMG, believes at least some focus on strategic sourcing could enhance SEWP’s attraction for agencies. Because IT products can change so quickly, she thinks the SEWP program office will probably choose to create a small section of products it can set aside just for strategic sourcing.

“It would be like going to Walmart and getting those products off a shelf, and it’s likely to be a growing area over time,” she said. “But if anyone in the government sector can set itself up to do it right, it’s SEWP.”