Stan Soloway

Let's argue procurement. It's healthy.

A few weeks ago, a little debate broke out between two of the country’s leading procurement experts — both of whom have been close friends and colleagues of mine for some 20 years.

Steve Kelman, former administrator of federal procurement policy, is a leading advocate of procurement contests and sees them as highly innovative procurement strategies that offer enormous opportunities for the government to rapidly acquire innovative solutions.

Alan Chvotkin, who has also been my partner at the Professional Services Council for the past decade, took a slightly more cautious approach. Although PSC has consistently advocated for more innovation in federal acquisition, Chvotkin also argued in a recent Washington Business Journal column that innovative strategies such as contests should not inappropriately ignore or sidestep the basic tenets of federal procurement. Kelman took Chvotkin and PSC to task for the WBJ column in his Federal Computer Week blog.

That these two icons of procurement might have a disagreement, especially one that involves relatively insignificant differences, is unsurprising — and it is healthy. Indeed, in the end, their debate is refreshing and reminds me why both are men I have long considered mentors.

There is no doubt that today’s procurement environment is generally hostile to innovation. It has actually been spiraling in quite the opposite direction. A range of external and internal pressures have increasingly limited the ability of acquisition professionals to exercise their judgment and expertise, too often driving them back to the old days when lowest cost rather than reasoned, thoughtful, best-value solutions prevailed.

As such, when innovative techniques emerge, enjoy some early successes and gain official support — as has been the case with the Office of Management and Budget's blessing of contests — it is only natural that a lot of excitement and buzz will result, especially from leading innovators such as Kelman. But successes aside, innovations such as contests don’t apply everywhere and are not without potential significant risks to the government and/or industry, a point stressed by Chvotkin.

That’s why Kelman’s advocacy for rapidly increased adoption of promising acquisition strategies and Chvotkin’s cautions about how best to proceed represents precisely the kind of balanced dialogue we need to be having.

Think about the early days of reverse auctions. I witnessed the great enthusiasm that emerged as a result of the Navy’s early successes with auctions for the procurement of commodities. However, that enthusiasm also led others to immediately begin suggesting that reverse auctions should be used across a much broader swath of the procurement spectrum.

Fortunately, thanks to dialogues like the one taking place between Kelman and Chvotkin, a more balanced approach took hold. And when strategic sourcing, which at the time was really a form of bulk buying, first gained popularity, some immediately began to advocate its use for the acquisition of higher-end services. Today’s more rational and appropriate use of strategic sourcing has resulted from a similarly thoughtful dialogue among smart folks who both know procurement and understand the need for innovation.

In other words, what makes the debate between Kelman and Chvotkin most significant is that it is a dialogue about how to make innovation work — at a time when such dialogues are all too rare. The most successful procurement innovations of the past 20 years — as one example, the emergence of commercial acquisitions under FAR Part 12 in the 1990s — have succeeded precisely because they benefited from the kind of dialogue and dissection that recently took place between Chvotkin and Kelman.

Conversely, the landscape is littered with examples of potentially effective innovative ideas that died because they were either too blithely embraced or too quickly dismissed, with little of the kind of thoughtful dialogue designed to overcome perceived or real shortcomings in ways that would enable success.

So, to my friends and colleagues, keep up the conversation and debate. By doing so, you will only help make federal procurement better and drive more successful innovation.

Reader Comments

Fri, Sep 9, 2011 Lee Spotswood

Maybe we need to go back some decades where we based price on quality, not quantity. And the 80% rule ony applied to some things, but as far as manned equipment where live's are on the line, the 80% rule is not acceptable, and quality over quantity must prevail. We taught this to Japan in the 70's and now we have seem to forgotten this ourselves.Your thought please.

Mon, Aug 29, 2011 Jon Hansen Canaa

Here is the link to an article I posted making reference to this particular article @ http://wp.me/p4HrB-2Kb

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