IBM dust-up ripples through government

The federal procurement system is the largest and amongthe cleanest public-sector procurement systems in theworld. It counts transparency and competition as its highestvalues.It also gives a single agency debarmentofficial an unchecked ability to completelyhalt a company's business across the federalgovernment. In the event a single companyemployee, out of tens of thousands, is givenor receives competitive information duringthe procurement process, a federal suspensionand debarment official can suspend theentire company without notice and withoutfully considering the impact on other federalagencies.IBM found itself in this situation March 27when an EnvironmentalProtection Agency debarmentofficial posted IBM's name onthe Excluded Parties ListSystem, halting sales of IBMproducts and services.Contracting officers are instructed to checkthe EPLS before awarding contracts or issuingorders to verify that the company withwhich they are about to perform a contractaction is not on the excluded-parties list.Companies and individuals can be placed onthis list with scant notice. IBM first learnedof its suspension through a third party.The purpose of the suspension anddebarment system is to protect the governmentby preventing contracting officersfrom continuing to do business with a companysuspected of illegal or fraudulentbehavior. The EPLS includes more than66,000 names of individuals and companies,mostly small businesses, so it wasbig news when a company the size and reputationof IBM appeared on the list.Because IBM is also a manufacturer ofcommercial products, this action immediatelyimpacted the operations of other federalagencies. Contracting officers from agenciesin the process of routine buying, updatingand upgrading IBM hardware and softwarecouldn't determine whether orders for IBMproducts could be placed with IBM resellersvia non-IBM contracts or not.The General Services Administration'sguidance on the matter blew one way andthen the other. A week later, the high dramawas over, and IBM's name was removed fromthe EPLS. But in the process, $10 million to$20 million worth of IBM product sales weredelayed; some agencies had begun developingcontingency plans.The far-reaching, and I suspect, unintended,consequences caused by the EPA's suspensionof IBM reminds us that a few governmentemployees have the power to effectivelyput a company out of business with the federalgovernment while causing other agenciesimmediate hardship.Government procurement watchdogs seemto be encouraging more widespread use ofthe suspension and debarment tool. Forinstance, the proposed Contractors andFederal Accountability Spending Actwould use suspension and debarment toprevent repeat offenders from continuingto do business with the government.My concern is the process behind theuse of this unchecked and possibly arbitrary,if not capricious, authority.I have two suggestions: First, a suspensionor debarment official should berequired to fully consider how the intendedaction would affect theoperations of agencies thatdepend on products manufacturedby the accused.This would make theprocess a bit more business-like and, hopefully, less disruptive toother agencies.Second, there ought to be a use-it-or-lose-itlimit on how long the government can siton evidence of wrongdoing before makingcharges.For example, the government puts the burdenon contractors to file sustainable protestactions within 10 calendar days of when thecontractor knew, or should have known, ruleswere violated.Why not hold government employees tothe same 10-day timeliness standard afterwhich they would lose the right to usethat information to suspend or debar acontractor?