Category management means vendors should shift their strategies

The General Services Administration is in the midst of several major initiatives that are designed to streamline acquisition processes for government buyers, help agencies adapt to emerging technologies and, above all, lower costs.

Speakers at Washington Technology GSA Industry Day on Wednesday hit these themes repeatedly whether they were talking about cloud computing, cybersecurity, X-as-a-service or commodity hardware buys.

Some of the initiatives include the recent Salesforce BPA and ongoing efforts to consolidate PC and laptop purchases to comply with Office of Management and Budget guidance. Other initiatives are focused on dropping the two-year corporate requirement to pave the way for more small businesses to enter the market.

GSA also is in the midst of creating a special item number for health IT on Schedule 70. They also are working on changing existing SINs that deal with cybersecurity and information assurance.

All of these initiatives will require vendors to adapt their selling practices. Arching over these initiatives is category management, the government's effort to gain a better understanding of how and what it buys. GSA is leading much of the category management efforts.

As Kay Ely, director of the Office of IT Schedule Programs, described it, category management has GSA looking across government and examining how they are buying, what they are paying and how they can become more efficient consumers. And, of course, a major component is leveraging the government’s buying power.

All of that should sound familiar. The Office of Federal Procurement Policy put out a memo on it in December 2014 describing category management.

But Ely and a later speaker, Chris Fornecker, also spoke about how industry needs to look at category management and how it should influence their approach to the market.

Ely said that only one of the 10 categories in category management is IT, but she recommended that IT companies pay attention to the other nine.

As a reminder the 10 categories are:

• IT
• Professional Services
• Security and Protection
• Facilities and Construction
• Industrial Products and Services
• Office Management
• Transportation and Logistics Services
• Travel and Lodging
• Human Capital
• Medical.

Many companies bring a contract vehicle approach to the market in that they have a vehicle and convince customers to buy through it. What they should be doing is looking at the categories and seeing how they can help their government customers address those needs.

Ely recommended that companies look at their lines of business and see how they match up with the 10 categories.

The government is trying to become subject matter experts in these areas so they can buy them more efficiently and more economically, she said.

Ely said it would be smart for companies to get to know the category managers at their agencies because it will help them anticipate where the agency is headed and better address specific needs.

Another theme that was repeated often was the need for data, especially information about the prices agencies are paying for technology.

They want to know about pricing trends, how prices are set and what is a fair price.

ESRI willing shared that information with GSA as it negotiated changes to its geospatial schedule, including leveraging the government’s buying power to lower prices. The benefit to ESRI, according to Giovanni Onwuchekwa, branch chief of programs and analysis, who worked with the company, was a streamlined process and lower administrative costs for its schedule.

While the GSA officials were coy about saying where they will next apply this approach, more of these kinds of deals are coming, they said.

The best advice is to study category management and understand FITARA, which is driving many of these requirements.

Since many of these initiatives are driven by a law, they are more likely to outlive a change in administration next year. The name may change from category management to something else, but it looks like the initiatives themselves have long legs.