The successes of the Buyers Club at the Department of Health and Human Services and the Procurement Innovation Lab (PIL) at the Homeland Security Department are paving the way for widespread adoption of these “innovative” approaches.

So much so that agencies now have until May 2 to set up similar organizations or describe existing structures that meet the same goals of acquisition innovation labs.

Anne Rung, the administrator in the Office of Federal Procurement Policy, and Tony Scott, the federal chief information officer, sent a memo to all CFO Act agencies detailing the requirements for the new labs as well as announcing a pilot to expand the use of digital acquisition capabilities across the government.

“These new labs will provide a pathway to test and implement more innovative approaches to acquisitions, with a strong emphasis on improving IT investments,” wrote Rung and Scott in a March 9 blog post. “They would also help agencies successfully adopt emerging acquisition best practices to more effectively deliver services to the American people.”

Rung and Scott said the labs should start small and grow over time.

The Office of Management and Budget is giving agencies an initial deadline of March 31 to identify a senior official in charge of the innovation lab.

Then over the next month, OMB wants agencies to set up the lab with a goal of providing “a clear pathway to test and document new acquisition practices and facilitate fresh perspectives on existing practices and help programs and Integrated Project Teams (IPTs) successfully execute emerging and well-established acquisition practices to achieve better results for the taxpayer.”

Rung and Scott said the lab may provide the acquisition workforce with additional training by providing a space for hands-on, real-time experiential learning.

“Agencies have wide latitude in structuring their acquisition innovation lab and addressing associated personnel staffing issues (e.g., its sponsors, and the type and amount of dedicated personnel). For example, an agency may wish to use the lab as an extension of the IT acquisition cadres they have been standing up in accordance with [the] Federal IT Acquisition Reform Act (FITARA). The lab might provide internal consultation for its own workforce, such as 18F Consulting offers for those that currently lack such expertise,” the policy stated. “Alternatively, the lab may function as a supporting arm of the agency’s chief acquisition officer (CAO), senior procurement executive (SPE), or CIO. Agencies should coordinate with their agency’s other innovation labs, sometimes known as Idea Labs, and innovation councils in creating or strengthening their acquisition innovation lab.”

OFPP announced intentions last year

OFPP signaled its plans to require a Buyers Club in every agency last June based on the success and momentum by HHS, DHS and others.

HHS, for example, stood up a Buyers Club in 2014 and have been using non-traditional approaches to solve agency problems.

DHS stood up the Procurement Innovation Lab in 2015 with the idea of giving acquisition workers some leeway to take chances.

The administration has wanted to expand the use of digital services and acquisition practices over the last 18 months.  In the fiscal 2016 budget request, President Barack Obama asked for $105 million for digital services and proposed the creation of new Idea Labs to support federal employees with promising ideas and improve agency functions. Commerce, Education, Treasury, the General Services Administration and the Small Business Administration would pilot this concept to create “a culture of innovation that yields results.”

Congress didn’t fund the digital services request and it’s unclear whether the five agencies piloted the Idea Labs.

Still, OFPP moved forward with its plan to get agencies to set up Buyers Clubs.

Even without a steady funding source, OMB is encouraging agencies to adopt specific best practices, such as use of prototyping from industry to test out ideas or concepts, or the use of challenges or contests to pay for innovations.

The memo also highlights six general considerations when standing up the innovation lab, and six ways the innovation labs should help other offices in the agency.

As for the digital acquisition innovation lab pilot, OFPP, the U.S. Digital Services Office, 18F Consulting in the General Services Administration and a team of Presidential Innovation Fellows are creating a place for agency teams to receive coaching and training to accelerate the development of digital acquisition capabilities.

“Each agency participating in the pilot will identify one or more teams with cross-functional support (e.g. architecture/engineering, user research and experience design, product strategy, acquisition, data management) to receive coaching on digital services acquisition from USDS and 18F Consulting for at least two acquisitions within their agency,” the memo stated. “In return, the agency will dedicate the team or teams to provide ongoing internal lifecycle support for other agency IPTs to expand the agency’s ability to conduct digital acquisitions.”

EPA testing acquisition lab

Additionally, OMB said these agency teams should commit at least 75 percent of their time during the 6-month pilot on working in the lab, and the team should be ready to begin work within 30 days of signing off on a memorandum of understanding.

“The CIO and CAO and members of the team must follow the principles in the U.S. Digital Services Playbook,” the memo stated. “Agencies must allow USDS and 18F Consulting to lead one pilot acquisition, and coach the other pilot acquisition. All final decisions that would bind the agency, such as selection of the contractor, will be made by the agency.”

OMB said the Environmental Protection Agency already is an early adopter, having recently launched a digital services acquisition lab with technical acquisition support from 18F Consulting.

EPA plans for the lab to manage multiple acquisition vehicles for rapid modular buying using the Digital Services Playbook and TechFAR. The lab will also provide request for quote (RFQ) and request for proposals (RFP) writing services for EPA programs and potentially for other agencies as it builds expertise.

“The greatest catalyst for innovation is each agency’s willingness to embrace a culture that continuously encourages new ideas and finds better applications of existing practices,” Rung and Scott wrote. “Establishing Acquisition Innovation Labs governmentwide will play an increasingly important role in empowering and equipping agency employees to implement their promising ideas and foster a culture of innovation that leverages proven government and private sector practices.”

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