How DHS’ acquisition oversight strategy is picking up steam

Homeland Security Department management said they're now requiring documentation and life cycle cost estimations for all major acquisition programs. It's a big ...

The Homeland Security Department’s acquisition strategy is earning some praise and pointers from the Government Accountability Office.

For the first time since GAO began its annual review of major DHS acquisition programs, all 26 had an approved baseline, according to a new report. More than half, or 17 of the 26, were on track to meet some of its deadlines and cost goals. Seven of the 17 only recently met these milestones.

Yet the remaining nine programs slipped on its scheduling, and four of them experienced some cost overruns.

But it’s still a big step for the department, which in the past, didn’t require documentation from its major acquisition projects and didn’t evaluate life cycle costs and review them on an annual basis.

That’s changed now, Chip Fulghum, acting undersecretary for management at DHS, said during a panel discussion with the department’s C-suite at an AFCEA D.C. breakfast Apr. 6. But Fulghum and his team recognize the department still has more progress to make.

Over the past two years, DHS has completed full reviews of 50 major programs.

“No GAO report would be complete without the ‘but,’ and there’s more work to do, which is true,” Fulghum said. “But we’re pretty proud of that.”

For the first time,  seemingly disparate communities are beginning to talk to each other. In the past, program and acquisition managers never spoke to the CFO office, Stacy Marcott, acting chief financial officer for DHS, said.

“[We’re] making sure that when a program comes forward for a program review or a milestone review that that CFO of that acquisition program is sitting at the table and has signed a memo over to us that says yes, we can afford what the cost is of this program before we move forward and it’s appropriately priced,” she said.

The chief financial officer has a direct line of vision into how these cost estimates measure up to the department’s budget process.

The department has been testing a relatively new acquisition strategy on five pilot programs. But DHS recognizes it needs to scale it across most of the other major programs.

“We’ve seen some improvements, we’ve seen that it can work, but now we have a whole list of learnings though this process that is going to inform recommended changes to various areas of policy, process and guidance,” said Michael Hermus, chief technology officer for DHS. “We do have a long way to go. We’re going to create action plans and implementation plans to make those changes, but it’s going to be a lot of work.”

Nicole Ogrysko discusses this story on Federal Drive with Tom Temin

Soraya Correa, DHS’ chief procurement officer, said the department’s approach to acquisition oversight is beginning to chip away at some longstanding and deep cultural barriers.

For example, a new program awards “digi-badges” to those employees who are putting into practice what they are learning about using digital services to improve DHS’ mission. Correa also runs the Acquisition Innovations in Motion initiative and Procurement Innovation Lab.

When she first entered her current position, she surveyed the DHS acquisition community. Roughly 70 percent of the community said fear and cultural resistance stopped them from trying something new or different.

“It’s not just about cost savings,” she said. “It’s about making sure that we’re using our resources smartly. A lot of people like to talk about the savings in the contract, I like to talk about the savings on the administrative side. If I can free up my CTO, my CIO to be out there solving the real problems, that’s what I want to do. I don’t want them spending a lot of time just on the procurement. I want them out there getting the real work done.”

Yet GAO still finds some risks and challenges with DHS’ approach.

The department needs to better document when DHS leadership makes a decision about one of its acquisition programs and should focus more closely on the details.

“DHS approved six programs to proceed through the acquisition life cycle even though required documentation was not comprehensive or had not been approved, as required by DHS policy,” GAO said. “Senior DHS officials told GAO those decisions were also based on discussions held at the programs’ formal acquisition reviews, but these considerations were not documented. Federal internal control standards require clear documentation of significant events. DHS leadership’s decisions may be reasonable, but unless these decisions are documented, insight for internal and external stakeholders is limited.”

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