How the boost in federal contracting with small and disadvantaged businesses will actually happen

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The Biden administration has been pushing for more federal contracting dollars to go to small and disadvantaged businesses. The specific goal is for an additional $100 billion to such businesses over the next five years. For how agencies can start to reach this goal, the Acting Director of the Office of Federal Procurement Policy, Lesley Field spoke...

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Best listening experience is on Chrome, Firefox or Safari. Subscribe to Federal Drive’s daily audio interviews on Apple Podcasts or PodcastOne.

The Biden administration has been pushing for more federal contracting dollars to go to small and disadvantaged businesses. The specific goal is for an additional $100 billion to such businesses over the next five years. For how agencies can start to reach this goal, the Acting Director of the Office of Federal Procurement Policy, Lesley Field spoke to the Federal Drive with Tom Temin.

Interview transcript:

Tom Temin: Ms. Field, good to have you back.

Lesley Field: Hi Tom, thanks so much for having me.

Tom Temin: And just if you would briefly review some of the parameters because there are percentages for small businesses, and then there are percentages for [SDBs] within the small business ranks.

Lesley Field: Exactly. So according to SBA’s scorecard, the federal government spent $145 billion in fiscal year ’20 with small businesses. So that equates to about 26% of eligible dollars. A subset of these awards go to small disadvantaged businesses, or SDBs. And in FY ’20, that was almost over $59 billion and about 10%. So that helps to sort of understand what those numbers mean. But agencies are also working to meet or exceed their goals for the other socioeconomic small businesses, such as women-owned small businesses, service-disabled veteran-owned small businesses, and of course, contractors and HUB Zones.

Tom Temin: Got it. And so I’ve spoken to some agencies that are already above that 26/10. I think Homeland Security is like 35/17. So we know what’s possible. And what is your feeling having watched procurement all these years? What are some strategies agencies can use to get to those higher numbers if they’re not there already?

Lesley Field: So we’ve got lots of tools and guidance out there. And I think they’re really a couple of means that we are looking at with respect to the increased goals that the president has set. And I think they’re focused really in two areas: Data and engagement. And we’ve been working with experts in SBA, GSA to better understand how we can use existing information and maybe new information about small businesses in the U.S. economy to support the increase in new entrants that we’re really looking for. So we need common definitions for that, we need better forecasting tools, and we need to provide better information to the marketplace so they know what we’re looking for. And they will be anxious to do business with us. And so we’re not really just looking outside, but the suppliers who need the information, they need really better forecasting tools. Every agency needs to do procurement forecasting. What we did find when we were working with our industry liaisons that those tools were sort of varied, we want to make sure that they’re quality tools, and the information is easy to find so that those opportunities reach all of the marketplace.

Tom Temin: Is it possible for the procurement dollars and the spending dollars that agencies gather under the DATA Act, or in theory, they do and have been for quite a number of years, can that somehow be tied to the Federal Procurement Data System, so that you can match up where the dollars are going?

Lesley Field: So the Federal Procurement Data System (FPDS) feeds USASpending. And so we are looking, if you read our recent memoranda, we are looking at ways to make that information [on] USASpending a little bit more user friendly, so that the information is more usable. And that’s part of a larger strategy that we’re looking at around high definition acquisition. And so that data is critically important. We’ve heard that from agencies, and we’ve certainly heard that from the small business community.

Tom Temin: But that can help you drive more dollars to existing contractors. I think the spirit of this though, is also to bring more companies that we’re not doing business with at all, or may not even be aware of into the federal market.

Lesley Field: Exactly. And so we were looking at the data just to make sure that we were reaching, perhaps folks that had not done business with us. But we also really encourage engagement. We’ve talked about our myth busting series before that. Industry outreach can be critical, especially in attracting new entrants to the market. We also want to make sure our small business specialists and our team at SBA are engaged. We also want to focus on Ability One, to identify opportunities to increase employment for persons with disabilities. So we are looking at data driven outreach just to make sure that we’ve got online dialogues and crowdsource activity so that we can look at what the industry and what the marketplace is saying, and then using supplier feedback surveys, right? So once we get some new entrants into the market, and even with existing entrants, we can use our Acquisition 360 tool to find out how that experience went so that we can make improvements if necessary.

Tom Temin: And what about the idea of maybe training contracting officers to help new entrants not feel like they’re facing the most complicated thing ever invented by humankind, which is doing business with the federal government?

Lesley Field: It can be formidable, and it does take a team. So we’re looking at building a procurement equity network. So of course, it includes the contracting team and the program managers as it always has been. But we want to bring in our industry liaisons that were appointed a few years ago. We want to bring on our small business specialists , our acquisition innovation advocates to help us use more flexible and more business friendly practices, right, so folks will want to do business with us. We want to bring in our Ability One reps and our category management team. So when you think about the team it takes to run an acquisition we want to bring in some new voices so that new entrants and perhaps folks who have thought about doing business with us but haven’t feel that they’re supported and provide them the information that they need to make that decision.

Tom Temin: We’re speaking with Lesley Field, acting director of the Office of Federal Procurement Policy. And what about the big, famous and very popular and refreshed governmentwide acquisition vehicles such as operated by GSA, NIH and the rest of them? A CIO-SP, NASA has them, can they somehow be bent to this effort?

Lesley Field: So GSA, NIH and NASA, all the GWAC holders have been and will continue to be key strategic partners. And we brought them in to help us run the newish governmentwide IT vendor management office, which serves as a resource to agencies for acquisition intelligence, data, supplier relationship tools, all those kinds of things. But the [IT vendor management office] has initiated a couple of efforts to break down those small business barriers. They posted webinars to share information on category management on IT acquisitions, on the IT governmentwide contracts, cybersecurity, supply chain risk requirements so doing, again, more outreach, more targeted outreach, it can be incredibly helpful. In addition, those vehicles need to demonstrate how their best in class, or big solutions are supporting small businesses as part of their semi-annual review. So it’s always a focus. For example, the 8(a) STARS program is a terrific example of how we can advance equity and build support for the underserved community while practicing good stewardship. And I think over the last 10 years, the STARS program has supported over $15 billion in agency orders to small disadvantaged businesses, and they have over 400 highly qualified SDBs for a wide range of services. So they can be terrific places for these SDBs to start and to thrive there. Because we also want to make sure that they are building a resilience as they go. So this is a terrific way.

Tom Temin: And the rise of professional services has brought a lot more minority-owned businesses into the fold, because there’s less capital requirement to start up a company like that relative to say making gyroscopes or something high tech manufacturing. So is it your sense that this whole initiative of increasing the percentage of dollars going to small and disadvantaged companies can also extend to manufactured goods as much as professional services?

Lesley Field: Absolutely. And I think this initiative is really meant to cover the waterfront of all the things that we buy. The government, we’re the largest buyer in the world, we buy everything. So we want to make sure that those opportunities are available to a wide marketplace. And so we encourage agencies to consider ways to engage with other underserved groups such as individuals with disabilities, historically Black colleges and universities and minority serving institutions to promote supplier diversity throughout. For whether it’s common requirements or whether they are unique to certain agencies, we want to provide sort of a breadth of experience. And there are certainly lots of opportunities out there. But again, I think our outreach and our data and train the workforce and making sure everybody has the information they need is going to be key to doing that.

Tom Temin: And having only read the first 47 pages of all of the initiatives here, let me ask, does the subcontracting done by large prime contractors, that also counts here, right?

Lesley Field: So subcontracting does count. Well and it does count, I think, in gaining experience and creating those partnerships. And it really is a great way to do business development and again, form those alliances. We’re always looking for ways to strengthen this. And the goals, of course are at the prime level. But subcontracting is a very important step. And it’s an important part of business development and resilience. And so we are always looking at ways to improve how that’s measured, how those opportunities are made available, what the communication strategy looks like. So again, an important part of it. But these schools are focused on them prime contracts.

Tom Temin: And are you advising agencies to keep their requirements as strict as they need for their mission, and not to alter requirements or lower requirements solely for the purpose of bringing in a new company? But you’d rather have companies rise to the level of the requirements?

Lesley Field: Exactly. Well, we want to make sure that their requirements are written properly to promote competition, right, we’ve always been advocates for that. So making sure that we’re not being too restrictive unnecessarily. But we have found that the innovative business practices that the Procurement Innovation Labs, such as the PIL over at DHS are supporting, can help us think through whether those requirements are necessary, whether they need to be refreshed, based on new technology or new ways of doing business. And so there are lots of ways to have the marketplace to help us think through those requirements before we put them on the street. And whether those are industry days or supplier conferences there are a number of strategies for making sure that those requirements are written properly so that they maximize competition to the extent that’s possible. So I think we want to make sure that we’ve got that team that we talked about engaged right up front to make sure that those requirements are really what they need to be, to promote the widest range of competition.

Tom Temin: And just a final question returning to that idea of the procurement equity network, almost sounds like a game show. Just who’s on that and is it a virtual thing?

Lesley Field: We’re building strength in the agencies. And so the equity network as we think about it, and of course, as we get more experienced with this will probably bring in some more voices. But the industry liaisons are important too. That’s a fairly new position in the agency. The small business specialists which they have provided a valuable resource throughout. So they’re part of the team. But we’d like to bring in the acquisition innovation advocates, again, bringing in new ways of doing business within the flexibilities that the FAR allows. Our category managers know a lot about the marketplace. So let’s bring them in at the appropriate time. And of course, the contracting team, your program manager, your contracting officer contract specialists and your car. So bringing all of those folks together, whether it’s part of an acquisition services workshop, and making them connected at the beginning, so that our strategy really reflects what the marketplace can deliver.

Tom Temin: And Lesley, your name is almost indistinguishable from OFPP. Are you looking forward to training your latest appointee, if and when the Senate gets around to confirming the poor guy?

Lesley Field: I think I have the greatest job in the world and a terrific team. So I’m incredibly fortunate to have been able to sit here for all of these years, but we’re very much looking forward to having Biniam Gebre, who was the president’s nominee for the administrator position, on board. So we’re looking forward to all of that. And I also just wanted to thank the RFP team, but also all of our agency, colleagues, GSA, DHS, everybody who has helped us think about, and SBA of course, thinking through our advancing equity in procurement. They’re all part of the team.

Tom Temin: Lesley Field is acting director of the Office of Federal Procurement Policy. As always, thanks so much.

Lesley Field: Thank you so much, Tom.

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