Agencies are buying professional services at a rate experts call “astonishing.”
The growth between 2021 and 2022 was unlike ever before. And half way into fiscal 2023, the spending data shows a continued increase.
Tiffany Hixson, the assistant commissioner for the Office of Professional Services and Human Capital Categories in the General Services Administration’s Federal Acquisition Service, said agencies are spending so much money on professional services due to several reasons, starting with, of course, the pandemic.
“There were some unique things that have happened over the last couple of fiscal years that really required agencies to lean on their service providers, as well as big investments that the Department of Defense is making for their major programs that leverage professional services to execute them,” Hixson said on Ask the CIO. “Where we see the majority of spend in the professional services space is for management advisory services, that’s really consulting services, program management services really all fall under that that bucket, and close behind that or sometimes is in first is engineering services. In the professional services space, those two buckets of spend or subcategories of spend, as we category managers like to call it, are really the two key areas of spend.”
Hixson said because of these trends, those two categories are among the initial focus areas of the OASIS+ vehicle, which GSA expects to release the final solicitation in the coming weeks.
The popularity of professional services isn’t necessarily new or surprising. But the increase of 9% in 2022 over 2021 was not expected.
Hixson said agencies spent on professional services across the government, not just with GSA, more than $110 billion last year.
“For 2023, I would be surprised if we had another 9% increase in terms of spend, but I think it’s probably going to be around that mark by the time we get to the end of the fiscal year,” she said. “In terms of trends in 2022, we also saw a slight increase in the amount of small business spend that was happening in the category. We, of course, are pushing for that to continue on a number of fronts. What we’ve seen for some of our best-in-class contract programs is really that’s where we’re seeing a lot of small business usage, and they are helping us to drive improvements on that front. Last year, there is about $30 billion in spending that went to small business, or about 29% of overall spend, for the category which is healthy, and we’re looking to improve that.”
Reducing the burden of bidding
One of the ways GSA is seeking to improve not just small business spending, but the buying of services more generally is through a new set of tools.
For instance, Symphony is an online tool that lets contracting officers accept offers electronically.
Hixson said her team tested Symphony when it conducted the on-ramps for the OASIS contract. It was then expanded to other programs, including Polaris and Astro.
“Less than five years ago, we were getting CDs and having to download the offers from a CD into an electronic folder. So Symphony is really a game changer for us and for industry in terms of reducing that burden because you can just go online and submit your offer,” she said. “For a solicitation like Oasis+ with six contract programs that you can apply for, we’re really trying to streamline the offer process, not lose paperwork and it really is helping us to do that. It has been so effective that we said, ‘hey, we really need to start testing this out on one of our large IDIQ contracting programs for ordering contracting officers to use for their task order solicitations.’ It also has some back end capabilities for us to be able to track who our customers are soliciting, how many RFQs they have out and other similar things.”