New adaptive acquisition policies for defense contractors

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Contractors may not all be aware of the Defense Department’s new adaptive acquisition framework. But they should be. Eight acquisition policies are going to pop out of it in the next few months. The idea is to tailor acquisition strategies to the product or service DoD will buy. For more, Federal Drive with Tom Temin turned to federal sales and marketing consultant Larry Allen.

Interview transcript:

Tom Temin: Adaptive acquisition — tell us what it is and what it means.

Larry Allen: Tom, the number one thing that people need to know is that the adaptive acquisition framework for DoD is being rolled out this year. This is not something that is coming soon or coming around the corner. It’s coming this year. In fact, DoD already has issued a draft interim room rule on how it’s going to apply streamlined acquisition procedures to the acquisition of software. Coming soon, coming this year are going to be additional guidances on how to buy both professional services and as-a-service solutions defense business systems, things that may not necessarily grab the daily headlines but are vital to making the Department of Defense’s daily missions work. And also, of course, things like weapons systems acquisition and some of the things that we traditionally think of when we hear about DoD buying. But the whole objective of the adaptive acquisition framework, Tom, means no more one size fits all for DoD. Different departments are going to be tasked and encouraged to use the proper acquisition method most closely tied to the solution that they’re actually trying to acquire. The theory being that if you’re acquiring commercial services you don’t have to, for example, know everything about buying submarines, and you can get that service acquisition done much more quickly, and with lower overhead for the contractor.

Tom Temin: So there’s no real change in the DFAR or even any rulemaking. This is sounds like more of an educational process to be put onto the contracting community in DoD so that they do tailor their strategies to what they’re buying?

Larry Allen: Right. Not to be too wonky, Tom, but those who are familiar with DoD acquisition know that it’s series 5000 guidance that’s given out to DoD acquisition professionals, and the changes are being made here so that there are additional, more specific sets of guidance based on a wide variety of things that the department buys. Essentially, it’s recommending best practices. It’s recommending streamlined acquisition, things that are intended to get services and solutions into the hands of war fighters more easily. We’ve kind of heard about this before. But the fact is that the adaptive acquisition framework has been in development now for a couple of years, and this is the year that it’s going to be rolled out. It’s going to take changes to thinking, it’s going to change, require changes to tradition, so it’s not gonna be an overnight change. But the intent is that the education and training will come at the practice of these new procedures, will bring success and, of course, success breeds people copying that so that they can be successful, too.

Tom Temin: Is there anything that contractors can do to join in this process or help it long in some way?

Larry Allen: Oh, I absolutely think so, Tom. I think that contractors need to be aware about what these changes are. My experience is generally that contractors are usually better up-to-date on changes like this and can educate their DoD customers, particularly any DoD contracting officers they’re working with. Look, DoD’s acquisition department already has — a lot of guidance and a lot of the background on this project up on its website, and it’s available there for contractors to read and download and use when they go on discussions with potential clients. So I think contractors help themselves and help their customers by promoting the knowledge and the adaptability that the acquisition framework is supposed to bring.

Tom Temin: We’re speaking with Larry Allen, federal sales and marketing consultant now with BDO, and I wanted to ask you about the possibility of the Section 889B changes coming this year. Refresh our memory on what that is and why it may not happen right away.

Larry Allen: Tom, what we’re really talking here is about Section 889 subsection B. This is the part of Section 889 that would prohibit government contractors that do business with the Department of Defense from using covered IT and telecommunications products anywhere in their enterprise. So, in the generic sense, in a real sense but as an example we’re talking about technologies from Huawei and ZTE, but also dozens of their subsidiary and affiliated companies, literally several dozen, Tom. And so it’s not enough that you as a contractor will sell that to the government. That was already part of Section 889A. Part B, subsection B says you contractor, will not use covered IT or telecom anywhere in your enterprise if you want to do business with the Department of Defense. Proposed rule is supposed to come out on that section next month in March, and the final rule itself is supposed to be active this August. So we’re coming right down the path on a rulemaking that could have a very significant impact on the DoD contracting community. Having to mitigate your risk, first on the systems that you use in support of a DoD contract; secondly, the systems that you have anywhere in your domestic operations were tied to government business or not, and then third, systems that are in use in any of your global enterprises. Those were just some examples of things that contractors are gonna have to review and audit to ensure that they don’t run afoul of the Section 889 part B requirements. Talking with people on Capitol Hill, Tom, they’re starting to be aware that the way the existing rules, existing statute was written is overly broad. But Rome wasn’t built in a day, and this part of Section 889 is unlikely to be disassembled in a day. I’m being doubtful that it will be disassembled this year, Tom. Congress is going to have to see two things. It’s gonna have to see problems that have really caused some trainwrecks or car crashes. And it’s gonna have to see some viable recommended solutions, so that there becomes amended version of this because Congress is unlikely to do away with the overall intent, which is to keep DoD network secure.

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Tom Temin: Yes, because if a contractor or sub has any of that equipment anywhere in the supply chain, and probably almost no one does not have something somewhere in the supply chain, it could lead to this hunt-and-replace, and expensive process. I would think in order to be compliant for the purposes of DoD contracts.

Larry Allen: Right, Tom, and that’s the absolute genesis of this. And I think that everyone agrees on the need to keep DoD network secure and the contractors with the daily access they have to DoD networks and the things that they provide to DoD themselves. They have to be secure as well. There’s no question that we need to have supply chain security. There’s no question that we want to make sure we keep probable bad actors out of the DoD supply chain. The way the current statute is written, it was going to cause a significant amount of expense and a logistical nightmare for contractors. So I think what we’re really saying here is how do we get to the desired goal of DoD supply chain security and do it in such a way that we’re not driving people out of the defense industrial base, particularly smaller and innovative companies? And how do we manage our risk appropriately to ensure that the DoD customer still has options and still has access to the solutions it needs to do its job?

Tom Temin: Larry Allen is federal sales and marketing consultant, now, with BDO. Thanks so much as always.

Larry Allen: Tom, thank you, and I wish your listeners happy selling.

Tom Temin: We’ll post this interview at www.federalnewsnetwork.com/FederalDrive. Subscribe to the Federal Drive at Apple Podcasts or Podcastone.

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