Joe Jordan, the outgoing administrator of the Office of Federal Procurement Policy, said agencies have only scratched the surface of the administration’s campaign to buy smarter.
Jordan, whose last day at OFPP is today, said savings from strategic sourcing are up, there’s more competition among vendors than in previous years, and he expects overall federal procurement spending to go down once again when the final fiscal 2013 numbers come in next month.
“You’ve seen the largest two-year decrease in contract spending in history. The President has long said we need to reign in contract spending, and I’ve said we have to buy smarter,” Jordan said in an exclusive interview with Federal News Radio. “I think you see some clear evidence we’ve been able to do that, and not just because the topline went down. A lot of that is due to smarter buying techniques and some of that is due to budgetary issues.”
He pointed to several areas, including a larger number of agencies buying more strategically, cutting management support service contracts, increasing contracts to small businesses and ensuring there is real competition for procurements.
“It’s one thing to say we are bringing the topline down, but it’s another thing to do that in record numbers while again, increasing opportunities for small businesses, increasing competition rates and reducing it not just across the board, but in some targeted areas,” he said.
Jordan, who will join FedBid as its president of the public sector next week after spending 18 months as OFPP administrator and five years as a political appointee, said the final 2013 numbers are not out, but the Government Accountability Office figures are accurate as far as he can tell. GAO said last week agencies spent about $460 billion on procurement last year.
“We are trying to do some ratios between contract spending reductions versus overall discretionary spending reductions. I do know that contract spending has fallen faster than grant spending, but that’s just an easy ratio I can look at,” he said. “The President has been clear in a demand-constrained economy, it’s not necessarily a good thing to reduce this across-the-board spending at an overly aggressive rate. That can actually be unhelpful. What always is a good idea is buying smarter within the pool, the pie, however big it is, because it frees up resources to be put to more mission critical uses.”
But Jordan, who began his federal career as the associate administrator for government contracting and business development at the Small Business Administration, said each of the initiatives will continue to build on their successes while being led by Office of Management and Budget Deputy Director for Management Beth Cobert and acting OFPP Administrator Lesley Field in the coming months.
Under strategic sourcing, the interagency leadership council identified 20 areas where the government could apply this concept with a total potential savings of $20 billion.
And despite concerns in the private sector that the government is actually limiting competition and damaging its industrial base, agencies have saved more than $360 million through the first three quarters of fiscal 2013, according to StrategicSourcing.gov.
Jordan said agencies will continue to learn from their experiences and move out of a typical strategic sourcing approach and into one that focuses on dynamic pricing and more favorable and standardized terms and conditions.
Prices paid portal in beta
He said one way they will do that is by using the prices paid portal that he has been advocating for over the last year.
“GSA now has this in the beta test and we’ve got hundreds of people who are banging on the beta version of the prices paid portal,” Jordan said. “That will very much help because we have to get the data to be able to do that dynamic pricing. I think as you see current solutions move up the maturity scale and the overall strategic sourcing effort move up the value chain — not to super complex services or any of that, I know there’s concerns about that — but move up from core commodities, you will see those types of things front-and- center.”
Currently, the proof of concept price paid portal is focusing on three areas: office supplies, domestic delivery and IT services under the Alliant and Alliant small business governmentwide acquisition contracts.
“It is our hope that increasing transparency on the prices paid for comparable goods and services will allow acquisition professionals to perform more accurate market research, improve ability to negotiate prices, and track and change behaviors that drive the total costs of items we use to do our jobs,” GSA wrote on the portal’s homepage.
Jordan said GSA and OFPP recruited a few Presidential Innovation Fellows to help develop the tool.
“I think that the functionality will be ready very soon, and then step two will be making it as usable as possible with fresh, accurate and what’s called Level 3 data, or line item data,” he said. “That’s a real challenge. We are working closely with the agencies to figure out how to do it. Not to make the perfect the enemy of the good and we need every single purchase in there, but we do need to have a critical mass of prices paid information inside the tool so it provide real value to the contracting officers.”
Jordan added data scientists and contracting officers are giving OFPP and GSA input on how best to design the tool.
“This is just one of those objectively good things that can really help improve the acquisition system for everyone,” he said. “I’m really excited for when this reaches full maturity.”
Workforce held steady
Of course, a full functioning prices paid portal would be nice, but having the acquisition workers in place and trained to use it is even more important.
Jordan said he’s proud of the progress the government has made over the last two years in recruiting, training and retaining acquisition workers.
The government has about 36,000 contracting officers classified in the 1102 job series, including 24,000 at the Defense Department. Jordan said that number has stayed steady or increased a little over the last few years despite pay freezes, a government shutdown and continued retirements.
He said about one-third of the 36,000 1102s have less than four years of experience, meaning they were hired during the Obama administration.
Additionally, about one-third of all 1102s have more than 20 years of experience, meaning there isn’t this wave of retirements happening.
Jordan said OFPP has worked closely with the Federal Acquisition Institute and the Defense Acquisition University to align their curriculums and share resources.
“Instead of focusing on what’s different about Defense and civilian procurement, we focus on what’s similar and get those things synthesized well,” he said. “And then delivery of that training, where we have one registration portal now, the Federal Acquisition Institute Training Application System (FAITAS) where folks can go and see where seats may be available at DAU and if they don’t fill all their class seats with Defense folks, they can provide that opportunity to civilian people.”
Jordan said FAI and DAU also are expanding their online and distance learning options for acquisition workers.
As for the next OFPP administrator, Jordan said that person should embrace the acquisition workforce by listening and learning from them. He also recommended being proactive in addressing concerns or issues.
As for his new job, he said after five years in the administration, it was time for a change.
“I’m definitely excited about staying in the same field and helping taxpayers get more value out of each procurement dollar,” Jordan said. “I’m also going to very much miss being on the inside, but I’m confident OMB and OFPP are set up for success and will continue making significant positive strides against all the acquisition opportunities we have in front of us.”