Agencies, find ways to lower buying costs

Frye, who has worked in uniform and as a civilian
for the service for three decades, says the strategy requires that SSG use a mix of
blanket purchasing agreements and indefinite-delivery, indefinite-quantity contracts.


Frye came to SSG in 1995 after seven years as head of the
Communications-Computer Systems Directorate at Hanscom Air Force Base, Mass. SSG, part of
Hanscom’s Electronic Systems Center under the Air Force Materiel Command, has 1,700
federal employees. It manages three major contracts: Desktop V; Integration for Command,
Control, Communications and Intelligence; and Unified LAN Architecture II.


Born and raised in Warrensburg, Mo., Frye served nine years in
the Air Force. He received a bachelor’s from Western New England College in
Massachusetts and a master’s degree from the University of California at Los Angeles.
In 1987, he attended the Senior Officials in National Security Executive Course at Harvard
University.


GCN associate editor Bill Murray interviewed Frye by telephone
from his office at Gunter Annex, Maxwell Air Force Base, Ala.


What’s more


Age: 51


Last movies seen: “Star Wars”
trilogy and “Air Force One”


Military service: Air Force from 1969 to
1978; now a colonel in the Air Force Reserve


Personal hero: “My father, Fred Frye,
who said, ‘Whatever job you have, do it as well as it can be done,’ and
‘Remember the people you go by on the way up the ladder are the same ones you go by
on the way down.’ ”


Sports: Avid golfer and racquetball player





GCN: The Standard
Systems Group started its fee-for-service work in 1993. How has it changed how SSG
operates?


FRYE: It’s focused us and our contractors more on the customer-supplier
relationship. In the fee-for-service environment, if the customer doesn’t buy your
product, you don’t have a job. That has forced us to be more innovative and reactive
to the customer’s needs.


We made the transition well, but we need to reduce our overhead or our customers will
take their business elsewhere. Our surcharge on our indefinite-delivery,
indefinite-quantity contracts this year is 1.66 percent. Next year, it drops to 1.06
percent. That reflects the way we’ve reduced overhead.


We don’t need as many people to handle paperwork because we’re using Web
pages for ordering.


One of the big advantages of online ordering is the configuration checker, which
ensures that customers configure systems right. They can’t order a system that
doesn’t work. When they ordered on paper, we used to have to verify that it would
work. In a lot of instances, it wouldn’t.


Our other services include an around-the-clock help desk that handles worldwide calls.
We do remote network and systems administration. We do software distribution,
configuration management and software development. We run the Air Force Network Operations
Center.


We have probably up to 50 percent of total information services activity, counting our
sister organization, the Materiel Assistance Group at Dayton, Ohio. If you look at our
total expense, about half of it is outsourced.


I think we have a mature software testing organization. We do some of it with in-house
resources and some with contractors. We tend to do whatever is most cost-effective, and
it’s not always cost-effective to use contractors.


GCN: Have IMPAC credit cards
reduced your paperwork for small orders?


FRYE: It’s been a substantial paperwork reducer.


[Between October 1997 and early this month, SSG processed $171.7 million, or nearly 80
percent of its $215.4 million total purchases, through IMPAC credit card and Web orders.]


GCN: How are you planning to
make integration for command, control, communications, computers and intelligence more
popular with buyers?


FRYE: The transition’s going well. The contractors [BTG Inc. of Fairfax, Va.,
Tracor Inc. of Austin, Texas, and SRA International Inc. of Arlington, Va.] and my staff
are streamlining the time and effort to execute delivery orders.


A good example is our joint effort to set up Web-based ordering on IC4I. It’s
pretty early, but we did about $5 million in sales [in the first seven weeks]. We’ve
got to win the customers’ confidence that we can deliver products and services in a
timely manner.


GCN: Where do you see SSG going
with blanket purchasing agreements vs. indefinite-delivery, indefinite-quantity contracts?


FRYE: BPAs are one more tool in the kit. They’re the answer to several of our
commercial information technology needs, but not all. In some instances, we’re going
to have to do our own IDIQ. We’re going to look at acquisition strategy for each
contract on a case-by-case basis.


With an IDIQ, you can specify exactly the terms and conditions and needs. You can do a
lot better best-value analyses and trade-offs if you have unique requirements. You
can’t use a BPA if there are any terms and conditions incompatible with the General
Services Administration schedule.


GCN: Do you think you will have
difficulty getting the same discounts as on the current Desktop V contracts?


FRYE: I don’t think so. If we buy only desktops from one contract, instead of
everything from soup to nuts, more [vendors] may be able to play because they’d only
have to be able to make the right desktop PCs. Whereas before, they had to make servers,
desktops, laptops and different things.


GCN: What about the Unified LAN
Architecture II and other contracts you’re managing?


FRYE: ULANA II is a key contract providing services and equipment to the Defense
Department. Almost 50 percent of orders have come from non-Air Force customers. The Army
and Defense Logistics Agency and other services were part of the source selection way back
when. They always planned to use the contract. It was as much of an Army and DOD contract
as it was an Air Force contract.


GCN: Aside from ULANA II,
how’s business with non-Air Force agencies?


FRYE: Roughly 12 percent of our Desktop V orders come from non-Air Force customers.
Remember that the Army and Navy are prohibited from using Desktop V. That 12 percent comes
from DLA and civilian agencies.


About 40 percent of IC4I orders are from non-Air Force agencies. The BPAs that we
recently let to Dell Computer Corp. and Micron Electronics Inc. [of Nampa, Idaho] are Air
Force-only.


GCN: Why is that?


FRYE: The restriction was placed on us. If you make a BPA departmentwide, it’s
almost the same as a GSA schedule.


GCN: I’ve heard that the
five-year, worldwide, on-site warranties are popular on Desktop V.


FRYE: Exactly. That’s why I think the combination, where we use BPAs to supplement
Desktop V, will work well.


GCN: Did you change your IDIQ
strategy because of the protests of Desktop IV and V and the problems you had when Zenith
Data Systems was bought by Packard Bell NEC Inc. of Westlake Village, Calif.?


FRYE: I can’t remember any time when the Desktop buys weren’t protested.
Anytime you have a contract of substantial size in today’s environment, it is almost
impossible not to have a protest.


The main reason is supposed to be that you think the agency that made the source
selection did something wrong. It’s my view that a lot of source selections are
protested for business reasons.


If I’m supposed to award a contract in April or May and have end-of-year funding
available and you have a big GSA schedule contract, you protest my award so that it’s
not available for end-of-year ordering. You might bring substantially more business to
your GSA schedule contract.


GCN: Can anything be done about
that?


FRYE: No. I can’t say for a fact that’s what people do. But there may be
business reasons.


GCN: What are you doing about
software licensing? The Air Force Materiel Command and other Air Force agencies are trying
it to save money.


FRYE: We’re very much involved with AFMC and others in volume buys of licenses.
AFMC recently announced a volume buy of Oracle Corp. database management system and tool
software off one of our contracts, [the Integrated Computer-Aided Software Engineering
contract held by Logicon Inc. of Torrance, Calif.].


AFMC saved money on all the licenses it already had. I think there’s a lot more
that the Air Force needs to look at.


Anywhere there’s a popular product and a large number of users, it makes sense to
consolidate and save money on quantity discounts.


If I have Oracle out there and everyone is buying their own individual licenses, how
many different versions do I have? If I do a volume buy, I can centrally control the
distribution and maintenance of licenses and keep track of the version numbers running at
all locations. You can’t make that happen when everyone’s doing their own thing.


Every major command is looking at volume buys as well as whether we should set a
standard for the entire command. They’re also looking at outsourcing and letting the
contractor do the licensing. There’s a lot of discussion at the major command level
and the Air Force level.


It makes sense that the different commands deploy tools that work together.  
 

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