DOD aims to improve how it buys services

Shay Assad, director of Defense Procurement and Acquisition Policy

The Defense Department is making another attempt to improve how it buys services.

Over the next three to five months, DOD will identify what services the military branches buy and put them into portfolios. Once the services are in portfolios, Defense officials will determine what the best practices are to buy them, said Shay Assad, director of Defense Procurement and Acquisition Policy.

'All cards are on the table and we will try to take the best approach,' Assad said yesterday at a conference in Arlington, Va., sponsored by the Contract Services Association of America, an industry association in Arlington. 'We spend more on services than major weapon systems so it is important for us to manage how we buy services and make sure we create competition.'

Improving the way it buys services has been an ongoing challenge for DOD. In 2003, officials said they would draft and test procurement strategies to coordinate and consolidate some services purchases.

The amount DOD spends on services has been steadily increasing over the past decade. In fiscal 2006, the department spent $146 billion on services, including between $3 billion and $4 billion with the General Services Administration's Federal Technology Service and $13 billion to $15 billion off of GSA's Federal Supply Service schedules, Assad said.

DOD's total procurement budget for 2005 was $268 billion, and for 2006 it will likely have only increased.

'Our challenge to GSA is if they are the best place to buy services, we should use GSA,' Assad said. 'I've met with GSA and Jim Williams [the Federal Acquisition Service commissioner] and other agencies, including Interior, about this.'

Assad added that the services would be in the portfolios by December and then over the next 12 to 18 months, DOD would come to a consensus on how to implement the best practices to buy these services.

With the amount on services continuing to rise, Assad said DOD needs to focus on the need to get information systems to the warfighter and manage their procurement processes more efficiently.

DOD does not have a consistent methodology to develop the different parts of an acquisition, such as the performance statement of work, Assad said.

Assad said competition remains important, but the bureaucracy needs to be improved, including the time it takes to make an award. He said under the Navy's SeaPort-e multiple award contract, it takes 115 days to develop and award a task order ' of which 58 is used to develop requirements and the statement of work.

'We want to reduce bid and proposal costs,' he said.

He added that the major services are trying to figure out how to reduce the procurement lead time to less than 60 days.

Another way to reduce costs would be by not requiring vendors to submit proposals for similar multiple award contracts, Assad said.

'If a vendor already is qualified for one MAC, then they don't have to compete again and again for a place on a similar one,' he said.

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