Johnson Says GSA Provides Best Value for Government Contracting Needs
As Prepared for Delivery
U.S. General Services Administration
30th Anniversary of the Government Contracting Management Conference
November 14, 2011
I’m delighted to be here to speak with you all and to celebrate the 30th anniversary of the Government Contract Management Conference. I’ve spent much of my career working in and on the issues around public procurement, contract management, and organizational and government efficiency, so speaking to you all today feels like talking to family. You get it.
I want to acknowledge how important I think conferences like this are. The community of contracting professionals needs to come together in new and stronger ways, and I can’t stress how important these opportunities are, especially in this time of change. Contracting is a science, a discipline and an art.
This community of colleagues is critical to burnishing your knowledge and skills, as well as raising the confidence of your clients and stakeholders. Therefore, strategic portfolio management, collective voice, best practices, and the affinity groups and networks available to you when you meet this way are invaluable in your line of work.
I don’t need to tell this audience that our government – our country – is going through an extraordinary time filled with tectonic changes and deep uncertainty. I’ve been giving speeches about change for nearly 20 years now. But while it was driving up to the house, coming up the walk, climbing the steps ... now it’s opening the screen door and walking in the house.
My 22-year-old son, with his new college diploma, keeps saying, “You know, Mom, the world has really changed since I was in high school.” That was only four years ago, but you know, he’s right! And if a 20-something is finding it fast, it is significant. The pace of change is faster than ever before, and the nation and government at all levels need to set our sights on the future.
Looming largest on everyone’s radar, of course, is the budget. We have all seen budget debates come and go. But this time is different. In the past, budgets were tightened, priorities were shifted, funds were reallocated. Today, the constraints are wholesale. GSA’s major construction and alterations appropriation, for example, was cut 90 percent this year. That’s 9-0. And the squeeze isn’t just hitting the federal government. In fiscal year 2010, states had to close budget gaps of $124 billion and are projected to have another $101 billion in gaps to close next year. Programs across the entire government are under new and direct scrutiny. Operational efficiency is no longer a “nice-to-have.” It’s essential; it’s imperative.
At the same time, the needs of our citizens and the demands on our customer agencies have grown. Increasingly, agencies and government need to do more with less, and the pressures they have always faced aren’t necessarily going away. As we know, disasters don’t stop because of shrunken budgets. Those who wish us harm don’t sit back to give us breathing room. Law enforcement, citizen protection, and essential services must continue.
At every turn, wherever Americans are hurting, wherever homes and livelihoods have been destroyed, governments large and small – state, local, federal – stand up and respond. Government must still function regardless of the fiscal and budgetary environment, and public servants – from firefighters to war fighters – still need the best tools and supplies available. That’s where we – the acquisition workforce – can flex our muscles and deliver real value for our communities and for our country.
Why us? Because we’re the expert shoppers. We’re the folks you want on your team when you’re making your purchases, when the budgets are tight and there’s no room for error. We can cut costs, drive bargains, and deliver cast-iron value. It’s what we do, and we do it well.
The procurement community is like the keel of a boat. Under the water, not flashy, but essential. We keep the boat on course, level, and moving through calm waters – or stormy seas. Of course, being good at something can have unintended consequences, and it’s at the moment of greatest change when the steady hand starts to get the most attention. It makes you stand taller and stand out. It makes others see you in a new way. And we’re living that at GSA. I have referred to this moment for GSA as the dog that finally caught the bus.
We have always been the folks that agencies call when their air conditioning breaks or they need to re-up their vehicle lease. But two months ago, my phone rang. It was the head of a major agency asking to come visit us and get our advice. I was surprised: “You want to come here?” But then it rang again. And again.
Across the board and across the government, agencies are coming to us, sitting with us in conference rooms, opening up about their predicament and asking for our expertise. They’re telling us that they want radically different asset management help, judo improvements in efficiency, and a full view of their options. They need help from workspaces to information technology, from commodities to consulting services. They need us in ways never experienced before, and everyone – everyone – is feeling the heat. I’m here to tell you that we’re here to help.
To illustrate how we think about the assistance we offer, I want to draw on an old management story about a pie maker.
There was a woman who loved to make pies – she’d bake and bake. So she opened a pie shop and made dozens, then hundreds, of pies. She made so many that they were overflowing. She ran out of room to put them. She started having supply shortages. She couldn’t manage the front of the shop and also the back of the shop. In other words, she was working in her pie shop.
Then along came a consultant and told her that she had it all wrong. She needed to work on her pie shop, too. She had to understand the business side of it. The accounts receivable, the invoices, the supply and demand.
At GSA, we’re working both in the pie shop and on the pie shop, and I’d like to tell you a little bit about those efforts.
In our shop, we’re getting aggressive in pushing for new products, new solutions, and new vehicles for you, the contracting officers.
Our strategic sourcing initiative, for example, is offering a tremendous opportunity for agencies to engage in cooperative buying. By bringing agencies to the negotiating table, GSA has been able to leverage significant savings through scale. Our strategic sourcing option for office supplies, for example, has been roaring with business, clocking about $216 million in sales in its first 15 months. The average savings on those orders for agencies is 8.4 percent, with some agencies realizing savings of nearly 25 percent. Indeed, as we look to a print management strategic sourcing option, we expect to help drive savings of close to $1 billion through equipment rationalization and behavior changes. Agencies understand this, and as a result 11 have already signed up.
But the best part about strategic sourcing options is that nearly three-quarters of the office supplies purchases have gone to small firms, helping agencies meet their goals, and supporting our economy’s most innovative companies. And they’re not only our most innovative, they’re also at the forefront of job creation.
Small businesses are responsible for two out of every three jobs in the country, and for our economy to recover, we need that community to be roaring with good health. This administration understands that imperative, which is why President Barack Obama has signed more than a dozen tax cuts for small businesses, and directed his administration to support small businesses through initiatives like the Small Business Lending Fund and the Small Business Jobs Forum. It’s why he’s pushed for legislation like the Small Business Jobs Act and is now pushing for passage of the American Jobs Act. And it’s why I’m proud that in nearly every small-business category, GSA has raised the bar and blown past our small-business contracting goals.
Another product we’re pushing out is our multiple award schedule electronic contracting initiative, which makes it faster, more efficient, more cost-effective, and easier to do business with our Federal Acquisition Service. This online system helps streamline business processes by using new electronic functions in data capture, price negotiations, work flow, and templates. It gives customers up-to-the-minute price information, and it gives industry partners a streamlined and efficient system.
So that’s how we’re working in our shop. Good products, innovative solutions.
But we also recognize that we have to work on our shop, and that means helping the nation’s acquisition professionals get the best training and support possible.
As I mentioned earlier, the acquisition workforce is under tremendous strain these days: shrinking budgets, fewer resources for training, greater demands for expertise, and ever higher expectations for flawless, cast-iron contracts. We’ve worked this side of the equation by ensuring that those in the acquisition workforce – the backbone of the federal government – have the skills, resources, and tools to do their jobs.
We’ve recalibrated the Federal Acquisition Institute’s curriculum, introduced the Federal Acquisition Institute’s Training Application System, and supported online multiple award schedule training.
At the Federal Acquisition Institute, we’re working to develop the standards for the civilian agency acquisition certification programs that shape our acquisition policies. There, we are working to be the focal point for creating collaboration across the federal government by establishing interagency groups that collectively validate the certification and delivery programs and training development.
We have also rolled out the Federal Acquisition Institute’s Training Application System tool, which enables the workforce to keep track of training and certifications. Additionally, the system provides a workforce management tool to agencies thereby reducing duplication and creating efficiencies across the federal space. And finally, the tool allows the Federal Acquisition Institute to structure its curriculum more effectively by consolidating underscheduled classes and reducing redundancy and inefficiencies. With 50,000 users already signed up, the tool is already flexing its muscles and demonstrating its value.
And, GSA has started to leverage social media to do better training and outreach to our customers via interact.gsa.gov. On that site, you can participate in free virtual conferences, join affinity groups, network, and troubleshoot. Its popular monthly webinars offer continuous learning points toward federal acquisition certification, and dozens of YouTube-style training videos.
So, we’ve done a lot, but we’re not done yet. And while millions of dollars have already been saved, there is enormous potential for yet more savings.
As we look toward the future, we’re pleased that portions of our schedules are open to state and local government. These schedules reduce redundancy, eliminate procurement confusion, streamline acquisitions, increase coordination among emergency responders, and drive costs even lower for everyone – the vendors, the government, the taxpayer. In an era of tightened budgets, governments have to be creative as they explore new, effective purchasing solutions.
We can no longer be satisfied with the status quo, and we will need to partner ever more effectively both horizontally between agencies and vertically with industry up and down the supply chain to deliver best value.
Those of us in the field of public procurement are committed to delivering best-value solutions to agencies so that they can focus on their core missions instead of operations; our job is to carry the operations load.
In this time of huge change, knee-buckling uncertainty, and massive constraints, our role as acquisition professionals is to be the anchor and the steady hand for the rest of government. We must collaborate ever closer, be ever more strategic, and pull every lever we can to bring the best tools, goods, and services to the front lines. We must do all we can to ensure that our veterans are cared for, our children are educated, and our nation is protected. We must do all we can to help government at all levels – from schools and fire departments to cities to counties to states to the judiciary – deliver services and assistance to citizens. And we must do all we can to grow our economy, support new industries and technologies, and ensure that our next century is another great American century.
Thank you all, and enjoy the rest of the conference.