An Update to Drive Category Management Government-Wide

Earlier this year, we announced the launch of category management government-wide. Category Management, an approach used extensively by the industry and other governments for years, is a new approach to better buying and managing the Federal Government’s vast goods and services more like a single enterprise – which can lead to big savings, better efficiencies and improved performance. After all, the US Federal Government is the single largest buyer in the world with annual spending on goods and services close to $450B a year. That means that the more we work together to leverage our buying power, drive more consistent practices across our agencies, share information, and reduce duplication, the better the results for the American taxpayers.

When we announced the launch of category management last January:

• The Administration formally made it a top priority through release of the December 2014 directive to Federal agencies, “Transforming the Federal Marketplace” ;
• We broadened the Strategic Sourcing Leadership’s charter from just strategic sourcing to category management and renamed the group the Category Management Leadership Council (CMLC); and
• The CMLC approved dividing the federal marketplace into ten super categories of commonly purchased items, including information technology (IT), professional services, and human capital.

Since that time, we’re excited to share with you seven key steps we’ve taken to move forward with implementing category management even further, and how this approach will help both our acquisition workforce and our federal contractors.

1. We’ve created an important foundation document to drive our effort –“Government-Wide Category Management Guidance.” This is the single definitive source to explain the “how” in how we will implement Category Management and to ensure that we are clear, consistent and impactful in how we drive Category Management. It describes among other things:

• The case for change;
• The key participants, like the Category Management Leadership Council, the Category Managers, the Office of Federal Procurement Policy in OMB, the agencies, and others; and
• Roles and responsibilities, like the role of a Category Manager, who will lead each category and will be a senior government executive, recruited from government or industry, who is a true expert in their specific chain.. The Category Manager will undertake activities like a government-wide spend analysis, market research and analysis, financial and supply chain risk analysis, a strategic approach to the supply base, and supplier outreach.

We encourage you to take a look at our Guidance to learn more about Category Management. Expect to soon see a playbook that will show examples of key “plays” that highlight best practices in Category Management.

2. We established category management as one of 15 Cross Agency Priority (CAP) goals, a tool used by leadership to accelerate progress on a limited number of Presidential priority areas where implementation requires active collaboration between multiple agencies. Category Management CAP Goal Leads Frank Kendall, the Under Secretary of Defense for Acquisitions, and Anne Rung established three new Category Management goals: (1) increased savings; (2) reducing the number of new contracts; and (3) increasing spend that is under government-wide management.

3. GSA has made even more improvements to the Acquisition Gateway, a new online tool for the federal contracting workforce that contains key acquisition information and tools by category.  Since January, agencies have shared with GSA and they have uploaded to the site thousands of pages of acquisition information covering multiple categories, including IT software, hardware, security and services. For example, contracting officers can find information on NASA SEWP, Army CHESS, and GSA Alliant, including a summary of their terms and conditions, the fee, agencies designated to use the contract, and a link to the agency ordering sites.  GSA is developing better tools like the “solutions finder” which allows users to search 171 available government-wide acquisition vehicles to find the best solutions to meet their needs. There’s even an interactive community to allow users to ask questions, share information, and exchange best practices. We are asking all acquisition professionals across government to visit the Acquisition Gateway and register as a user, try the tools, look around at the available resources and provide GSA with feedback on how it can be improved.   

4. We’re capturing the good work already underway by the agencies to bring “spend under management,” including those that have agency-wide strategically sourced contracts in place with mandatory use policies, strong metrics to track the success of the contract, and a designated leader for the contract. We’re using a “Spend Under Management Tiered Maturity Model” to evaluate and highlight the good work already underway at the agency level, and to more clearly see where we need to go to move to a more mature model of managing our spend government-wide.

5. We’ve identified at least four agencies - GSA, DoD, OMB and OPM – to lead at least seven of the ten new “Category Centers of Excellence.” Shortly we will formally announce the specific agency leading each Category Management Center of Excellence and the Category Manager to lead that category on behalf of the government.

6. Last week, GSA launched the new single Professional Services Schedule giving federal agency acquisition professionals the ability to obtain total contract solutions for their professional services requirements using one contract vehicle. This effort reduced eight GSA Schedules contracts to one, significantly reducing contract duplication and workload burden on both contractors and contracting officers from negotiating, administering, and auditing multiple contracts. In the professional services category, GSA will eliminate more than 700 contracts resulting in an estimated five-year savings of $3.95 million, and sustained savings of $1.29 million annually thereafter. 

7. The recently-awarded government-wide Identity Monitoring, Data Breach Response and Protection Services Blanket Purchase Agreements (BPAs) give agencies access to a number of well-qualified contractors capable of providing credit monitoring services in response to the recent data breaches. The requirements for these BPAs were developed collaboratively by an interagency team of experts; an excellent example of category management at work to allow the government to buy and act as one.    

Looking Ahead

This represents just the beginning. Shortly, we will be issuing several significant category management policies to drive greater savings and efficiencies in IT, we will see even greater improvements to the Acquisition Gateway, and we will continue towards standing up all ten categories by early 2016. In the end, we will have laid the foundation towards a major transformation of the federal acquisition landscape to help the Federal Government buy and act as one. 

Anne Rung is the U.S. Chief Acquisition Officer at the White House Office of Management and Budget.

Tom Sharpe is the Commissioner of the Federal Acquisition Service at the General Services Administration.