Over the last two years, we’ve focused on our mission to implement the President’s vision for a modern government-- one that leverages private-sector best practices to achieve a Federal Government that is smarter, savvier and more effective in delivering for the American people.
We’ve saved more than $2 billion through category management and are on track to save $3.5 billion by the end of next year. We’ve seen prices drop by as much as 50 percent of personal computers since the release of the workstation policy. By the end of 2016, 45 percent of the $1.1 billion spent in annual purchases for desktops and laptops will be consolidated into three government-wide contracts. We’ve hit 10,000 users on GSA’s acquisition gateway, an online portal supporting category management. We’ve not only met our small business goals—we’ve exceeded them. We’ve graduated our first class of Digital IT acquisition specialists, agency contracting officers who are trained in agile approaches to purchasing IT. And we’ve created the first-of-its-kind management structure of category leaders focused exclusively on promoting agile and other inventive practices to buying across Government.
We’re proud of what we have achieved thus far – and we’re taking steps to ensure this progress continues.
In fact, I’m excited to announce the release of a draft Category Management Circular, available for public comment next week, that will further institutionalize category management across the Federal Government so that we can continue to realize bigger savings, better efficiencies, and improved performance for years to come.
Two years ago, I laid out the Administration’s plan to transform the Federal marketplace. This plan had three core aims: (1) buying as one through category management, (2) driving innovation, and (3) building stronger vendor relationships.
Here’s a look at the progress we’ve made in each of these areas:
Buying as One through Category Management
Two years ago we took category management government-wide. It’s an approach that is leveraging best practices in both the public and private sector and an approach that is shifting the Federal Government from managing purchases individually across thousands of procurement units to buying as one, in order to leverage the Government’s purchasing power.
We carefully built the infrastructure to support category management to ensure that it becomes a permanent approach to buying common goods and services. We created a governance structure, developed guidance that laid out best practices of category management, and appointed ten category managers and 350 supporting team members. We advanced innovative and effective category management policies that streamline the more than $8 billion in annual spending for IT software, hardware and mobile services and devices, and to drive further savings, improve transparency, and reduce duplication in contracting.
We hosted the first-ever government-wide buying events to help agencies aggregate their demand and reduce unit prices and administrative costs. Through the laptops and desktop policy, GSA awarded three small businesses multi-agency Blanket Purchase Agreements, resulting in an average savings of 15.6% with additional savings possible at the agency level. Further, we’re on track to meet or exceed our goals to reduce the number of contracts for laptops and desktops by 20%.
The proposed Category Management Circular aims to institutionalize the principles that are making the Federal supply chain more effective, efficient, and streamlined. The Circular establishes the broader organizational vision needed to accelerate and successfully manage the many dimensions of interagency collaboration that must occur for the Federal Government to buy as one. It also expands upon the concepts of economy and efficiency in our earlier policies to establish the key principles, strategies, policies, processes, governance structure, and roles and responsibilities to implement category management fully as the principal way in which the Government acquires and manages its common requirements.
We’ve simplified the Federal marketplace and driven innovation into the Federal acquisition space. For instance:
Through these initiatives and more, we are creating a pipeline of acquisition innovation talent and a pathway for them to innovate.
Building Stronger Vendor Relationships
Finally, we took a series of steps to foster an environment that encouraged early, frequent, and constructive engagement with industry. As a part of these efforts:
The progress to date has made significant headway in making the acquisition of common goods and services more efficient and reducing duplication and fragmentation in Government purchasing. And by leveraging our posture as the world's largest buyer, we’ve also been able to send a clear and convincing market signal that we’re committed to achieving our socio-economic goals.
Specifically, by leveraging the Federal Government’s supply chain, we’ve:
I’m personally proud of this work, and we’re not slowing down. The progress we’ve seen to date makes a very strong case for the benefits of category management, and we remain committed to institutionalizing this proven and effective practice so it continues to benefit Americans through the end of the Obama Administration and beyond.
Expect to see lots of activity in the next months to ensure that these transformative efforts continue to deliver results in the years ahead.
Anne Rung is the U.S. Chief Acquisition Officer.