Emerging Trends in Procurement: Crisis or Opportunity? And the NCMA Response Andrew C. Obermeyer, CPCM, Fellow Member, Board of Directors National Contract Management Association
Jan 12, 2016
Emerging Trends in Procurement:Crisis or Opportunity? And the NCMA Response
Andrew C. Obermeyer, CPCM, FellowMember, Board of DirectorsNational Contract Management Association
The Acquisition Workforce Has Changed
•Years of downsizing (1990’s)•Human capital strategies have not kept up
with evolving demand•Different set of expectations, e.g. business
advisor•Evolving gap in replacing the retiring
professionals• Inadequate investment in training
Acquisition Workforce Demographics - Age55+30%
45-5439%
35-4418%
<359%
Acquisition Workforce Demographics - Education
Doctorate6%
Masters44%
Bachelors36%
other13%
College Graduates - 2005
0
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
China India United States
GraduatesCollegeEngineering
It will take about a generation to reverse the ratio of highly skilled workers between the U.S. and India and China. When the generation of engineers and scientists that sent the man to the moon retires, who is going to replace them?”Academic Disciplines & Employment Trends’Applied Information Management Institute, Jan 2006
3.2M3.1M
2.0M
600k
300k
<100k
Raytheon Company Employee Population Profile
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
<1 1-5 6-10 11-15 16-20 21-25 26-30 31-35 36-40 41-45 45+
Years of Service
Nu
mb
er
of
Ex
em
pt
Em
plo
yee
s
Under 25 26-35 36-45 46-55 56-65 66-75 76-85Age:
Strategic Target Areas
Targeted College Hires Targeted
Experienced Hires
The Emerging Competition For Talent"One in every three of Lockheed's employees is over 50. To sustain our talent base, we're hiring 14,000 people a year. In two years, we're going to need 29,000 new hires; in three years, 44,000. If this trend continues, over the next decade we will need 142,000." - ROBERT J. STEVENS, chairman, President and CEO of Lockheed Martin. Wall Street Journal, April 19, 2006
The Nature of What Government Buys Has Changed
•Offloading simple transactions•Larger, more encompassing services•Complex IT, communications, and weapons
systems•Accelerated fielding to serve the war
fighter•Emphasis on logistical support
PEGASYS
WARSIM SE-CORE
NGATS
IBS
AVCATTAWACS
TSV TBMCS TCO
PATRIOT
NFCS
MCTIS
LFC2IS
MAGIS
MOUT-OIS
MILES XXI
F/A- 22
SIMACET
BATESAALPS
SECOMPI
C-130C-17
SOLDIER-CATT
C-5
CBS
ACTF
FIOP
GIG
TACSIM
IEWTPT
LOGISTICS AALPS
C-5 C-17 C-130 MILES XXI PEGASYS SE-CORE
INTEL AWACS IBS MAGIS MCTIS MTS NGATS PKI
TRAINING ACTF AVCATT CBS IEWTPT SECOMPI SOLDIER-CATT TACSIM WARSIM
FIRE SUPPORT BATES F/A-22 NFCS TSV
MOB/SUR STEPS MOUT-OIS
Command and Control FIOP GIG LFC2IS SIMACET TBMCS TCO TELEPORTS
ADLER
MTS
ACS
JC2
SLAMRAMM
MIP
MSD
IDM
DMS-A
BSTF
JCM
GMLRS
ATACMS
Profiler
TAIS
PAFCS
MLRS
MEADS
MCSLLAPI
JTAGSJLENS
IMETS
GCCS-A
GBS
Mongoose
FAAD-C31
FBCB2
DTSS
C2PC
BCS3 BFT
ADOCS ASAS AMDWS
AFATDS
HMEE
REBS
APACHE
HIMARS
CHINOOK
Blackhawk
A2C2S APKWS
PHOENIX
FIREFINDER (Q37)
PLS
BSM
SHORAD
Engineer Vehicle
CBRNRS
INTEL ACS JTAGS TES UAV-CL IV-b
C2 ADOCS
ADSSI AFATDS AMDWS A2C2S ASAS BCS3 BFT C2PC DMS-A DTSS FAAD-C3 FBCB2 GCCS-A IDM IMETS JC2 TAIS PAFCS MCS MIP
MANEUVER APACHE APKWS JCM
AIR DEFENSE ATACMS MEADS SLAMRAMM SHORAD JLENS LLAPI
FIRE SUPPORT ADLER FIREFINDER-Q37 GMLRS HIMARS PROFILER PHOENIX MLRS
LOGISTICS BSTF CLOE PLS MSD
MOB/SURV BSM BLACKHAWK CBRNRS CHINOOK Engineer vehicle HMEE REBS MONGOOSE
GCSS-A
TES
UAV-CL IV -b
Soldier System
Internal Interfaces
CAMEL
HIPPO
TEP
DCGS-A CHIMS
Land Warrior
LWP
FRS
LHS FUEL FARM
AMPS/JMPS
HEMTT
HMMWV
AAFARS
PLST
FIREFINDER (Q36)
SentinelTC-AIMS II
Logistics AAFARS CAMEL FMTV HEMTT HMMWV HMMWV M1114 HIPPO LHS FUEL FARM LWP MAINTENANCE TRUCK/FRS PLST TEP TC-AIMS II
C2 AMPS/JMPS
Sentinel
INTEL DCGS-A CHIMS
FIRE SUPPORT FIREFINDER (Q36) IMS NLOS-LS
MANEUVER
LAND WARRIOR SOLDIER SYSTEM
FMTV
HMMWV M1114
UAV CL IV ASTAMIDS / EO/IR Tactical SIGINT PAYLOAD UAV –SAR/GMTI
NETWORK ADSI BVTC CLOE DCTS GPS JTRS1 JTRS5 JWARN LFED MC4 NCES PKI STEPS TELEPORTS WIN-T
LETHALITY ACSW AIRBURST MUNITION ACSW KE MUNITION ACSW TRAINING MUNITION CKEM Electronic Time Fuse EXCALIBUR MACS MOFA NON-LETHAL 155mm PGMM Training Unique Ammo MK-44 AMMO 30 mm AIRBURST MK-44 AMMO 30 mm KE MK-44 AMMO 40 mm AIRBURST MK-44 AMMO 40 mm KE MRM/ERM
MGV ACSW CED FCS–Non FCS CID HTI-FLIR LIGHTWEIGHT120MM cannon (Pending) MFCS MK-44 PROPHET JCAD JSLSCAD JBPDS JBSDS
SOLDIER HSTAMIDS LLDR MK VII RADIAC SET Soldier to FCS CID Soldier to Soldier CID
UGV ARV(L) JAVELIN MULE GSTAMIDS
TRAININGATIA
CCTTCTIADLSOneSAFOneTESS
ExternalSystems and Interfaces
Future Combat System (FCS)
The Working Conditions Have Changed•Compelling urgency – everything is
accelerated in fight against terrorism•Doing business in the battle space•Deployment of personnel leaves home
force shorthanded•Unprecedented level of support needed for
hurricane Katrina response•Constant threat of oversight and second-
guessing decisions•High media attention
The Acquisition Rules Have Changed
•Years of acquisition reform (1990’s)•Commercial items and complex services•Larger task orders with less transparency•Organization conflicts of interests• Interagency contracting•More outsourcing (competitive sourcing)•Expanded socio-economic programs•Buy American and Buy America
The Supply Base Has Changed
• Industrial base consolidation•Partnerships and teaming•Global competition has increased•Strategic sourcing•More eBusiness•More competition at 2nd and 3rd tier• Increased OCI challenges
National Imperatives Driving Changes
Domestic Economics - Debt, Medicare, Social Security, Supplementals, Trade Balance
Threat Changes - Asymmetric warfare (bio, cyber, IEDs); world-wide terrorism; weapons proliferation; rogue nuclear states
New Missions - Homeland defense; missile defense; counterinsurgency; stability and reconstruction
Warfighting Changes - Netcentric Warfare; Systems-of-Systems; Joint and coalition operations
Defense Budget Shifts - From Equipment to Personnel, O&M and Homeland Security
Technological Changes - Integrated data; open-sources; bio, nano, robotics, high-energy lasers, etc.
Industrial Changes - Horizontal & vertical integration; commercial high-tech advances
Globalization - Rapid spread of Technology; multinational firms; foreign competition
Acquisition Workforce - Aging; wrong skill mix; training needs; competition for skilled people
Recent “Scandals” - Druyun, Cunningham, Abramoff, etc.
This All Adds Up To Risk!
•There is more work, it is more complex, and it must be acquired faster than ever.
•Workforce downsizing, expert class retiring, while expectations and oversight increases.
•Rules are more flexible, actions are less transparent.
1. The Federal acquisition workforce remains a major challenge.• Shortage of skilled labor is not unique to our
profession, industries or employers.• Cannot replace ‘brain drain’ fast enough.• Workload will remain.• Training funds get cut routinely.• Alternative workforce solutions required.
– Eliminate barriers to hiring external candidates.– Eliminate barriers to re-hiring annuitants.– Increase use of alternative work arrangements and
compensation plans.– Increased telework.
2. The political pressures on the Federal procurement system will increase short term.• Mission will not be reduced soon.
– Replacing war equipment and materials.– Aging systems (refueling tankers, etc.)– Insatiable appetite for improved warfighting technologies.
• Dozens of contracting oversight bills in committees.• Increased attention on blended or multi-sector
workforce.• Attention on GSA Administrator, SBA effectiveness,
NASA IG, HUD Administrator, DHS acquisition organization and DoD systems acquisitions.
3. Financial pressures will force discretionary budget reductions beginning in next five years.• The Fiscal Wake-Up Tour being conducted by the
Comptroller General.• We spent less of our budget on defense in 2006 than
in 1986 or 1966, as a % of GDP• Discretionary spending is down from 67% in 1966 to
38% in 2006.• Budget deficits of $928 billion in last two years.• Rising entitlement (health care) costs is the main
cause.“Saving Our Future Requires Tough Choices Today”
GAO-07-739CG April 4, 2007
4. Regulatory changes likely:
• Reduce number of contracts awarded non-competitively.
• Eliminate practice of Lead Systems Integrator (LSI).• Increase use of fixed-price contracts.• Increase small business contracting goals.• Restrictions on contracting with entities in tax default.• Guidance on use of award fees.• Emphasis on using hybrid contracts containing
multiple incentive types.• Restrictions on outsourcing, new requirements to in-
source.• Increase acquisition workforce development programs.
NCMA Strategic Objectives 2007-2008
•Develop the Next Generation of Contract Management Professionals
• Increase Professional Advocacy•Reach More People in the Federal Contracting
Community•Develop professional standards
Develop the Next Generation of Contract Management Professionals
1. Introduce undergraduate students to the CM profession and involve them in NCMA by offering student memberships, student chapters, and student programs.
2. Increase the preparedness for candidates entering the CM workforce by increasing undergraduate programs containing CM and related curriculum, and by publishing a standard CM curricula and promoting the program to universities.
3. Accelerate the development of new professionals through a leadership development program.
4. Increase research and writing opportunities for new professionals and students through the Macfarlan program.
Increase Professional Advocacy
1. Improve perception of the contract management profession in industry, the government (including Congress), the press, and the general public, through an active public relations program.
2. Increase recognition of NCMA in industry, the government (including Congress), the press, and the profession, through an active public relations program.
3. Increase membership participation in advocacy activities through bilateral electronic communications and events.
Reach More People in the Federal Contracting Community1. Expand the number of programs to serve the federal
community, including education, certification, conference, publication, and other types of programs.
2. Increase communication and involvement of the senior executive cadre within the profession.
3. Utilize education partners, advertisers and corporate sponsors to reach new people in the federal community.
Develop Professional Standards
1. Baseline existing professional standards for government and industry organizations; benchmark standards and processes of other professions.
2. Reach consensus among stakeholders (chapters, BOA, BOD, academia) on Generally Accepted Contract Management Practices (GACMP).
3. Align professional standards and certification processes.
Communities of Practice
•More ways to connect to the information, people, and tools that you need.
•Launch April 2008:– Task order and Schedule Contracting– Small Business Contracting– Performance Based Acquisition
•Online features: e-courses, discussion forums, listservs, blogs, expert networks, e-newsletters, website, research archives
•Meetings at World Congress, new educational conferences, quarterly magazines
New Program!
What you can do.
•Lead by your actions.•Be a “chief courage officer”•Stay informed on the issues.•Have opinions, and engage in the
discussion.•Participate in continuous learning. •Demonstrate your competency by getting
certified.•Resist cynicism and skepticism.•Participate in your NCMA chapter.Engage in your profession!
NCMA21740 Beaumeade Circle, Suite 125
Ashburn, VA 20147
Neal J. Couture, CPCMExecutive Director
[email protected] x423
571-382-1123703-448-0939 (fax)
www.ncmahq.org