MA

OMB Reform and Reorganization Plan: Proposed Changes to Acquisition Processes

Published: June 22, 2018

Federal Market Analysis8(a) ProgramUSDABusiness SystemsContracting TrendsIT OutsourcingOMBPolicy and LegislationProfessional ServicesSet-AsideSmall BusinessSBADOTTREASVA

Contracting recommendations in the OMB's Reform and Reorganization Plan are potentially consequential if implemented.

The Office of Management and Budget has released its long-awaited Reform Plan and Reorganization Recommendations for “structurally realigning the Executive Branch to better serve the mission, service, and stewardship needs of the American people.” Among the issues discussed in the plan is the subject of government contracting. Specific plan recommendations concerning contracting are few, but the two measures that are mentioned are potentially consequential if implemented.

Consolidation of Small Business Contracting

One of the outlined proposals calls for the creation of a “one-stop shop” for all small business contracting certifications at the Small Business Administration. Taking this step, claims the OMB, “will synchronize processes for both small businesses and the federal agencies that want to contract with them.”

What would “synchronizing processes” entail?

The OMB cites a conclusion reached by the Government Accountability Office (GAO) that duplicative small business certification programs exist at the SBA, Agriculture, Transportation, Treasury, and Veterans Affairs. Despite the overlap, these programs have unique requirements, including different eligibility criteria, non-standard application processes, and various reporting standards that make participation in contracts onerous for small businesses.

The OMB recommends, therefore, that these certification programs be consolidated into the SBA’s Office of Government Contracting and Business Development. Programs that require “industry-specific economic expertise” would remain at their respective agencies, in which case the SBA would eliminate its duplicative authority.

The result would be to simplify the process for small businesses to participate in government contracting programs and reduce the amount of money spent by the listed agencies on maintaining duplicative programs. Reductions in program operations could also have an impact on contractors supporting them, however, as the demand for professional services declines.

Transitioning to Electronic Government

The other recommendation with implications for government contracting is expanding the use of electronic records management. While not specifically targeting contracting processes, the elimination of paper could have a significant effect on contract management at federal agencies. Vendors could also feel the changes as new agency solutions require them to adjust their processes.

Implementing this recommendation could give a big boost to vendors selling cloud-based contract management and record keeping solutions. The President’s Management Agenda is already pushing agencies toward greater adoption of cloud computing so the OMB plan is yet another nudge in that direction. Down the road a move to electronic-based contracting could also open the door to greater use of blockchain technology. Both types of solutions – cloud or blockchain – could easily prompt agencies to engage a vendor to help them implement a new records management strategy. Industry could also see a bump in the number of procurements for analytics to visualize and manage contract data.

Any changes which make it easier for small businesses to participate in competing for government contracts are welcome. New work could be on the horizon for vendors offering software-based solutions and emerging technologies. The question is if agencies are ready to chart a new course.