Select Agencies Need to Do More to Reduce IT Contract Duplication, Says GAO

Last week, GAO released a report reviewing select agencies’ implementation of category management and use of spend analyses.  Since 2014, OMB has directed agencies to fully implement category management and make greater use of spend analyses to inform their efforts to identify and reduce duplicative contracts. These initiatives are especially important in the category of IT where federal spending exceeds $90B per year.

GAO reviewed the efforts of seven federal agencies, chosen based on the highest IT contract obligations for FY 2018, and the largest number of new IT contracts issued the same fiscal year:  Departments of Agriculture (USDA), Defense (DOD), Health and Human Services (HHS), Homeland Security (DHS), Justice (DOJ), State (State), and Veterans Affairs (VA).

GAO analyzed whether agency efforts to prevent, identify, and reduce duplicative or wasteful IT contracts were consistent with OMB guidance.  GAO also determined if the agencies used spend analysis to inform these efforts.

GAO looked at the extent to which each of the seven agencies had implemented five key category management activities:

• Identified senior accountable official and developed category management policies
• Reduced unaligned spending
• Developed and implemented vendor management strategies
• Shared prices paid, terms, and conditions for purchased IT goods and services
• Engaged the workforce in category management training

GAO found that DHS and HHS had fully implemented all five category management activities. DOD had fully implemented four activities and partially implemented one activity.  State had fully implemented three activities and partially implemented one activity. Justice and USDA had fully implemented two activities, partially implemented two activities, and not implemented one activity.  VA had only fully implemented one activity and partially implemented four activities.

According to the report, “…most of the seven selected agencies had fully implemented the activities associated with identifying a Senior Accountable Official and training their workforces. In contrast, about half the agencies had fully implemented the activity associated with sharing contract information.”  One reason for varied implementation, cited by agencies, was that they were still defining how to best integrate category management into agency work processes.

GAO also analyzed the extent to which each of the seven agencies regularly used spend analysis activities to identify contract duplication, and to what degree the agencies developed and implemented strategies to reduce duplication.

DOD, DHS, HHS and State fully or partially used spending analysis to identify potential contract duplication on a regular basis. These same four agencies also developed and implemented strategies to address the identified duplication, which resulted in millions of dollars in savings. The remaining three agencies, USDA, Justice and VA, had not implemented either of the two spend analysis activities.

GAO made 20 recommendations to six of the agencies in the report, to fully implement the category management and spend analysis activities.