Department of Defense Gets B in Small Business Use

The Department of Defense gives itself a B in overall use of Small Business in FY2009. As a Small Business Prime Contractor for the DOD, Partnet is proud of our contributions to the DOD and feel that we give the America Taxpayer a good buy for their money. Small businesses frequently operate with lower overhead than large companies, giving a lower overall cost of development for a project. Small businesses are usually juggling fewer projects than their large business counterparts and can give full attention to a project and great customer service.

Shay Assad, director of defense procurement and acquisition policy, the final speaker during the two-day 2010 DLA Enterprise Supplier Conference and Exhibition, held in Columbus, Ohio, Aug 24-25, commented that the Defense Logistics Agency and its industrial partners must improve buying power and create more value for warfighters and taxpayers. He said, “What we’re looking to do is partner with industry to find ways to become more efficient.”

One of the ways that the DOD can achieve this goal is to increase the use of small businesses. The amount of business going to small businesses should also increase in the coming year, Assad said. The current Defense Department goal for small business partnerships is 23 percent, but currently stands at about 19 percent. Out of $400 billion spent by the department on supplies and services, about $12 billion is going toward small businesses.

DLA recently honored small businesses with a number of awards at their DLA Supplier’s Conference. Though we didn’t win an award this year, we had the honor of attending the awards ceremony and supporting our fellow small businesses.  We know we give great service and value to our customers and who knows […]

Beyond sales: Eight reasons why the DOD EMALL works for government

I was asked the question earlier:  “How is the DOD EMALL important other than as a sales tool?”

Apparently, the question took some people by surprise, but not me. The DOD EMALL provides several acquisition services that extend beyond traditional eCommerce (though that is certainly a big part of it).

Here are my top eight reasons why DOD EMALL works for government:

1. Saves money.  Buying online is inherently cheaper than going to a store or writing a contract for each purchase.

2. Global access – 24/7.  DOD EMALL provides a single point of access for users around the world, and around the clock.  This allows shoppers and vendors to work on their own schedules, regardless of time or location.

3. Innovation platform. For years, DOD EMALL has been a launching pad for several, new IT-acquisition practices and applications — resulting in a number of firsts for the Department of Defense:

Establishment of unique Service-acquisition rules like the Army JWOD/AbilityOne and the Army discount policy.
Strategic sourcing of office supply contracts — started by the Army, but now implemented for all the the Services.

4.   DLA enhancements.  DOD EMALL has opened up access to the Defense Logistics Agency’s managed items for Performance Based Logistics (PBL) contractors and state governments.

5.  NAVFAC base services.  For over ten years, the Naval Facilities Command has used the DOD EMALL to support base-services contracts on Navy and Marine bases worldwide.

6.  Government-wide Acquisition Contracts.  DOD EMALL allows  Military Services to grant and gain access to GWAC contracts from other federal agencies, enabling strategic sourcing across the Department of Defense.

7.  Data quality.  DOD EMALL regularly provides Level III credit card data to several Service systems, and soon the Federal Procurement Data System – Next Generation (FPDS-NG) as well.

8. […]

Governments using BPM for optimizing acquisition processes

Last week, Matt Langan of Appian had an excellent post on the emerging use of Business Process Management (BPM) software in the government acquisition process. He stated that, “we are seeing government embrace Business Process Management (BPM) acquisition solutions (versus COTS) in order to gain process transparency, react quickly to change and improve process efficiency; thereby allowing federal purchasing organizations to successfully enhance the entire procurement lifecycle.”

BPM software can guide government acquisition officers through the complex rules of government procurement — saving time and reducing administrative overhead and paperwork.  Each agency develops unique workflow and business-rule requirements, which in turn, are addressed by the application software.

With over 15 years of industry experience, Partnet understands the complexity of the business rules surrounding government acquisition, but also recognizes problems associated with implementing standard BPM applications.

Partnet’s BPM solution is a flexible and easy-to-use business-rules framework and workflow engine that directly addresses problems found in other BPM solutions.  Quartz BPM uses simple, UI-based wizards that allow any end user to design and optimize business rules and workflow for approvals, registrations, permissions, and more. These wizards help non-developers easily identify application trigger points, data entities, users, and other critical process elements. The Quartz BPM interface also generates graphical workflow representations that allow users to see their processes as they’re defined.

In other words, Quartz BPM helps align and continuously improve government and commercial  business processes.

Cost-Cutting Solution: Inventory Management Software

When it comes to organizations’ finances, some years are better than others. It’s no secret that for many in the private and public sectors, the last few years have been on the lean side.

It requires creativity for a company or government department to tighten its belt without cutting its services or quality. With fewer goods being sold, companies earn less money and the government takes in less in sales and payroll taxes.

How can these organizations effectively cut costs and maintain their overall strength? One way is with inventory management software. Inventory management software is an automated system for keeping track of inventory levels, product shipping and sales.

Two typical inventory-management problems that can hurt organizations’ financial health are having too much or too little inventory. Many times, a company or government department purchases products or parts in bulk to ensure they have enough on hand to meet demand the moment an order comes through. They also may think the discount they get by buying a large number of products or parts will offset any potential risks.

However, this strategy leaves them vulnerable to product spoilage and obsolescence. An overstock of products or parts also prevents the capital that was spent on them from being used in more productive ways. Organizations have a finite amount of capital to work with, so it’s important that they spend their money as effectively as possible.

Being understocked on products is what most organizations try to avoid. Not having enough inventory on hand causes manufacturing delays, and it can drive customers away.

To find a balance between an overstock and an understock of products, many groups turn to inventory management software. Using barcode scanners to receive, track and sell products, organizations can know […]

Around And Around With Rounding We Go . . .

No, it’s not the latest Dr. Seuss book.  It’s dealing with rounding of numbers, and in this case currency within  eCommerce websites.

Rounding has been part of computer languages as early as FORTRAN and C, which started back in the 1950s.  Unfortunately for developers during those times, various forms of rounding had to be coded specifically for each instance.  Since then, however, more modern programming languages allow for various rounding options in much easier fashions.

eCommerce sites often integrate with multiple downstream systems.  The DOD EMALL — the largest Government eCommerce site for federal buyers — is no different.  Recent efforts within DOD EMALL have been to compare all uses of currency within the application, as well as to review their uses in downstream systems.

How many versions of rounding can there be?  Well, there are numerous forms of rounding, including round-up, round-down, round-ceiling, round-floor, round-half-even, round-half-up, and round-half-down.  It really depends on how complex you want (or need) things to be.  Software developers may be wondering why their code isn’t acting as expected, and will be seeking answers. As a DOD-contracted IT-provider for the DOD EMALL, Partnet has used several rounding functions, but here are a couple of examples:

The first example is the one you probably learned when you were a child. Round-Half-Up goes to the nearest neighbor —  less than 5 rounds down, equal to or greater than 5 rounds up.

Round-Half-Up Examples

Initial Value
2 Digits of Precision

3.2277
3.23

3.22277
3.22

3.22255
3.22

3.275
3.28

Round-Half-Even is different, as it rounds to the nearest neighbor value (less than 5 rounds down, greater than 5 rounds up), but if it is 5, then it rounds to the nearest even number (either by staying or going up).

Round-Half-Even Examples

Initial Value
4 Digits of Precision

3.22223
3.2222

3.222347875
3.2223

3.222247875
3.2222

So why is rounding a big deal?  If you […]

Market Forces in Government eCommerce

Last week I wrote about the success the Department of Defense is having in leveraging Government eCommerce for the strategic sourcing of its office supplies.  What I didn’t mention was the side effect its having on the pricing structures of  office supply vendors on the DOD EMALL.

In 2004, when the Army was establishing their strategic sourcing policy, they did a market-basket analysis of office supply prices on GSA Federal Supply Schedule Contracts.  In establishing their blanket purchase agreements with 20 office supply holders, they negotiated a 15% GSA  price reduction and mandated the use of those contracts.

Each of the Armed Services followed suit — negotiating their own office supply contracts and mandatory online purchase policies.  As a result,  DOD EMALL quickly became a magnet for office supply vendors, large and small. The number of office supplies vendors on DOD EMALL skyrocketed to over 500.  So when the Army redid their initial market basket analysis two years later, their 15% pricing advantage had vanished.

What happened?

Market forces brought down the prices of the competing catalogs.  By mandating the use of Government eCommerce for office supplies, the Army had saved millions of dollars on their own office supplies and created a savings environment for the whole Department of Defense.

Defense Acquisition Reform: Closer Than You May Think

The Department of Defense recently got an earful from the Defense Acquisition Reform Panel (DARP) over its “outdated” acquisition and contracting policies.  The panel’s criticisms centered largely on ill-suited “cultural issues” preventing the DOD from moving towards more IT-focused procurement methods.  Amber Corrin’s Inside DOD blog from Federal Computer Week gives a nice, high-level overview of this argument.

Recommendations made by the panel included:

Improved process for developing contract requirements
Performance-incentives for DOD’s acquisition workforce
Getting more value from the industrial base.

I can’t imagine the recommendations are anything the DOD hasn’t already realized.  As one of many DOD-contracted IT-providers, Partnet recognizes the changes DOD is implementing towards modernizing their IT-capabilities, particularly around acquisition.  The potential cost savings to taxpayers in finding smarter, faster ways to supply and equip our Warfighters is enormous.  And few know that better than the DOD.

However, the DARP report seems to imply that the DOD is sitting on its hands, meanwhile, letting old-fashioned acquisition protocol dictate the Department’s future.

Again, I’m pretty sure the DOD knows exactly what needs to done, and in many instance, is taking strong initiative to correct so-called “cultural issues”.  Government eCommerce, for instance, is one area where the DOD is making tremendous strides.

Debra Fryar has written a number of excellent posts on this blog illustrating exactly how the DOD is leveraging information technology towards streamlined acquisition and purchasing.  And DOD EMALL (which Partnet proudly built and operates, I might add) is a concrete example of the Department’s success so far.

Not to mention the DOD is also looking to technology for OCONUS souring and contracting solutions–specifically, the potential for web applications to optimize contingency contracts and purchasing from global vendors and local markets.

None of this is to say the DOD should […]

Strategic Sourcing on the DOD EMALL

In 2006, the Office of the Secretary of Defense added Strategic Sourcing to the Defense Procurement and Acquisition Policy’s (DPAP) list of standing initiatives.  According to DPAP, strategic sourcing is defined as:
. . . a proven best practice [representing] how the DoD will acquire goods and services moving forward. It is the collaborative and structured process of analyzing an organization’s spend and using the information to make business decisions about acquiring commodities and services more effectively and efficiently.”
Though the government continues to struggle with strategic sourcing as a practical matter, there are success stories that can help inform guidelines for a future, government-wide strategic sourcing policy.

Take Government eCommerce, for instance.

In 2004, the US Army established 20 blanket purchase agreements for office supplies on DOD EMALL, and subsequently issued a Service-wide policy that all office supplies were to be purchased online through these established contracts.  By negotiating their own strategic contracts, the Army saved 15% on office supplies, while ensuring that all online purchases were compliant with Ability One, the Buy American Act, and other procurement regulations.  In addition, the DOD EMALL provided Level 3 processing data on all of its office supply purchases.

Over the next two years, the Navy, Air Force, and Department of Homeland Security implemented similar strategic sourcing contracts for online office supply purchases.

The potential for strategic sourcing through online applications, like the DOD EMALL, is virtually limitless.  If the DOD was able to save 15% on the cost of buying office supplies, consider the savings of implementing similar measures for all commodities  throughout the Federal government . . .

Why Government eCommerce Over Traditional Procurement?

There are several good reasons.

It has long been known that traditional procurement processes, whether public or private, are often arduous and time consuming. By establishing long-term purchasing contracts with strategic companies and letting junior buyers place delivery orders against those contacts from an online marketplace, senior acquisition professionals are freed to work on major acquisitions. Government eCommerce is also much more economical because online ordering is quick and easy once those contracts are enabled, and establishing multiple contracts for a given commodity also ensures competition and price competitiveness.

Government eCommerce also provides potential visibility into vendor inventories. Using a distributed architecture, online marketplaces can communicate directly with vendors using application integration tools. This allows secure, reliable messaging and data transmission; including elements like order status, back-order information, stock-on-hand, and stock-out data.

The DOD EMALL is an example of Government eCommerce in action. The Defense Logistics Agency’s (DLA) distributed architecture system allows Department of Defense and other Federal Agencies to house long-term contracts and leverage the government’s buying power. DOD EMALL currently maintains over 2000 individual contracts to support more that 60 million items—helping DOD EMALL to exceed $800 million in FY09.

As the world becomes more integrated online, its only logical that governments take proactive measures to keep pace with the private sector. Government eCommerce ensures that Federal, state, and local purchasing stays ahead of the curve.

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