Defense Still Can’t Crack the Code on IT Procurement

By Sandra I. Erwin
Information systems in some federal agencies are so outdated that the joke in Washington is that government workers have better technology at home than at the office. EvenPresident Obama piled on last week. "Our IT purchasing is horrible," he said. "It's true in the Pentagon. It's true in the agencies. It's true in the Department of Homeland Security.”
Unfortunately, things aren’t likely to change much any time soon, at least at the Defense Department. One problem is that COTS (commercial off the shelf) technology cannot seamlessly be inserted into government operations, said the Pentagon’s second ranking procurement official Frank Kendall, who is principal deputy undersecretary of defense for acquisition, technology and logistics.
The Pentagon has a huge, and growing, appetite for information technology — from wireless devices to human-resources databases and command-and-control networks. And with an IT budget of $36 billion — almost 40 percent of the entire federal IT sector — it has plenty of money to buy the latest and greatest technology. Most of the Pentagon’s IT dollars, however, are spent on support contracts and upkeep for the vast mesh of 15,000 defense information networks. Converting outdated systems into state-of-the-art IT also is hindered by government regulations that add so much red tape to the buying process that, by the time a piece of equipment is purchased, it is already technologically obsolete.
The Pentagon’s chief information officer, Teresa Takai, was brought on board partly to tackle this issue, Kendall said April 20 during a breakfast meeting with reporters. One of her priorities will be to boost the defense IT talent base. “Maybe [one of the problems is] not having enough expertise on board to really do things smartly,” Kendall said.
When buyers are not knowledgeable enough, contractors take advantage of that, and overpromise, said Kendall. Suppliers often convince government officials that if a business-management system works for a Fortune 500 corporation, then it should work for the Defense Department. That is a fallacy that has led to costly mistakes, Kendall said. Case in point is a personnel management system that was years in development, didn’t work, and Defense Secretary Gates terminated two years ago after a billion dollars were poured into it.
“One of the things we’ve discovered is that economies of scale have a limitation,” Kendall said. “When you’re doing something on that scale, you’re taking on a lot of complexity.”
Another impediment to IT modernization are government regulations. Kendall said he heard from a contractor that, in a single IT system, there were 170,000 compliance requirements for the software. “That just gives you a sense [of the situation] … You don’t just take a COTS product and use it,” Kendall said.
“There’s an enormous amount of work to be done to adopt a [commercial] system for use by the government,” he said. “We put legacy systems all over the place.”
To avert wasteful ventures in the future, the Pentagon will pare back its IT ambitions and take smaller steps, instead of trying to overhaul an entire system all at once, Kendall said. “We’ll try to figure out how to move incrementally,” he said. “The biggest problem we’ve had is trying to do too much, too fast, and not breaking up the jobs we’ve had into manageable bites with well-defined requirements.”
The goal is to be able to “break the job up in increments that are testable … make sure it’s right before you commit resources,” he said. This buying philosophy will require far more discipline, he added. The days of carefree spending, Gates has stated, are over. And bloated IT programs will be scrutinized. “I have seen a set of numbers that suggest that the government is paying too much for its IT support,” Kendall said.
Any chance of improvements in IT procurement will depend on having skilled managers, Kendall insisted. “One of the things we have to do in the government is build up our expertise in this area. We have a ways to go on that.”
Many Pentagon program managers continue to treat IT programs as if they were weapon systems. “It isn’t the right model for IT,” Kendall said.
Government procurement officials from other agencies acknowledge that, fundamentally, the problem is their lack of familiarity with technology. “You really need people at the cutting edge of this stuff,” said Francis Spampinato, director of contracting and acquisition at the Federal Aviation Administration. “You have to be able to move swiftly,” he said at anindustry conference last year in Washington, D.C. Agencies should hire contract specialists “who actually have done IT contracts, special terms and conditions, performance reviews … people who are familiar with IT contracting,” he said.
Dozens of studies by government commissions and think tanks have proposed ways to fix federal IT contracting. But none is likely to lead to major improvements because government buyers live in a culture that is incompatible with the fast-paced tech industry, officials at the conference said. “We’ll never buy that stuff well,” said Elliott Branch, executive director of acquisition and logistics management at the Department of the Navy. “The government, culturally, has no sense of play around IT,” he said. Federal buyers generally lack curiosity about what’s out there and how it works, he noted. One reason for that are rigid procurement rules. “We don’t have the flexibility in our system to allow brighter folks to see what’s out there and bring it to our enterprise,” said Branch. “Until we stop trying to stop making mistakes with IT and embrace the way IT is developed and used in this country, we’ll never do this well. And we haven’t done this well.”

Topics: Infotech, Procurement

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