Acquisition Assessments: A-123 and the PMR Process Christopher Teti Felicia Cannon Procurement Analyst Procurement An

1. Acquisition Assessments: A-123 and the PMR Process Christopher TetiFelicia Cannon Procurement Analyst Procurement Analyst General Services Administration Office of GovernmentwidePolicy May 2011

2. It’s not your Grandfather’s PMR • Today’s Procurement Management Review is an evolving process, including: • TRANSACTIONAL REVIEWS: This is just the traditional reviews of contract and lease files, but: • Expanded in size and scope. • Another good word is “Operational.” • A-123 REVIEWS. This newer segment is the “Entity Level Review.” • Based on OMB Circular A-123, “Management’s Responsibility for Internal Control” • Another good word is “Strategic

3. TRANSACTIONAL REVIEWS • What the IG Recommended to the PMR Division: • Select Files with specific risk areas in mind. • We thought: Recovery Act; Year End Actions; Complex Contract Administration; High Dollars. • Review more files. • We thought: In a PBS Region, review 20 contracts and 20 leases; for MAS, 25 to 35 files. • This continues for PBS and MAS this year (AAS is cut back due to numerous reviews by other parties).

4. TRANSACTIONAL REVIEWS • Other Changes in Our Approach: • Speaking to the Contracting Officer while on site. • We both learn and get to know one another. • More background on the contract/lease. • An opportunity to provide missing documents that may be sitting on a desk. • Using electronic applications: • Initial Research in FPDS, eSRS, PPIRS. • FAS has some additional opportunities in this area.

5. TRANSACTIONAL REVIEWS • PBS Prospectus Reviews: • At least twice a year, we schedule a “contract admin” review of a Prospectus Level construction contract. • Prospectus awards are those which, in FY 2010, exceeded $2.79 Million and had a line of their own in the Congressional Budget. • This differs from other prospectus reviews by switching attention from the pre-award phase to the contract administration phase.

6. TRANSACTIONAL REVIEWS • We Love our Volunteers from the Regions. • They assist us with the Transactional Reviews. • What they get out of the deal: • A chance to see the activities of other Regions, including Best Practices. • A certificate worth 40 hours of continuous education. • Our eternal gratitude. • See your supervisor if you would like to volunteer.

7. A-123 REVIEWS • Strategic Leadership • Internal Controls in the Acquisition Arena • following in the path of similar reviews for Finance. • What’s the connection between the Leaders and the Soldiers? • Where the Transactional Review looks back a year, the A-123 Review can look both backward and forward to future plans.

8. A-123 REVIEWS • Some of the Issues Addressed: • Organizational Location of Acquisition personnel. • Warrant Program: who merits them? Are they withdrawn when no longer necessary? • Pre-Award Reviews of Contract Files at certain dollar levels. • Internal Control: Directions on how to “do it.” • Who supervises COs? What are the CO’s critical elements like? • How does the Region plan for ongoing training and future human capital?

9. A-123 REVIEWS: The Four Cornerstones • The preceding slide addressed just a few A-123 questions. • There are many more that can be discussed during a PMR. • These issues are divided into the Four Cornerstones of A-123, so let’s take a look at those.

10. Cornerstone 1: Organizational Alignment and Leadership • We’ve already spoken of organizational location of acquisition personnel, the identity of their supervisors, and their critical elements. • But do the acquisition personnel understand their roles with internal stakeholders (PMs, CORs/COTRs, Building Managers, etc)? • For FAS, does the organization train its contractors and client agencies on the use of the Schedules?

11. Cornerstone 1: Organizational Alignment and Leadership • What Internal Controls are in place or in development? (Pre-Award Reviews/Panels, PBS Lease Reform, Data Accuracy for FPDS). • How are deficiencies in the Internal Control Process rectified? • How is training planned, conducted and monitored (for the CO, COTR, PM)? • Cuts in Funding: How is this handled? Is in-house training provided?

12. Cornerstone 2: Policies and Processes • Communication Issues: • Does the acquisition staff partner with internal and external stakeholders to determine end user requirements? • Do they provide well-informed business guidance to Requirements personnel on market research, competition, and small business programs? • How does the organization share lessons learned and best practices?

13. Cornerstone 2: Policies and Processes • More Communication Issues: • Does the PBS Leasing Team collaborate well in advance of an expiring lease? • Are solicitations sufficiently clear so that offerors can make informed business decisions on whether to respond? Can offerors clearly perceive performance measures (quality, responsiveness, schedule, cost)? • Contractor Performance Evaluations: Are they shared with the contractor and the acquisition workforce?

14. Cornerstone 2: Policies and Processes • Other Issues here: • Are Green clauses used in both leases and contracts? • How is the Region addressing Lease Reform Procedures and Models? • Did the Region meet its Competition Goals? What was the role of the Regional Advocates and Market Research? • Are acquisition teams empowered, with clearly defined roles and responsibilities (CO, COTR, PM)? Are they FAC Certified?

15. Cornerstone 3: Human Capital • Senior Leaders and Managers: • How are they held accountable for effective management? • What methods of employee feedback are used to make improvements? (Off sites, “stairwell meetings). • How does management choose the improvements to make? • How does the organization validate the results?

16. Cornerstone 3: Human Capital • Training • Is there an intern program with trainers and mentors? • How are journeymen continually trained? • Do supervisors without an acquisition background receive FAC-C training? • How are the training programs evaluated? And by whom? • What improvements follow? • Does everyone have a detailed IDP?

17. Cornerstone 3: Human Capital • Size and Nature of Workforce. • Is there a strategic human capital plan, including acquisition? • What is the appropriate size of the acquisition workforce, now and in the future? • How is workload tracked and evaluated (short term, long term)? • What is the attrition rate for the acquisition workforce? • Are acquisition positions difficult to fill?

18. Cornerstone 4: Information Management and Stewardship • At one time, this Section was considered entirely “National” (for example, STAR and Comprizon are national applications). • This meant we did not assess Cornerstone 4 during Regional PMRs. • However, for the PMRs conducted this year, we’ve added some Regionally-oriented areas.

19. Cornerstone 4: Information Management and Stewardship • Some examples: • Accuracy, Review and Validation of FPDS Data. • Does the Region regularly conduct and make use of spend analyses for key goods and services? • Are all proposed Lease Construction Projects submitted to Central Office for approval prior to issuance of the Request for Lease Proposal? • How does the Region help ensure that hardware and software is reliable, secure and user friendly?

20. How Do Regions Respond to the A-123 Review? • Regions submit basic data, such as: • Organizational Charts and Warrant Lists • Internal Controls: Memorandums on local policies and procedures • Meetings are held with FAS Management, PBS Contracts Management and PBS Leasing Management to discuss Cornerstone issues. • Local Management submits a completed A-123 Questionnaire.

21. What’s the Practical Outcome of a PMR? • After the PMR Field Trip: • The two separate teams which conducted the Transactional and A-123 Reviews compare notes. • Generally, strengths and weaknesses on one side relate to similar strengths and weaknesses on the other. • A Draft Report is sent to the Region for comment and discussion before the Final Report is issued. • Final Reports include “Action Plan” templates. It is here that the Region can insert its suggested approaches to resolving Findings.

22. What’s the Practical Outcome of a PMR? • After the Final Report: • The Report is shared with Central Office Acquisition Management and the IG’s Office. • The Region submits its Action Plans. • Over time, the Region documents completion of these Plans (issuance of new procedures, training, “fixing” files). • The PMR team reviews the completion documentation and closes the PMR.

23. What’s the Strategic Outcome of a PMR? • Identification of Strengths and Best Practices • Highlighting Problem Areas and Planning Their Resolution • Building Continuity in Processes Across GSA • Determining How Effectively the Acquisition Workforce is Managed • Identification of Training Needs • Reporting upward, each June, to the Senior Assessment Team (SAT): • General national results (not by Region)

24. The Future of PMRs – Whom Do We Visit? • Traditionally, we have reviewed half of the Agency’s purchasing activities each year. • We are gradually moving toward a situation where we will review stronger organizations every three years; stable organizations every two; and tentative organizations on an annual basis. (The latter are briefer revisits the second time around.) • In this way, we would review higher risk locations more frequently.

25. The Future of PMRs – What Do We Look At? • For FAS/AAS: We have already moved to a model where, in Fiscal Year 2011, we review only key risk actions in the procurement cycle. • For PBS and FAS/MAS: We will follow in Fiscal Year 2012, once we complete our two-year baseline review of all Regions. • In this way, we review higher risk activities more closely.

26. The PMRs for Fiscal Year 2011 • FAS Office of Personal Property Management, Sales Program Division – Nov 2010 • Rocky Mountain Region – Jan 2011 • National Capital Region – Feb 2011 • PBS Headquarters – Feb 2011 • Northwest/Arctic Region – March 2011 • FAS Office of General Supplies & Services/Office of Acquisition Management – March 2011

27. The PMRs for in Fiscal Year 2011 • FAS COWP Review, DC – March 2011 • Great Lakes Region – April 2011 • FAS Office of ITS – Center for IT Schedule Programs; and the Office of Travel, Motor Vehicles and Card Services – April 2011 • New England Region – April 2011 • Upcoming: Heartland Region – May 2011 • Upcoming: PBS Southeast Sunbelt Region – June 2011

28. Some Websites for Late Night Reading: • OMB Circular A-123, “Management’s Responsibility for Internal Control,” December 21, 2004: http://www.whitehouse.gov/omb/circulars_a123_rev • OFPP Memo, “Conducting Acquisition Assessments under OMB Circular A-123,” May 21, 2008: http://www.whitehouse.gov/omb/procurement_index_memo/

29. Some Key Points of Contact • Procurement Management Review Division: • PBS: Shirley Rohmer, 940-748-2785 • PBS: Chris Teti, 215-446-2851 • PBS: Frank Sharshel, 816-926-5535 • PBS: Kathy Rifkin, 816-823-2170 • PBS: Carol Lautzenheiser, 817-978-6165 • FAS: Gil Avanzado, 202-821-9867 • FAS: Suzanne Winnard, 202-208-7279 • FAS: Felicia Cannon, 253-347-9701