category management: professional services overview · office management professional services...
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Category Management: Professional Services Overview
Geri Haworth Professional Services Category Management - Branch Chief General Services Administration
May 11, 2016
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What is Category Management?
➢Category management is an approach the Federal Government is applying to buy smarter and more like a single enterprise.
➢It involves:
• Identifying core areas of spend • Collectively developing heightened levels of expertise • Leveraging shared best practices • Providing acquisition, supply and demand management
solutions
➢Category management enables us to eliminate redundancies, increase efficiency, and deliver more value and savings from the government’s acquisition programs.
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Why Implement Category Management Now? ➢ In FY 2014, the Federal Government spent over $420
billion in purchases, which accounted for about 20 percent of the entire Federal budget
➢This was done through 500+ separate Federal departments and agencies
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Federal Government Goals for Category Management ➢Federal Government has the following goals for category
management: • Increase spend under management through better interagency
collaboration and understanding of user requirements, market dynamics, and purchasing patterns
• Reduce contract duplication through adoption of shared solutions for common products/services Generate volume savings and administrative savings from leveraged buying power better use of procurement resources
• Enhance data transparency to improve contracts and performance against priorities such as small business goals and sustainability
• Boost innovation through improved interagency and supplier partnership
• Increase efficiency and effectiveness through improved supplier performance, better buying decisions, and supply chain cost savings
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A Proven Solution that is Building Momentum
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• This is a level 1 bullet
− This is a level 2 bullet
Category management has long been applied
in procurement organizations within many of
the Fortune 500 companies
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• This is a level 1 bullet
− This is a level 2 bullet
The United Kingdom’s Government
implemented category management
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• This is a level 1 bullet
− This is a level 2 bullet
OFPP released a memo1 on December 4,
2014 outlining the benefits of implementing
category management Government-wide
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• This is a level 1 bullet
− This is a level 2 bullet
GSA is currently implementing category
management internally
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What Does This Mean for Industry Partners?
Improved
Relationships
Constant collaboration between Government and industry will
help develop a continuous process of improvement in Federal
procurement.
Reduced
Complexity
Implementing best practices across each category and sharing
contract information between procurement units in a centralized
location will reduce duplication and complexity.
Improved
Performance Performance metrics, collaboration and simplification lead to
improved overall performance for both Government and industry.
Increased
Innovation
Implementing best practices and enabling them in a central
location will allow the acquisition community to share expertise,
utilize tools, and increase innovation.
Reduced Costs That all adds up to a reduction in costs for Government, industry,
and taxpayers.
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Acquisition Gateway Will Enable Category Management
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What Hallways are Currently Active?
Hallway Currently Launched
Facilities & Construction
Human Capital
Industrial Products & Services
Information Technology
Office Management
Professional Services
Security and Protection
Transportation & Logistics
Travel & Lodging
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Common Questions Around Category Management
How does category
management impact small
business?
Isn’t category
management the same
thing as strategic
sourcing?
How will we begin to achieve
category management?
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GOVERNMENT WIDE CATEGORY MANAGEMENT
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The Government-Wide Category Structure 1. IT –
$50.7B
1.1 IT Software
1.2 IT Hardware
1.3 IT Consulting
1.4 IT Security
1.5 IT Outsourcing
1.6 Telecommunications
2. Professional Services
- $63.4B
2.1 Business Administration
Services
2.2 Legal Services
2.3 Management Advisory
Svcs (excl. R&D)
2.4 Marketing and Distribution
2.5 Public Relations and
Professional
Communications Services
2.6 Real Estate Services
2.7 Trade Policy and Services
2.8 Technical & Engineering
Svcs (non-IT)
2.9 Financial Services
2.10 Social Services
3. Security and
Protection - $5.3B
3.1 Security Animals &
Related Services
3.2 Security Systems
3.3 Security Services
4. Facilities &
Construction -$72.5B
4.1 Construction Related
Materials
4.2 Construction Related
Services
4.3 Facility Related Materials
4.4 Facility Related Services
4.5 Facilities Purchase &
Lease
5. Industrial Products &
Services - $11B
5.1 Machinery & Components
5.2 Fire/Rescue/Safety/Enviro
nmental Protection
Equipment
5.3 Hardware & Tools
5.4 Test & Measurement
Supplies
5.5 Industrial Products
Install/Maintenance/Repair
/Rebuild
5.6 Basic Materials
5.7 Oils, Lubricants, and
Waxes
6. Office Management -
$1.7B
6.1 Office Management
Products
6.2 Office Management
Services
6.3 Furniture
7. Transportation and Logistics
Services - $25.6B
7.1 Package Delivery & Packaging
7.2 Logistics Support Services
7.3 Transportation of Things
7.4 Motor Vehicles (non-combat)
7.5 Transportation Equipment
7.6 Fuels
8. Travel & Lodging –
$2.2B
8.1 Passenger Travel
8.2 Lodging
8.3 Travel Agent & Misc.
Services
9. Human Capital –
$4.7B
9.1 Specialized Educational
Services
9.2 Vocational Training
9.3 Human Resources
Services
10.
Medical –
$35.2B
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.1
Drugs and Pharmaceutical
Products
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.2
Medical Equipment &
Accessories & Supplies
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.3 Healthcare Services
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Category Management Governance Structure
Administrator
of OFPP
CMLC
The governing board for
Category Management
initiatives. Provides
government-wide direction
on CM strategy and
initiatives.
Category
Manager
Category
X
Category
Manager
Category
Y
Category
Manager
Category
Z
Category Managers
Experts in the category
(e.g., IT). They develop the
government-wide strategy to
drive improved performance
and act as change agents
for the category.
Category Manager
Category Lead C
Category
Team (L1)
L1 Category Team
Responsible for the
development and execution
of category strategies for a
specific Tier 1 category
(e.g., IT)
Category Lead
Agency C Rep
Category
Team (L2)
L2 Category Team
Responsible for the
development and execution
of category strategies for a
specific Tier 2 category
(e.g., IT software within the
IT category).
Chair
Agency C Rep
Commodity
Team
Commodity Teams
Traditional strategic
sourcing working group
formed when the
category management
process identifies the
need for a new
acquisition solution.
Category Management PMO Provides overall program management support to the groups and
individuals in the governance structure; facilitates the development
and implementation of business rules and processes.
Common Acquisition Platform (CAP) Develops and executes the IT strategy to support category
management business strategy via the Acquisition Gateway.
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Government Wide Category Managers Category Name Agency
IT Kim Luke OMB
Professional Services Tiffany Hixson GSA
Security and Protection Jaclyn Smyth DHS
Facilities and Construction Mary Ruwwe GSA
Industry Products and Services George Prochaska GSA
Office Management Greg Hammond GSA
Transportation and Logistics
Services Lisa Roberts DOD
Travel and Lodging Tim Burke GSA
Human Capital Robert Briede (Acting) OPM
Medical David J. Shulkin, M.D. VA
Dr. Jonathan Woodson DOD
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A closer look at Professional Services ➢ Largest sub-categories of spend:
• Management advisory services – $108.6B, or 56% of spend – Acquired through 14,000+ contracts and 130,000 transactions – 28.2% small business participation
• Technical and engineering services – $55.9B, or 29% of spend – Acquired through 3,500+ contracts and 40,000 transactions – 27.5% small business participation
➢ Product Service Codes (PSC’s) with the largest portion of spend were: • R499, Other Professional Services, $15.8B • R425, Engineering and Technical Services, $15.3B • R408, Program Management / Support Services, $7.7B • R699, Other Management Support Services, $3.1B
➢DHS and OSD are the leaders in use of existing contracts (overall) and could serve as leaders in the government-wide effort to reduce contract duplication
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Top Agencies of Spend ($B)
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Key Value Proposition to Agencies ➢The key value proposition is to reduce total cost management
for these services as well as “total cost of ownership” for the mission essential programs these services support. In FY16, to begin this work, three actions will be taken:
• A comprehensive analysis of agencies’ buying patterns will be completed including FPDS spend/obligations, transaction analysis, and identification of contract duplication
• Through the Acquisition Gateway and Professional Services Hallway, agencies will immediately improve their individual spend activity by identifying and using existing agency and governmentwide contracts, as well sharing best practices
• The interagency Professional Services Category Team will identify “best in class contracts” to position the government, in FY17, to improve the total cost of management for these contracts as well as competition and small business utilization
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Want to Learn More?
➢To Read Anne Rung’s Memo, visit Transforming the Marketplace: Simplifying Federal Procurement to Improve Performance, Drive Innovation, and Increase Savings.
➢See the power of acting as one by watching the Acting As One Video
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APPENDIX
Information on SUM definition follows (by characteristic)
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Leadership To what degree do individuals & organizations have clear
Category Management responsibilities? Tier Criteria*
Tier 1
• Designated Agency Category Lead with specific category expertise and day-to-day management and oversight responsibility (i.e. Program Manager for IT software contract; this is not agency CIO)
• Clear definitions of Government-wide Category Manager, Agency Category Lead, Category team roles
Tier 2
• Designated Part-Time Government-wide Category Manager (approved by OMB) --AND/OR--
• Designated Agency Category Lead --AND--
• Active participation on Interagency Category teams or Commodity Teams
Tier 3
• Designated Full-Time Government-wide Category Manager (approved by OMB) --AND--
• Government-wide Category Management Council Staffed by Senior Level Agency Staff (endorsed by Government-wide Category Manager)
--AND--
• Active Category Teams --AND--
• Government-wide PMO support
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Strategy To what degree has a clear acquisition strategy been
developed and implemented for the category?
Tier Criteria*
Tier 1
• Existing agency-wide solutions are being used, per mandatory use or consideration policies [For the following categories assessed, credit will not be given for new agency-specific solutions awarded after September 30, 2016 unless approved by the Government-wide Category Manager and meet strategic sourcing principals]
--AND/OR— • Policies are implemented and adopted that drive behavior changes (e.g., double sided
printing)
Tier 2
Meets at least 1 of 3 criteria: 1. Government-wide solutions in use, per mandatory use or consideration policies in place in
accordance with strategic sourcing principles outlined in OMB Memo M-13-02 2. Implements Gov-wide policies that drive behavior changes 3. Agency-wide strategic sourcing solutions in place in accordance with strategic sourcing
principles outlined in OMB Memo M-13-02
Tier 3 • CMLC approved category management strategy that endorses a limited number of “Best In
Class” solutions for the category
*Note: Additional detail on criteria included in draft SUM maturity model
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Tools To what degree are tools in place across the
agency/government to share information and reduce duplication of effort?
*Note: Additional detail on criteria included in draft SUM maturity model
Tier Criteria*
Tier 1 • Tools are in place and shared to capture and share information on the category, such as
contract vehicles, availability, terms/conditions, pricing, etc Examples: DHS Connect or DoD FedMall or GSA Advantage
Tier 2
• Worked with Government-wide Category Manager to populate the Acquisition Gateway with relevant information, including
1. Best In Class Agency Solutions; AND/OR 2. Government-wide strategic sourcing solutions (FSSI), GWAC, MAS, or MAC that are in
place in accordance with strategic sourcing principles outlined in OMB Memo M-13-02; AND/OR
3. Gov-wide Demand Management Policies that drive behavior changes --OR--
• Agency has developed a plan and milestone schedule, in coordination with the Category Manager, for providing data above
Tier 3 • Acquisition Gateway includes only solutions (acquisition vehicles and/or policies) that are
endorsed by Government-wide Category Manager as “Best in Class”
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Metrics
To what degree are metrics being used to track performance Category Management performance over time?
Tier Criteria*
Tier 1 Agency (or serving agency) tracks and has documented methodology for: • Savings • Small Business Participation
Tier 2
Tracks metrics quarterly for “Best In Class” FSSI, GWAC, MAS, or MAC solutions that are in place in accordance with strategic sourcing principles outlined in OMB Memo M-13-02 on: • Duplication reduction • Adoption • Savings and • Small business participation
Tier 3 Agency supports the Govt-wide collection/sharing of any other metrics outlined in an CMLC-approved Category Strategy
*Note: Additional detail on criteria included in draft SUM maturity model
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Government-Wide Category Structure (total FY 2014
spend $428B)