Originally Broadcast 8, 2008
Voice-Over: Welcome to The Business of Government Hour, a conversation about management with a government executive who is changing the way government does business. The Business of Government Hour is produced by The IBM Center for The Business of Government, which was created in 1998 to encourage discussion and research into new approaches to improving government effectiveness.
You can find out more about the Center by visiting us on the web at businessofgovernment.org.
And now, The Business of Government Hour.
Mr. Morales: Good morning. This is Albert Morales, your host, and managing partner of The IBM Center for The Business of Government.
Today, our nation's ability to sustain a growing economy and a rising standard of living depends in part on continued advances in science and technology. With one of the richest and most diverse missions in the federal government, the U.S. Department of Energy also represents the single largest supporter of research and the physical sciences seeking to enhance America's leadership in science and technology in the 21st Century.
In recognizing it cannot do this alone, Energy follows a solid acquisition and procurement strategy to meet its varied and complex missions.
With us this morning to discuss DoE's acquisition strategy is our special guest, Dr. Frank Spampinato, chief acquisition officer at the U.S. Department of Energy.
Good morning, Frank.
Dr. Spampinato: Good morning, Albert. Thank you for having me this morning.
Mr. Morales: Also joining us our conversation is Pete Boyer, director in IBM's Federal Civilian Industry Practice.
Good morning, Pete.
Mr. Boyer: Good morning, Al.
Mr. Morales: Frank, let's start off by learning a bit more about the Department. Many of our listeners are generally familiar with the U.S. Department of Energy, but could you give us a sense of the history and mission of the Department?
Dr. Spampinato: Sure. Our history can of course be traced back to the Manhattan Project in a race to develop an atomic weapon during World War II. And over time, as energy needs change and we went through a number of energy crises, it was realized that the numerous energy programs and agencies should be merged into a single agency, which created the Department of Energy, which was established in 1977. A combining of all these programs and agencies into one department not only enabled a better focus, but also allowed the Department to operate in a more dynamic manner, to shift its emphasis and focus on the needs of the nation as the nation changed, and over time, our energy needs have changed dramatically.
Just a short note about our mission, some of our priorities, DoE's mission, first of all, scientific and technological innovation, and driving U.S. competitiveness and maintaining scientific facilities. Another point to mention, nuclear security, this is the National Nuclear Security Administration, and they deal with non-proliferation and nuclear deterrence and threat prevention. Another facet of our mission is energy security, developing nuclear power and solar and biomass development, clean coal, hydrogen, and of course, last by not least, environmental stewardship. Environmental clean-up, and managing the legacy -- post-closure responsibilities.
So, that's basically in a nutshell our mission.
Mr. Morales: So with such a broad mission, Frank, can you give us a sense of the scale of operations over at DoE? You know, how you're organized, size of the overall budget? Perhaps in rough numbers in terms of full-time employees and contractors.
Dr. Spampinato: Well, DoE is principally a national security agency, and all of its missions flow from the core mission to support national security. These various missions are managed by program offices such as the Office of Environmental Management, the Office of Science, the Office of Energy Efficiency and Renewable Energy.
And after more than 30 years in existence, the Department now operates 24 research labs and facilities and 4 power-marketing administration, and manages the environmental clean-up from approximately 50 years of nuclear defense activities, and this impacts roughly 2 million acres in communities across the country. And of course, I'm part of this, the DoE Staff and Support Offices, which provide administrative management and oversight support to the DoE's program offices and assist them in successful accomplishment of the respective missions.
We have a budget of approximately $24 billion, with about 116,000 employees. Now, of that 116,000, roughly 16,000 are staff employees, 100,000 are contractors. And geographically, of course, we're a highly decentralized organization, with operations throughout the country.
Mr. Boyer: Frank, with that overview of the broader department, could you tell us more about your area and role within the Department? What are your specific responsibilities and duties as the chief acquisition officer, and could you tell us about the areas under your purview, how you're organized, the size of your staff, and your budget?
Dr. Spampinato: Well, I was created, in a sense, by the Services Acquisition Reform Act of 2004, where chief acquisition officers were created. And some of my duties in a more general sense are monitoring and evaluating performance of all acquisition activities and programs, increase in use of full and open competition, increasing the appropriate use of performance-based acquisitions, and managing the direction of acquisition policy. Basically, I am the top acquisition policy official in the Department. Some of the things that I've spent a considerable amount of time on are things like understanding and working on our removal from the GAO High Risk Series, helping facilitate the relationship between contract management and project management, working with the Department's Office of Small and Disadvantaged Business Utilization in facilitating opportunities for small businesses, reengineering the processes, the business processes and acquisition, and of course, working acquisition workforce issues.
I've seen my role over the past roughly 20 months largely as a catalyst for change, and what I will say with virtually all these issues, if it wasn't for the support of the Department's two top-notch professional senior procurement executives -- it's Ed Simpson, and in the NNSA, it's David Boyd -- if it wasn't for their support, I wouldn't be able to do what I do. You know, when I need resources or I need to look at something closer or need something explained to me, these two professionals take care of my every need.
Mr. Boyer: Regarding your responsibilities and duties, what are the top three challenges that you face in your position, and how do you address these challenges?
Dr. Spampinato: Some of the top challenges that I'm looking at now and while I've been there, first of all, of course, the acquisition workforce. Thinking about retention, recruitment, recognition. Being able to train people up, get them certified, determining what we have and what we need. You know, we only talk about numbers. We need more people, more people. What we really have to do is determine what we have, especially when we're a highly decentralized organization, and see what we have in the field in terms of competencies and what kind of skill gaps we have in the field and at headquarters.
The second item that I've been working on specifically is the GAO High-Risk Series, and our approximately 15-year existence on that particular list. For those who aren't familiar with the series, it identifies programs or projects that are high-risk due to vulnerability to fraud, waste, abuse, and mismanagement.
Specifically, we've been cited as "inadequate management in oversight of contractors and a failure to hold contractors accountable."
So when I came to the Department, I looked at what we had and what the Department had been doing in respect to measuring performance, and I really became a little frustrated because I believed then, and I still believe now, that we've really come a long way over time. We have a relatively robust, balanced scorecard program, which includes contract initiatives and appropriate measures and business process reengineering we've been doing, and we've been making a lot of progress. So I really had to kind of step back and take a look at it and see how an external person might look at what we had there.
So the first thing I did was I opened up a dialogue with OMB, the Office of Management and Budget and the Office of Federal Procurement Policy and General Accountability Office. And I was excited about the prospects, because it's always been my contention that too much policy is written without involving the stakeholders.
So I got an opportunity to do this. I've enjoyed engaging external stakeholders, and I enjoy a good working relationship with several fine and knowledgeable people from these organizations. I've also had the assistance of some of the best and brightest programming and contracts people in the Department to assist me.
We're still making significant progress. I really believe that we're looking at probably 2011 where we can actually be removed from that list.
And last but not least, I want to mention my small business advocacy role, and outreach in reporting with small business. Of course, the biggest part of my job involves acquisition-specific issues, but one of the most enjoyable parts of my job is working with small business.
I have a small business in my family, and I know how very hard they work. And incidentally, a small business in my family, that they don't hold any government contracts at DoE. I just want you to know that beforehand.
But a couple of things I do with small business: I do outreach, helping small businesses connect with customers through the business opportunity sessions we have, the small business conference which we hold each year, and just making individual contacts with the program.
By the way, we have a small business conference coming up this year in San Antonio June 23rd through the 26th, just in case anybody's interested in that. The other thing we do is reporting and accountability in terms of small business. We evaluate each program's performance, with quarterly reviews, and everybody is held accountable in terms of how they meet their program goals, whether they meet them or not.
The third part of this whole thing is education. We have to educate small business on the structure and the strategic direction of the Department and the contracting model, of course, and we have to basically educate Congress on everything also, because we got to keep -- like I say -- all stakeholders in the loop.
Mr. Morales: I understand that prior to this role at DoE, you had spent some time over at the CIA and DoD.
Could you just briefly describe your career path for our listeners? How did you get started?
Dr. Spampinato: I graduated a long time ago with an undergraduate degree in accounting, and I worked for five years in the private sector, and I just realized that I didn't really want to work in the private sector; I really wanted to kind of focus my professional life toward public service, and I always had desire to serve the publics, and I even ran for public office back in 1980, which seems like ages ago.
I didn't win, but I decided to enlist in the Marine Corps, and I was like the grand old man of the Marine Corps at the time. I was 27 years old. This was kind of a turning point for me, and started my public service life in a sense. After that, I just applied to a handful of federal entities, and was fortunate to wind up at the CIA for about the next 16 years, serving in mostly administrative positions. And of course, the other positions, I can't talk too much about.
to know about contracting, and did some work in other areas to gain a better perspective as to how everything fit together. After 16 years or so, I just wanted to do something a little different: different mission, different focus.
I had a good friend who served in the first four years of the Bush Administration, had a great experience. I had another friend who worked DoE, and had heard they were looking for a high-level acquisition-type to fill a political position. So I kind of got the White House personnel and the DoE liaison together, worked that over a couple months, a little while, and it's funny how things come together and finally did come together.
I'm exploring a handful of options out there, and I've thought about private sector, but in all likelihood, and in some capacity or another, I'll probably continue to serve the public. For the immediate future, it'll probably be as a career civil servant. But what I really want to do in the mid- to long-term is go back to New York, my home state, and serve the public as an elected official in some capacity. I'm not sure whether it'll be local, state, federal, but I would like to go back and have another run at office. I always said back when I did run for office in '80 that I would be back, but I didn't know it'd be 30 years from then.
Mr. Morales: We only have about a minute left, Frank, but I want to ask you: so as you look across that wonderful career, are there one or two experiences from that period that perhaps are informing your current leadership style and management approach?
Dr. Spampinato: You know, with all the training and all that I've had, that's all well and good, but one thing I did want to emphasize here is one of the biggest things I've learned over my career is it's not what or how much you know that's always important. It's taken a while to learn this, but like I say, it's probably a clich�, but life is all about relationships and how you relate to those around you. You know, the degrees, the big programs, the organizations, the positions you've held, that's all fine and good, good r�sum�, good calling card, but once you get into an organization, you have to produce, and your production will soar if you develop the business relationships you need to develop with your subordinates, your peers, and your superiors. And I think the position I currently sit in has really driven this point home for me.
Mr. Morales: That's a great lesson.
What about Energy's acquisition strategy? We will ask Dr. Spampinato, chief acquisition officer at the U.S. Department of Energy, to share with us when the conversation about management continues on The Business of Government Hour.
Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Dr. Frank Spampinato, chief acquisition officer at the U.S. Department of Energy.
Also joining us our conversation from IBM is Pete Boyer.
Frank, you gave us earlier an overview of your office and role, but could we go back and could you provide us a bit more details around the procurement function? Specifically, what are the key elements of acquisition management from the front-end solicitation to the post-award, and how does the procurement function fit into that process?
Dr. Spampinato: What I would like to say -- mention a couple of critical components in acquisition, and all the acquisition people out there are going to know exactly what I'm talking about, but a couple of things that are critical: first of all, a requirements definition. I mean, this has been a sore point I think forever in acquisition.
Requirements just do not get vetted as well as they have to, as they should, and we end up going back into acquisitions and extensive changes and cost growth, because we didn't work the requirement issues up front. We're under a lot of constraints these days, and one of those is time, and sometimes we just have to get things on the table and get them out the door, and sometimes we just do that in haste and it doesn't work. So, you know, a requirements definition is one of those real important things.
Another critical component is the program and the acquisition people working closely as a team.
Most of the organizations I've seen work hand in glove together, and that's when you get a good result from a procurement, but I've also seen program offices and contracting officers who work at odds, and I'm telling you, it makes the job real difficult, the program office doesn't get what the customer wants and it's just a real mess. So that's critical. That's another critical thing.
I recently worked with a lot of professionals, a lot of fine professionals in the Partnership for Public Service, putting out some tools for better contract management, and there has to be a lot more attention paid to managing, actual managing the contract.
Mr. Morales: It certainly is a challenging environment.
Now, I understand that you have over $20 billion each fiscal year in contracts and over 10,000 contract holders on GSA schedule contracts alone.
Could you elaborate on your Department's overall acquisition strategy? Specifically, can you tell us about the composition of your procurement portfolio and the ratio of prime contracting to maintenance and operations contracting agreements, and is this portfolio similar to what you might see in another federal agency?
Dr. Spampinato: Well, I don't think I could say we have one overall acquisition strategy because of the diversity and the differing complexity of the programs and acquisitions at DoE, but any contracting organization should have an overall philosophy as to how they are going to service the program offices, of course, and that philosophy should be one of realizing that we are a support function, and the reason for our existence is that we have customers, period.
I think this is a mistake that that's made out there amongst some organizations because of the fact that in the public sector a lot, we have a captive customer, which means that they don't have another service provider to go to. I had the opportunity to work in one of the few areas in government one time where the customer did have a choice. To me, it's amazing what competition will do to an organization's performance and innovative capacity. We knew we had to win these customers, and we did that. We went about doing that. So, I think it's more of a philosophy than really being able to talk about one strategy.
Now, if you want to talk about the procurement portfolio or the ratio of prime contracting to maintenance and operation contracting agreements, I think it's important to know that anywhere from 80 to 85 percent of our roughly $20 billion budget goes to our big management and operations contracts, our facility management contractors.
You know, when I first came onboard, I heard the words M and O, and I thought, oh, maintenance and operations, you know? Basically a contract with some base operations and contractor support. Well, to my dismay, I was wrong.
We even have a special place for management and operations contract and the FAR, and FAR Part 17, it's a contract under which -- for those who aren't familiar, it's a contract under which we have a government-owned contractor-operated facility, but the contractor is actually performing the mission of our agency instead of just providing support to run those facilities.
So it's easy to see that our predominant contracting model sets us apart from our fellow agencies and departments in the federal sector.
I love the opportunity to go out there and talk about the contracting model and how different it is for most.
Mr. Boyer: Frank, as noted, DoE is one of the largest civilian contracting agencies in the federal government, and in the first segment, you mentioned the GAO High-Risk List.
Could you tell us what you're doing to respond to GAO's concerns about delays in awarding contracts, and more importantly, can you expand on what you're doing to successfully remove DoE from GAO's High-Risk List?
Dr. Spampinato: Yes. I think these are kind of separate issues, even though the delays in award do probably contribute to our existence on the High-Risk List. We've taken many, many hits from external and internal stakeholders on our failure to award efforts in a timely manner. And rightfully so. I mean, even though we're looking at some efforts with a very high degree of complexity and sometimes in the billions of dollars, we need to do a much better job in awarding these in a timely fashion. And not only that, but we've got to make these things as much as we possibly can, these efforts more visible to the bidding public. And the other thing I always mention about this is, delays have a high impact on small businesses especially. You know, large businesses, big companies can kind of tread water sometimes for an amount of time and kind of wait until something comes out, until an RFP hits the street. But small businesses are really time-constrained and resource-constrained all around, so they're really impacted by this. Just another reason for us to take this really seriously.
Over the last 18 months or so, we've taken a closer look at the whole process. You know, we did a lot of interviews, talked to people, took the processes, tore them apart, looked at them. I mean, we've done a lot of work over the last 18 months, and we're in the final phases of communicating and implementing a corrective action plan that will move us toward awarding efforts in a more timely manner, and also providing more visibility to the public.
Now, on the high-risk front, just to mention that, we just completed a root cause analysis, which we received encouraging comments from our external counterparts, and at this point, we are also working on a corrective action plan to make sure that we do a better job in facilitating that relationship between project management and contract management. Fostering that relationship will help us get off of the high-risk list.
Now, I want to make it clear that the objective is not to get off the list. The objective is to work to make our project management and contract management processes work better and work better for everybody, but I think that will eventually help us get off the list.
Mr. Boyer: Terrific. Now, in an effort to increase the transparency and accountability in small business contracting, the U.S. Small Business Administration, the SBA, issues the Small Business Procurement Scorecard.
Now, we discussed the small business contracting as one of your challenges in the first segment.
Could you tell us more about this scorecard and what it tracks, and would you elaborate on DoE's performance in this area and the lessons you've learned?
Dr. Spampinato: Yes. The SBA scorecard tracks the actual achievement against the goal for each federal agency with regard to small business and socioeconomic businesses.
This goal is negotiated beforehand between the agency and the SBA, and I'd like to take a second, as a matter of fact, to talk about that. I want to commend SBA. They work very closely with us and take a real interest in understanding the model and the constraints we work under, so I really applaud their work with us.
To get back to actually what the scorecard is, to achieve a green, the Agency must achieve 100 percent of its small business goal, and meet at least three of the socioeconomic goals. To achieve yellow, they must achieve between 95 and 99 percent. They must also achieve 100 percent on progress as graded in 9 specific areas, such as senior level support, strategic plans, outreach efforts, et cetera.
I can proudly state that the Department was one of the seven agencies receiving a green on the initial SBA scorecard for FY 06.
A couple lessons learned that I've learned from this process, being involved in it.
First, you have to have a good detailed strategic plan for your program detailing the nine specific areas that you'll be judged in. Our OSDBU Office, under the direction of Ms. Theresa Speake, does an exemplary job of this. That strategic plan is a good plan, great plan.
Second, work very closely with the program offices, which includes helping educate them and holding them accountable.
Now, the other side of that is, we often say we have to educate them. We also have to become educated by them, because we have to understand their programs and any constraints or issues or acquisitions that have been delayed or canceled -- we have to understand also. So the education is kind of a two-way street. We educate them and help them, and they educate us also.
And, third, you just have to attack this effort on several fronts. I mean, outreach, monitoring, accountability, subcontracting. I like to say it's the big picture approach. You know, there's a lot of focus on just the prime number. What are your prime contracts, your percentage of prime contracts? But I think when you're dealing with --in subcontracting, we do maybe $2, $3 billion dollars per year in subcontracting for small business in the Department, and I don't think that's looked at sometime, and I really think we have to paint the total picture.
Mr. Morales: Right. So Frank, changing subjects just slightly, the environment is taking center stage these days, as it should, and the federal government has the ability to create and stabilize markets for recycled content products and other environmentally preferable products.
To that end, could you tell us more about the Green Procurement and the Federal Green Procurement Preference Program? Specifically, what could you tell us about what you're doing in this area?
Dr. Spampinato: Just to mention a couple of things, a couple of big things that are going on at Energy: first of all, the Department developed something called the TEAM Initiative, which stands for the Transformational Energy Action Management Initiative. And this was created by the Secretary, because he decided, rightfully so, that the Department of Energy should and would take the lead energy conservation, trying to be more environmentally-friendly.
So this imitative basically focuses on things such as reducing our energy consumption across the complex, across the Energy complex by 30 percent, having all new DoE construction or major renovations achieve a leadership in energy and environment design gold rating, a Leed's gold rating, as designated by the U.S. Green Building Council, and meeting or exceeding the Energy Policy Act requirement of having 7.5 percent of DoE's electricity provided by renewable energy by 2013.
Now, I guess you could call -- this one aspect of this initiative which involves contracts or acquisition is something called an ESPC. They play a major part in this. And ESPC is an Energy-Saving Performance Contract. This is another topic that could be a very extensive briefing. An Energy-Saving Performance Contract is a no upfront cost contracting method. A contractor incurs the cost of implementing energy conservation measures and is paid from the energy water, wastewater, and operational savings resulting from the measures. So basically, the contractor will come in, survey the facility, the entire facility, put forth a proposal, obtain financing, and then over the long run, will be paid from the cost savings out of that whole effort.
Now, as you can imagine, these are very long-term contracts, like maybe 20 years or so. Also, they require a large investment from the contractor, but these are just two items where the Department of Energy is really taking the lead on the Green Procurement efforts.
Mr. Morales: That provides some very powerful incentives.
How is Energy recruiting and retaining procurement professionals?
We will ask Dr. Frank Spampinato, chief acquisition officer at the U.S. Department of Energy, to share with us when the conversation about management continues on The Business of Government Hour.
Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Dr. Frank Spampinato, chief acquisition officer at the U.S. Department of Energy.
Also joining us in our conversation from IBM is Pete Boyer.
Frank, in recent years, the size of the acquisition force has remained somewhat stagnant while procurement spending has certainly increased. Now, it's pretty well-known that agencies have had the ability to rehire retired acquisition personnel, but only a few agencies have really sought to formally use this authority.
Could you elaborate on the benefits as well as perhaps some limitations in pursing this type of strategy? But more importantly, do you have plans to use this authority to fill some of the staffing needs you may have?
Dr. Spampinato: First of all, I'd like to say I think the solution to our workforce crisis is not going to come through one big idea, I think it's going to be a lot of smaller ideas. I think it's a good strategy and it'll accrue substantial benefits in the area more of mentoring and training.
I learned contracts from the ground up and I had a lot of good people teaching me that. These days, we don't have those people, we don't have the 7 to 10 years, 7 to 12 years experienced people in the numbers that we need to teach the new contracting officers.
So if we hire the new ones who want to come in and just knock out contracts, I mean, that's fine, but I think the biggest gains are the gains that we'll accrue through knowledgeable, experienced mentors, and we're currently working to try to develop policy on this, and I think we're definitely looking to utilize this in the future.
Mr. Morales: So, as you say, it's really just one of perhaps a portfolio of different strategies that you guys can take?
Dr. Spampinato: I think they're going to be a lot of things, things that we haven't probably even invented yet, unless you're stealing them from another agency or department.
Mr. Morales: Well, it's interesting you mention that, because along those lines, I understand that some of the acquisition staff doesn't necessarily leave to go to the private sector, but in fact, there's a fair amount of movement in between agencies as people are chasing more attractive pay.
So what issues does such a situation present for federal agencies, and what can the acquisition community do to devise a common set of incentive for all agencies that will help share this limited wealth of acquisition talent?
Dr. Spampinato: I think that's a great question. You see this all over the government. Agencies and departments are able to offer differing levels of benefits, like relocation, tuition reimbursement, those types of things, and since every agency needs people, we sometimes find that, at DoE, we'll get people in, get them all trained up, and see them leave for someone who can offer some of these amenities.
The two concerns for me in this area are, first, we often aren't one of those agencies who can offer some of these nice perks. Second, and more important I think are the long-term implications for the acquisition career service. When I entered the career service 20 years ago, promotions happened, but we had more of an opportunity to learn before promotions came, I think. I learned different types of contracts, programs, how we interacted with other administrative functions, all types of contracts. So by the time I got to GS-15, I had a real good foundation. And not just training-wise, but kind of boots on the ground training, the everyday trials and tribulations of contract administration and that type of thing.
But, today, our newer entrants into the workforce are very bright, and I like to see these young colleagues promoted just as much as anyone else does, but my concern is that I think we're moving some of them on too fast, moving them along, filling where we desperately need people in slots, we're filling them. But I'm concerned in the long-term, some of these COs will be called to step up to leadership positions in the career service, and I'm afraid that they'll be at a bit of a deficit, because they haven't had some of that foundational training that others have had.
Mr. Morales: It is a riskier approach, both for them individually as well as the organizations they serve.
Mr. Boyer: Now, Frank, given the complexity and importance of DoE's numerous unique and complex multi-million-dollar projects, from an acquisition management perspective, how has your Department sought to improve its project management discipline and structure for monitoring project performance?
Dr. Spampinato: This area is very critical to the Department, especially project management, because over time, if I might mention, the GAO High-Risk Series has evolved from a heavy focus on contract management to a heavy focus on project management with a little bit of a focus on contract management. So this is critical to the Department, and in that vein, we've brought in a top-notch director of the Office of Engineering Construction Management, Paul Bosco; has a lot of DoD experience in this area. Top-notch guy, and we do a lot of -- I'm not intimately involved with the processes so I can't specifically say, but we do a lot of independent project review. If it's a highly-complex effort, we do a technical independent project review. We do external independent reviews.
So I think what I'd like to stress is that we do review these major complex projects, and these reviews are independent reviews, okay? Just focus on independence, which of course is a good thing. I think we're really making some great changes in this area, and as a matter of fact, Paul has taken the lead on our root cause analysis that we're putting together right now. I'm really encouraged by the direction that we're taking in this area.
Mr. Boyer: Balancing the appropriate number of DoE contracting officials with the growth of your portfolio is always a challenge.
To that end, what changes have you made to your recruitment process to attract quality employees who possess critical competencies?
Dr. Spampinato: While my eye is more focused on the acquisition workforce, I think it'd be fair to say that this question should also mention how the portfolio might have changed in complexity, not only in how big the portfolio has become. So this would tell us not only that maybe we need more people. We do need people. But the skills mix of the people that we do need might be quite different from the skills mix we needed 5, 10, 15 years ago.
For instance, in acquisition around the 1990s, the Department had roughly twice the number of M and O contracts as they have today. So in the early '90s, it might be appropriate to say we needed fewer government contracting personnel to administrator contracts because they just weren't needed at the time.
Now, fast-forward to 2007, the number of M and O contracts is about half of what it was in the '90s, and most of those contracts have been replaced with performance-based vehicles, incentive vehicles, and we've also seen an increase, a big increase in prime contracts over time to small businesses.
So this might tell us we'll need more government personnel, but in addition to how many, again, we have to think what type of personnel do we need. This is where the competency surveys and the gap analyses that are currently going on out there, this is where they come into play, and this is currently an ongoing effort. Now, in terms of compensation strategies, my take is that while we have the ability to do some of these things, and we do, they're often not fully funded, so therefore, even though you have the ability, they're just not going to happen.
Breaking good news is that this year, we've been able to put an additional considerable amount of resources into our Acquisition Career Development Program, and this is very encouraging for us, especially when you have a workforce that you have to have certified and recertified and it's very training-intensive, as you know, the acquisition workforce. So we're very encouraged by the additional money that we've retained in our budget for this.
Mr. Boyer: That's terrific. In a similar vein, we understand that it's critical to keep your procurement and acquisition staff engaged.
Could you tell us more about the Department of Energy Procurement Executive Award Program, and in what ways does it seek to recognize innovation and overall excellence in the DoE acquisition community?
Dr. Spampinato: That's a great question, keeping the acquisition workforce engaged. This specific program was set up to recognize employees, contractors as well as staff in acquisition and property management workforce who go above and beyond the call of duty in their jobs, promoting such things as innovation, excellence, efficiency, being creative. I mean, recognition is always a great way to keep personnel engaged, and I believe the procurement executives at DoE recognize that and do a great job of it.
But in addition to this, I might add also something I've learned throughout my acquisition positions throughout the government, another way to keep the acquisition professionals engaged is to keep them close to the mission. I've seen this both at DoE and in my days in the intel community, especially if you're operating at a procurement function which is geographically removed from the mission, and you might be purchasing relatively small and seemingly insignificant items -- you know, visits to customer sites.
We used to have things, mission tapes that would show exactly what was going on, what we were supporting, space vehicles we might be supporting, what was going on out there. Something that just reflected the end results of our efforts, and people would look at that and say wow, they purchased something for that satellite? You know, this is also kind of multi-faceted thing to keep acquisition workforce engaged, and I think it's critical to keep them close to the mission.
Mr. Morales: Frank, I want to go back to your description from an earlier segment of the Department workforce. I believe you characterized it as about 116,000 employees across DoE, and about 16,000 of those were government employees.
Could you tell us how managers can effectively manage this ever-increasing blended workforce? What are some of the key differences intrinsic to these two groups, and how do you manage this, especially as it relates to the work that you do at the labs?
Dr. Spampinato: Personally, I can't speak for the entire organization, but one thing I do believe is that the DoE contracting model will and must remain intact. Even though there are definitely areas which can withstand reform and the Department has been slowly but surely doing this, as evidenced by a huge increase in the number of incentive-type performance-based contracts over time, I don't see in the near future where the resources will become available to achieve the Department's mission in a different way.
But regarding the blended workforce, I think this is a discussion that seems like it's been around for awhile, but I think serious discussion on the blended workforce has really started, and I think it's got to take place in another context that I'd like to mention.
There was talk a while back about taking a fresh look at the term "inherently governmental." I think this is more important than most think. If we don't receive the resources or types of resources that we need in the near to mid-term, my question is, what work do we stop doing? Understandably, we're not going to resolve this workforce issue, workforce crisis, like tomorrow, but if we don't start to solve this thing, okay, what are we going to stop doing?
There's always talk of cutting staff here, cutting contractors there, while acquisition budgets continue to rise. So who's going to do the work? While we must determine how many and what type of people we need, maybe we have to take a serious look at what is inherently governmental. The situation has changed drastically since this was first defined, and I know the General Accountability Office has been talking about this a bit and looking at it, and I think we have to really take a serious look and decide who's going to do the work out there.
Mr. Morales: It's certainly a challenge.
What does the future hold for the U.S. Department of Energy's acquisition function? We will ask Dr. Frank Spampinato, chief acquisition officer at the U.S. Department of Energy, to share with us when the conversation about management continues on The Business of Government Hour.
Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Dr. Frank Spampinato, chief acquisition officer at the U.S. Department of Energy.
Also joining us in our conversation from IBM is Pete Boyer.
Frank, since acquisition is a fiduciary responsibility, the federal government business must be conducted with complete impartiality.
Could you elaborate on efforts being pursued to ensure procurement integrity, making sure that proper standards of conduct, ethical and legal requirements, are being followed by the federal acquisition staff?
Dr. Spampinato: My position on this point is not a mystery since I talk about this probably every time I speak. Eventually, people get tired of hearing it, but frankly, I truly believe that we have enough regulations and laws to appropriately protect the American public and catch those who would act criminally.
People are always attempting to clean up contracting or to make contracting officers competent. I don't believe that contracting needs to be cleaned up or contracting folks need to be made competent. In fact, with my level of education and training and that of the people I've worked beside, I sometimes take a little bit of offense to some of these efforts to make us competent.
You have to have a thick skin around here. You had Katrina and the war, and they really tax the system, and people made mistakes, and plenty were made, believe me, but mistakes are a far cry from criminal conduct, and those criminally inclined are eventually caught up with and prosecuted. But to look at all acquisition professionals as potential criminals - sometimes it seems like that. I think it's wrong and it's counterproductive to what we're trying to accomplish.
We're never going to solve this workforce crisis if the rules, the regs, and the oversight keep on coming. I believe in appropriate oversight, but these days, it just keeps coming and coming, and sometimes, it just doesn't seems there's any logical reason for it.
Mr. Boyer: What kinds of partnerships are you developing now to improve operations or outcomes at DoE, and how many of these partnerships change over time?
Dr. Spampinato: First of all, I think you're going to see more collaboration in the future amongst everyone, and I think the continuing workforce crisis will be a huge factor in this respect.
Even though we haven't had much time to work on this lately, I've begun building a relationship with the intelligence community via the DNI's procurement executive, Theresa Everett. She's a great person to work with, and I really think that even though you've got that veil there, you've got to be careful, but there are a lot things that can be shared between them and us. We've talked about -- she's been very gracious to include me in goings on in the IC, and she's had conversations with some of our people in grant management, and so I think we're sharing across those lines.
And I also believe that, over the past 18 months, I've played a part in building stronger relationships with our external customers: OMB, GAO, SBA, Capitol Hill. I think this is an effort that really has to be nurtured and continued over time, and it's very easily overtaken by events. But it should take priority, and over time, I believe we'll become more open and more willing to share information. Maybe that's just a hope, but I'm hoping, though I'm not sure it will happen, that we'll not only dialogue, but we'll attempt to understand each other in terms of some of the capabilities and the constraints of some of our organizations.
Mr. Boyer: Now, looking into your crystal ball and transitioning more to the future, would you give us a sense of some of the key issues that will affect acquisition and procurement offices government-wide over the next couple of years?
Dr. Spampinato: I think the workforce crisis is going to continue to be an issue. We're going to have to work hard to repopulate the 7 to 12 years of experience segment of the workforce. We're going to have to be more creative, innovative. I don't think there's a silver bullet here to solve this, but it's going to consist of a combination of solutions, so I think the crisis is going to be with us for a while.
The second thing is, additional regulation oversight will become a bigger issue, especially as it interacts with the workforce crisis. I believe there's an inverse relationship there, and I think as regulation oversight increases beyond what is perceived to be needed -- I mean everybody's got a different view of that -- this is eventually going to have a negative impact on our efforts to rebuild and modernize our workforce.
Mr. Morales: So Frank, just drilling down a bit more, what are some of the major opportunities and challenges that your organization specifically will encounter in the future, and how do you envision your area will need to evolve over the next couple of years?
Dr. Spampinato: In terms of just a couple of opportunities, and I think we've mentioned these, but first, I think we should continue to work as one community as often as we can to share creative and innovative practices with each other. I not only look at this as a great opportunity, but it'll be a must to really move this profession and the government forward and better serve the American public. This includes, like I said, working with the intel community and working with as many people as we can get out there, working closely with industry, getting ideas, giving ideas, working closely.
The other thing is wherever I go, of course, after this, I'm going to try to continue to work with the people that I have met, and the CAO Council and Department of Energy and the intel community -- I still work with people back there, so I think that's how incrementally, we solve some of these issues we have. We just keep working with each other.
Right along with that are the continuing opportunities to bring in young, bright talent into our agencies. We have the opportunity today and have to remember that even though we really have the deficit in the middle ranks, we can't lose sight of bringing in the best and brightest of today. This will foster our first opportunity really to work together, because frankly, I think new workers are more prone to working across agency boundaries, and will look at this kind of thing as almost a given. So I think we're going to gain from that.
In terms of the challenges, first, the time it will take to populate the middle ranks, 7 to 12 years of experienced, it's going to be a while. We've got to be patient, we've got to move deliberately on this thing. But we've got to be patient with solving this problem.
The second, oversight must be done. Don't get me wrong. Sometimes we don't look at the value added. We have the mentality that more is better, and to me, that's just counterproductive. More is not better. We really have to look at it and see what we're gaining from the whole process, especially when we're trying to solve a workforce crisis.
Think about it. Would you want to work somewhere where people were constantly looking over your shoulder just waiting for you to do something wrong? Especially where we have such a highly-educated and highly ethical workforce.
Mr. Morales: Frank, you've had, obviously, a very successful career within the public sector, and you've conveyed a very strong passion for the work that you do.
So I'm curious, what advice might you give to a person who's out there thinking about a career in the public service?
Dr. Spampinato: I think what really keeps me motivated and working in the acquisition field specifically is the nature of the workforce and the dynamic nature of acquisition itself. First, regarding the workforce, I feel like I work beside some of the most highly-educated, professional, and ethical people in the federal government, and in my 20 years, the members of this workforce continue to inch the bar higher and higher.
And secondly, it's a dynamic profession. The only thing constant, as they say, is change. And a lot of this change is self-imposed to better acquisition. We're always changing, we're always trying to make things better, so it's a profession that doesn't stand still. I really love doing it. Bottom line, if you want to work with a highly-professional workforce in a field that welcomes change, acquisition is the place to be.
Mr. Morales: That's great. Thank you.
Frank, unfortunately, we have reached the end of our time. I want to thank you for fitting us into busy your schedule today, but more importantly, Pete and I would like to thank you for your dedicated service to our country and the acquisition community.
Dr. Spampinato: Thank you very much, Al. I appreciate that. And thank you, Pete, for being such great hosts. Just a couple of things I'd like to mention here. For more information on what I talked about, and there's a lot more great information for you on DOE's website, which is www.doe.gov.
The second thing I want to mention is again the Small Business Conference is going on in San Antonio June 23 through June 26. If you're interested in that, please contact our Small Business Office on the website.
And last, but not least, please feel free to contact me at any time. It's very easy to find my contact, email@example.com, and I'll answer any questions I can or just direct you to the right person.
Mr. Morales: Great, Frank. Thank you.
This has been The Business of Government Hour, featuring a conversation with Dr. Frank Spampinato, chief acquisition officer at the U.S. Department of Energy.
My co-host has been Pete Boyer, director in IBM's Federal Civilian Industry Practice.
As you enjoy the rest of your day, please take time to remember the men and women of our armed and civil services abroad who may not be able to hear this morning's show on how we're improving their government, but who deserve our unconditional respect and support.
For The Business of Government Hour, I'm Albert Morales. Thank you for listening.
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