Federal Acquisition: Trends, Reforms, and Challenges (Testimony,
03/16/2000, GAO/T-OCG-00-7).

Pursuant to a congressional request, GAO discussed federal acquisition
issues, focusing on: (1) the changing acquisition environment; (2)
recent reform efforts; and (3) current and future challenges in this
area.

GAO noted that: (1) federal spending for goods and services has changed
significantly in recent years; (2) although the Department of Defense
remains the dominant federal buyer, accounting for two-thirds of all
federal acquisition spending last year, defense acquisition has declined
from peak Cold War levels; (3) spending by civilian agencies has
increased moderately; (4) the government as a whole now spends more on
services--ranging from basic maintenance, to running computer systems,
to operating the space shuttle--than on supplies and equipment; (5) the
acquisition process has become more streamlined as new contract vehicles
and techniques have allowed agencies to buy what they need much faster
than in the past; (6) Congress and the administration have taken a
number of steps recently to improve federal acquisition; (7) these
efforts have focused largely on simplifying the process, particularly
for buying commercial products and services, and on attempting to
improve decisionmaking in acquiring information technology; (8) but
despite recent reforms and the efforts of many dedicated people over the
years, the government still does not have a world-class purchasing
system; (9) all too often, many of the products and services the
government buys cost more than expected, are delivered late, or fail to
perform as anticipated; (10) no commercial business would remain viable
for very long with results like these; (11) problems are particularly
evident in the two areas where most of the dollars are spent: (a)
weapons; and (b) information technology systems; (12) significant
improvements in these areas--as well as in the skills of the acquisition
workforce--are needed in order to produce better outcomes; and (13) GAO
has made a number of recommendations over the years to improve
acquisition outcomes, including the use by federal agencies of best
commercial practices.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  T-OCG-00-7
     TITLE:  Federal Acquisition: Trends, Reforms, and Challenges
      DATE:  03/16/2000
   SUBJECT:  Federal procurement
	     Federal procurement policy
	     Cost control
	     Procurement planning
	     Defense procurement
	     Risk management
	     Private sector practices
	     Internal controls
	     Strategic information systems planning
IDENTIFIER:  B-2 Aircraft
	     C-17 Aircraft

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United States General Accounting Office
GAO

Testimony

Before the Subcommittee on Government
Management, Information, and Technology
House Committee on Government Reform

For Release on Delivery
10:00 a.m. EST
Thursday
March 16, 2000
GAO/T-OCG-00-7

FEDERAL ACQUISITION
Trends, Reforms, and Challenges

Statement of Henry L. Hinton, Jr.
Assistant Comptroller General
National Security and International Affairs
Division

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Statement
Federal Acquisition: Trends, Reforms, and
Challenges
Page 16                            GAO/T-OCG-00-7
Mr. Chairman and Members of the Subcommittee:

I appreciate the opportunity to be here today to
participate in the Subcommittee's hearing on
federal acquisition issues.  Federal acquisition
is an important topic for many reasons, not the
least of which is the huge amounts of money
involved.  The federal government spends nearly
$200 billion annually buying everything from
office supplies to sophisticated weapons systems.
But more importantly, agencies' success in
efficiently acquiring goods and services directly
affects their ability to improve government
operations and provide better service to the
American people.  Uneconomical, inefficient, and
ineffective acquisition activities undermine the
public's confidence in government and waste
taxpayer dollars.

My statement today will

ï¿½    describe the changing acquisition
environment,
ï¿½    summarize recent reform efforts, and
ï¿½    explore current and future challenges in this
area.

The reports I will refer to, as well as several
others we have issued on this subject, are listed
in attachment II.

Summary
Federal spending for goods and services has
changed significantly in recent years.  Although
the Department of Defense (DOD) remains the
dominant federal buyer, accounting for two-thirds
of all federal acquisition spending last year,
defense acquisition has declined from peak Cold
War levels.  Spending by civilian agencies has
increased moderately.  The government as a whole
now spends more on services-ranging from basic
maintenance, to running computer systems, to
operating the space shuttle-than on supplies and
equipment.  The acquisition process has become
more streamlined as new contract vehicles and
techniques have allowed agencies to buy what they
need much faster than in the past.

Congress and the Administration have taken a
number of steps recently to improve federal
acquisition.  These efforts have focused largely
on simplifying the process, particularly for
buying commercial products and services, and on
attempting to improve decisionmaking in acquiring
information technology.  But despite recent
reforms and the efforts of many dedicated people
over the years, the government still does not have
a world-class purchasing system.  All too often,
many of the products and services the government
buys cost more than expected, are delivered late,
or fail to perform as anticipated.  No commercial
business would remain viable for very long with
results like these.  Problems are particularly
evident in the two areas where most of the dollars
are spent: weapons and information technology
systems.  Significant improvements in these
areas-as well as in the skills of the acquisition
workforce-are needed in order to produce better
outcomes.  We have made a number of
recommendations over the years to improve
acquisition outcomes, including the use by federal
agencies of best commercial practices.

The Environment
Before discussing recent changes in federal
acquisition in detail, I would like to make a
point about the overall government environment of
which acquisition is a part.  That is, despite
today's budget surpluses, the federal government
continues to face compelling fiscal pressures.
These pressures are likely to continue, if not
intensify, particularly in the long term as we
address issues such as Social Security and health
care for an aging population.  Bills also will
become due for other efforts, such as
environmental clean up, and the DOD plans to spend
over $350 billion on three new tactical aircraft.
After a decade of deficit reduction, there are
numerous other pent-up demands for using projected
budget surpluses.  What this means is that
government acquisition, a major component of
discretionary spending, will have to compete with
other funding priorities for scarce federal
resources.  It is therefore all the more critical
that we distinguish between wants and needs, focus
on what we can afford, and obtain maximum value
and return on taxpayer dollars.

Let me now provide you with some details on how
the federal acquisition environment has changed in
recent years.  Using constant 1999 dollars, figure
1 shows that overall federal contracting has
declined from about $280 billion in fiscal year
1985 to about $200 billion in fiscal year 1999.
During this period, defense acquisition declined
nearly $100 billion, and civilian agency
acquisition increased $14 billion.  As a result,
the percentage of total contracting dollars spent
by civilian agencies has increased from about 18
percent in fiscal year 1985 to about 33 percent in
fiscal year 1999.

Figure 1:  Defense and Civilian Agency Contracting
Dollars Since the Mid-1980s (in Constant 1999
Dollars)

Source: All actions reported to the Federal
Procurement Data System.

Although defense acquisition has declined, DOD is
still the dominant purchaser in the federal
community, accounting for about two-thirds of
contracting dollars in fiscal year 1999.  Figure 2
shows the top 10 federal agencies, in terms of
contracting dollars, in fiscal year 1999.

Figure 2:  DOD Was the Dominant Purchaser in
Fiscal Year 1999

Note:   Some agencies do not report to the Federal
Procurement Data System.  The largest of these
agencies, the U.S. Postal Service, spent $9.1
billion on goods, services, and construction in
fiscal year 1999.
Source:  All actions reported to the Federal
Procurement Data System.

Since the mid-1980s, there has been a gradual
shift in what the government buys.  In constant
1999 dollars, figure 3 shows that, in fiscal year
1985, supplies and equipment accounted for the
bulk of contracting dollars-about $145 billion, or
56 percent-compared to services, construction, and
research and development.  By fiscal year 1999,
the largest acquisition category was services at
$78 billion, or 43 percent of total spending.
Supplies and equipment expenditures were about $64
billion, or 35 percent. Construction spending
remained about $16 billion.  Research and
development declined in constant dollar terms from
$36 billion to $25 billion, but declined only
slightly as a percentage of total acquisition
spending.

Figure 3:  The Bulk of Contracting Dollars Have
Shifted From Supplies and Equipment to Services
(Constant 1999 Dollars)

Source:  Federal Procurement Data System.  These
data reflect actions reported to the Federal
Procurement Data System, generally excluding those
less than $25,000.

The result of this gradual shift in what the
government buys is more dramatically displayed in
figure 4.  The government now spends more for
services than for any other acquisition category.

Figure 4:  Comparing Fiscal Year 1985 With Fiscal
Year 1999 Shows the Bulk of Contracting Activity
Has Shifted

Source:  Federal Procurement Data System.  These
data reflect actions reported to the Federal
Procurement Data System, generally excluding those
less than $25,000.  The percentages for 1985 do
not total to 100 due to rounding.

One of the top items in the services category is
professional, administrative, and management
support.  Such services would include, for
example, a DOD contract for strategic business
process reengineering used to acquire contractor
assistance in improving business practices and to
obtain support for strategic planning, investment
analysis, and training.  Another large component
of services contracting involves managing and
operating government facilities, such as national
laboratories.  The top items in the supply and
equipment category in fiscal year 1999 were
aircraft and information technology.

In addition to changes in what the government
buys, we also are seeing changes in how the
government buys.  Agencies are making greater use
of contracts awarded by other agencies, as well as
federal supply schedule contacts1 awarded by the
General Services Administration (GSA).  Use of
these types of vehicles can reduce acquisition
time significantly.  For example, a recent GSA
study found that it takes only 15 days, on
average, to issue an order under a schedule
contract versus 268 days to award a contract using
the traditional method.  Use of GSA federal supply
schedules has grown from $4.5 billion in 1993 to
$10.5 billion in 1999.  Most of the growth has
been in the area of information technology.

So what does all this mean, what are the
implications of these data, and what can we expect
in the future?  Taken together, the data tell us
that the federal acquisition environment is now
characterized by a greater reliance on services
and information technology.  In many ways, these
trends in government procurement merely reflect
changes in the overall global economy.  Because
the government is but one of many players in this
services- and information-driven economy, it will
have to become a smarter, more commercial-oriented
buyer.  At the same time, the government continues
to spend enormous amounts in markets where it
remains the only-or at least the dominant-buyer,
such as procurements of unique defense and space
systems.  It is in these areas where vigorous
oversight will continue to be needed because
competition in these markets often is limited and
the government frequently relies on contractor
costs in the pricing of contracts.

As we look to the future, there are several trends
that bear watching.  Contracting for services
likely will continue to increase because of
further downsizing and initiatives such as the
Federal Activities Inventory Reform Act of 1998
(FAIR).  This legislation requires agencies to
identify functions that could be performed by the
private sector.  Agency spending on information
technology-related goods and services, currently
about $40 billion annually, likely will increase
as agencies seek to modernize their equipment and
continue to take advantage of the latest
technologies.  Also, recent budget projections
indicate that spending on acquisitions of major
defense equipment will likely increase.

We should also expect that electronic commerce
will become the preferred approach for
accomplishing a variety of procurement tasks,
ranging from conducting market research, to
selecting suppliers, to placing orders, to making
payments online.  The Administration has
encouraged agencies to use electronic commerce to
streamline and improve federal buying practices.
With the proliferation of Internet use throughout
government, industry, and the public, agencies are
seeking to capitalize on electronic commerce
capabilities to improve efficiency and economy.
At the same time, agencies must understand and
manage the challenges and risks of using a global,
public, electronic network.  To avoid loss of
public trust, agencies must strive for
reliability, integrity, security, and privacy in
all electronic commerce transactions.

Acquisition Reforms
For decades, the federal government has been
struggling with an inefficient acquisition system
and the resulting negative impact on agency
operations.  There also is a long history of
attempts to improve the acquisition system.
Attachment I displays these efforts in a timeline.
The 1980s, in particular, witnessed a
proliferation of requirements governing almost
every aspect of the acquisition process.  Some
were in response to the stories of excessive
prices paid for military spare parts, criminal
activity, the frequency of cost overruns, and
increasing acquisition delays.

These requirements were enacted to serve valid
purposes.  For example, the Competition in
Contracting Act of 1984, which established the
current competitive acquisition system, was
enacted after years of congressional concern that,
rather than seeking competition, executive
agencies relied on sole-source contracts to an
unacceptable extent.  Audit requirements and cost
principles were established to control what the
government pays under its contracts.
Socioeconomic requirements were designed to
promote desirable social objectives, such as
enhancing small and minority business
participation.  In 1988, the Procurement Integrity
Act was enacted to ensure that procurement
officials do not engage in employment discussions
with companies with which they are negotiating
contracts or give inside information to
contractors.

When all these requirements-as well as others
imposed by regulation-were added together,
however, some came to believe that the result was
a complex and unwieldy system that had become
overwrought with tension between the basic goals
of efficiency and fairness.  Government
contracting officials were confronted with
numerous mandates that left little room for the
exercise of sound business judgment, initiative,
and creativity in satisfying the needs of their
agency customers.  In this environment, there were
concerns about the government's ability to take
full advantage of the commercial marketplace.

In response to these concerns, Congress enacted
two pieces of reform legislation: the Federal
Acquisition Streamlining Act (FASA) of 1994 and
the Clinger-Cohen Act of 1996.  Table 1 summarizes
the major changes that were implemented under FASA
and the Clinger-Cohen Act.

Table 1:  Major Changes under FASA and the Clinger-
Cohen Act
   Federal Acquisition Streamlining Act of 1994
                      (FASA)
Exempted commercial items from many unique
government requirements
Promoted use of simplified buying procedures for
low dollar-value purchases
Encouraged use of electronic commerce
Established statutory framework for task- and
delivery-order contracts
            Clinger-Cohen Act of 1996
Devolved information technology procurement
authority from GSA to agencies
Emphasized accountability, performance, and
results-based IT management
Allowed contracting officers to select competitive
contractors more efficiently
Promoted improved performance of the civilian
agency acquisition workforce

Congress also has taken other actions to provide
agencies more flexibility in acquiring goods and
services.  For example, Congress has permitted the
Federal Aviation Administration to devise its own
procurement system outside the usual statutory
framework.  It also has allowed some agencies to
use alternative approaches to contract through so-
called "other transactions."  These agreements
generally are not subject to federal laws and
regulations governing standard procurement
contracts.  One of the intended benefits of using
this authority is to attract commercial firms and
other organizations that otherwise might not
accept a standard contract because of government
requirements that they view as unduly burdensome.

In addition to these legislative changes, there
have been a number of administrative and
regulatory reforms.  These include reducing
government-mandated product specifications,
increasing the use of government purchase cards,
and encouraging flexibility and innovation in
negotiating contracts.

The United States is not alone in implementing
reforms.  As you know, Mr. Chairman, we issued a
report to you and Congressman Tom Davis last July
that discussed procurement reform in four selected
countries.  These countries-Canada, the United
Kingdom, Australia, and New Zealand-have
reassessed the role of their central procurement
agencies, empowered civil servants to make
business decisions, and shifted to greater
reliance on the private sector.  Although
officials in these countries generally were
satisfied with the changes, performance data on
the effectiveness of the various changes were not
yet available.

As with these other countries, it is difficult to
provide a full assessment of the impact of reforms
because many of them are still being implemented.
And, in some cases, there is a lack of reliable
baseline data.  For example, we reported that it
was difficult to measure any increase in the
government's purchases of commercial items since
the 1994 acquisition streamlining act because
reliable baseline data were not available.
Nevertheless, we are seeing some changes.
Agencies have streamlined their acquisition
processes, particularly by using governmentwide
acquisition contracts and schedule contracts, and
thus can get what they need faster.  There has
also been an increase in agencies' use of purchase
cards and electronic commerce as a means of
quickly accessing goods and services.

Questions remain, however, about whether these
efficiencies have come at the expense of
competition and good pricing.  For example, we
have found that DOD receives few competing
proposals on large information technology orders.
We also have reported that some contracting
officials are having difficulty making the
transition from pricing goods and services based
on the costs incurred by contractors to a
commercial model in which factors other than cost
are the principal means used to establish prices.
This sometimes resulted in significantly higher
prices than previously paid.  For example, a
defense agency paid $453 per unit for wiring
harnesses for the C-130 aircraft, even though it
had paid only $91 per unit 2 years earlier.  The
buyer did not use this price history to try to
negotiate a lower price.  In addition, our reviews
of delays and cost overruns at the Department of
Energy's (DOE) Idaho and Hanford facilities
suggest that DOE personnel lack expertise in
administering fixed-price contracts.

Major Challenges
Agencies may be acquiring goods and services
faster, but the federal acquisition system still
faces a number of significant challenges.  In our
view, the most significant challenges involve
three key areas: improving the outcomes of defense
systems acquisitions, acquiring and using
information technology, and addressing acquisition
workforce issues.  In each of these areas, much
can be gained from reviewing the practices of
leading commercial companies who have learned to
use key enablers-process, people, and
technology-to produce better outcomes.

Defense Systems
The acquisition reforms to date have focused
largely on simplifying the procurement process,
particularly for commercial and lower dollar-value
items.  Our work indicates, however, that far too
often the outcomes of high dollar-value
acquisitions continue to fall short of
expectations.  When we compare government
acquisition practices to those of leading
commercial companies, it is clear that we still
have a long way to go.

For example, we reported in August 1999 that,
after five program restructurings, the Army's
Comanche helicopter program contains significant
risks of cost overruns, schedule delays, and
degraded performance.  These risks exist because,
contrary to the practices of successful commercial
companies, program plans call for proceeding with
product development before key equipment
technologies have matured.  In addition, the Army
plans to begin production of the Comanche before
even starting critical tests needed to determine
whether these technologies are mature and will
work as designed.

These are not new issues.  Similar approaches were
used on such troubled programs as the B-2 bomber,
the C-17 airlifter, and many others, with similar
results.  Nor are these results limited to highly
sophisticated weapons systems.  We recently
reported that the Army has purchased more than
6,000 chassis and cargo trailers (shown in figure
5) that, without modifications, cannot be used as
planned because they pose a safety risk and could
damage the vehicles towing them.

Figure 5:  Cargo Trailer

We have compared the product development practices
of leading commercial firms with those used to
acquire defense systems.  The key differences
include the nature of the business case required
to support the start of a program, the extent of
product knowledge at critical decision points, and
the underlying incentives.  In general, aspiring
defense programs rely on unproven technological
advances to successfully compete for limited
defense funds.  Commercial companies, on the other
hand, demand much more knowledge about key
technologies before proceeding with the
development of new products.

A number of actions are underway to improve DOD's
weapons acquisition outcomes, and DOD's leadership
is genuinely committed to change.  Lasting
improvements in the outcomes of acquisition
programs will not be realized, however, until the
incentives that drive behaviors are changed.
Specifically, existing incentives to start, fund,
and continue weapons acquisition programs must be
realigned with desired outcomes.  DOD's
traditional practice of approving requested
programs, and then reducing procurement quantities
in the face of budget pressures, just increases
unit costs and exacerbates the problem of aging,
high-maintenance equipment.  Changing the
incentives-that is, redefining program
success-will take the efforts of Congress as well
as of DOD and the military services.

Information Technology
The federal government is increasingly dependent
on information technology to improve performance
and meet mission goals.  Agencies depend heavily
on computer systems and networks to implement a
vast array of programs supporting, among other
things, national defense, revenue collections, and
social benefits.  Consequently, successfully
acquiring and applying modern technology is
central to improving government operations and
generating better service to the American people.
We have documented over many years, however, that

ï¿½    billions of dollars have been wasted on
information technology that failed to deliver
expected results,
ï¿½    poorly defined management processes have
fostered suboptimal solutions to agency business
needs, and
ï¿½    unresolved security issues have threatened
the integrity of agency operations.

These problems have involved such important
functions as air traffic control, tax collection,
Medicare transactions, weather forecasting, and
national defense.  For example, because the Health
Care Financing Administration had not adequately
reviewed, revised, and improved mission-related
and administrative processes before making a
significant information technology investment, the
agency was forced to terminate an important
project after cost estimates had soared from $151
million to about $1 billion.  At DOD, we found a
breakdown in the oversight mechanism for ensuring
sound management and development practices for
changing hundreds of inefficient information
systems.  One result of the lack of strong
oversight was that a supply management project was
abandoned after more than $700 million had been
spent.

Several recent reforms-including the Clinger-Cohen
Act of 1996, revisions to the Paperwork Reduction
Act, the Government Performance and Results Act,
the Chief Financial Officers Act, and the Federal
Acquisition Streamlining Act-have helped to
instill a much-needed results-oriented approach
toward IT acquisitions and in-house development
efforts.  For instance, a key goal of the Clinger-
Cohen Act, which is based on best private-sector
practices, is that agencies should have processes
in place to ensure that IT projects are
implemented at acceptable costs and within
reasonable time frames, and are contributing to
tangible, observable improvements in mission
performance.

Some agencies, such as the Internal Revenue
Service, have begun to make significant progress
in establishing a management framework for making
information technology investment decisions.  The
Federal Aviation Administration has established a
structured approach for selecting and controlling
its investments, but the approach does not cover
all its projects and the agency lacks complete and
reliable project information.  Other agencies have
yet to make significant inroads into implementing
the processes and controls needed to manage these
acquisitions effectively.

Acquisition Workforce
Another challenging issue is the capacity of the
acquisition workforce to perform effectively in
today's dynamic environment.  Successfully
implementing acquisition reform and achieving good
contract management require that agencies have the
right people with the right skills.  But
throughout the federal government there is a
looming human capital crisis.  In more than 10
years of downsizing, there has been relatively
little hiring at the entry level compared with
earlier years.  As a result, the percentage of the
workforce aged 30 and under-the pipeline of future
agency talent and leadership-has dropped
dramatically, while the percentage of the
workforce aged 50 and above grows ever larger.
Within the next several years, we can expect to
see a huge knowledge drain as many of our more
experienced and valued people leave the federal
workforce.  Unfortunately, the government's
hiring, training, and retention practices have not
been oriented toward maintaining a balanced,
stable workforce and ensuring adequate emphasis on
career development, training, and orderly
succession planning.

Dealing with this issue throughout the government,
including in the acquisition area, will not be
easy.  Agencies are facing ever-growing public
demands for better and more economical delivery of
products and services.  At the same time, the
ongoing technological revolution requires not just
new hardware and software, but a workforce with
new knowledge, skills, and abilities.  And, at the
moment, agencies must address these challenges in
an economy that makes it difficult to compete for
people with the competencies needed to achieve and
maintain high performance.

Having a high-quality acquisition workforce-the
right people, with the right skills, and the right
incentives-will become even more critical in an
era of increased outsourcing.  Federal agencies
have been encouraged to conduct public-private
competitions to determine the best source to
perform commercial type activities, and perhaps
realize significant savings.  DOD, for example,
currently has plans to complete competitive
sourcing studies involving over 200,000 positions
by 2005, with the expectation of saving about $11
billion.  However, DOD faces significant
challenges in launching and completing this
magnitude of studies in this timeframe.  Depending
on the outcomes of these competitions, DOD also
could face challenges in overseeing an increased
number of contracts.

Few competitive sourcing studies have been planned
by other federal agencies.  That has the potential
to change, however, as federal agencies implement
the FAIR Act, which requires federal agencies to
identify and publish lists of their commercial
activities annually.  Our preliminary review of
some of the lists has raised questions about how
agencies decided which activities to list, and
about the usefulness of the lists.  While it is
difficult to forecast the extent to which listed
activities will be the subject of competitive
sourcing studies, it is almost certain that any
increase in outsourcing will only add to the
already challenging contract management workload.
Agencies will need to ensure that the acquisition
workforce is up to the task.

Past reforms have targeted problems with the
acquisition workforce.  For example, legislation
in 1990 and 1996 established education, training,
and experience requirements for entry and
advancement in the acquisition career field.  Our
February 2000 report to this Subcommittee on the
implementation of the most recent of these
initiatives found that neither of the agencies we
reviewed-GSA and the Department of Veterans
Affairs-had complete information on the extent to
which their acquisition workforces had received
required training.  In addition, the Office of
Federal Procurement Policy had not yet ensured
that civilian agencies were collecting and
maintaining standardized workforce information, as
required by the Clinger-Cohen Act.

Leading private and public organizations realize
that their people largely determine their capacity
to be successful.  They also realize that people
are assets whose value can be enhanced through
investments such as training.  They take a
strategic approach to training their people on new
practices, and provide customized training
targeted to specific needs.  Federal agencies need
to take a similar approach for acquisition reform
to succeed in producing better outcomes.

Conclusion
Far too often, the products and services the
government buys cost more than projected, are
untimely, or fail to meet expectations.  In some
cases, agencies wasted billions of dollars on
acquisitions that did not improve service to the
American public and did not contribute to
accomplishing agency missions.

Numerous attempts have been made over the years to
improve federal acquisition outcomes, and some
progress has been made.  Lasting improvements in
federal procurement operations offer the potential
to save billions of dollars, dramatically improve
services to the American public, and strengthen
confidence in the accountability and performance
of our national government.  However, much more
needs to be done to achieve real and sustained
improvements.  It will take time to improve agency
procurement operations because the problems we
have identified are difficult ones and are deep-
rooted in very large programs and organizations.
There is much to be learned from the best
practices of leading, high-performing private
sector organizations.  When use of commercial best
practices is determined to be appropriate,
government agencies should adopt such practices
unless there is a compelling reason not to.  To
ensure that progress continues, sustained
management attention and congressional
oversight-particularly involving weapons systems,
information technology, and human capital
issues-will be necessary.

Mr. Chairman, this concludes my prepared
statement.  I will be happy to respond to any
questions you or other Members of the Subcommittee
may have.

Contact and Acknowledgement
For further contacts regarding this testimony,
please contact Henry L. Hinton, Jr., at (202) 512-
4300.  Individuals making key contributions to
this testimony included Johana R. Ayers, Jack L.
Brock, Jr., David E. Cooper, Ralph C. Dawn, Jr.,
Louis J. Rodrigues, David E. Sausville, Gerald
Stankosky, Bernard L. Ungar, Adam Vodraska, and
William T. Woods.

_______________________________
1 GSA negotiates contracts with vendors for a wide
variety of mostly commercial-type products and
services.  These contracts permit other agencies
to place orders directly with the vendors.

Attachment I
Timeline of Selected Acquisition Reform
Initiatives
Page 19                            GAO/T-OCG-00-7
Figure I.1: Timeline of Selected Acquisition
Reform Initiatives

Source:  GAO Analysis of Selected Acquisition
Reform Initiatives.

Attachment II
Related GAO Products
Page 21                            GAO/T-OCG-00-7
Human Capital: Strategic Approach Should Guide DOD
Civilian Workforce Management (GAO/T-GGD/NSIAD-00-
120, Mar. 9, 2000).

Acquisition Reform: GSA and VA Efforts to Improve
Training of Their Acquisition Workforces (GAO/GGD-
00-66, Feb. 18, 2000).

Congressional Oversight: Opportunities to Address
Risks, Reduce Costs, and Improve Performance
(GAO/T-AIMD-00-96, Feb. 17, 2000).

Budget Issues: Effective Oversight and Budget
Discipline Are Essential-Even in a Time of Surplus
(GAO/T-AIMD-00-73, Feb. 1, 2000).

Competitive Contracting: Preliminary Issues
Regarding FAIR Act Implementation (GAO/T-GGD-00-
34, Oct. 28, 1999).

Defense Acquisitions: Army Purchased Truck
Trailers That Cannot Be Used as Planned (GAO/NSIAD-
00-15, Oct. 27, 1999).

Defense Acquisitions: Comanche Program Cost,
Schedule, and Performance Status (GAO/NSIAD-99-
146, Aug. 24, 1999).

Best Practices:  DOD Training Can Do More to Help
Weapon System Programs Implement Best Practices
(GAO/NSIAD-99-206, Aug. 16, 1999).

Best Practices: Better Management of Technology
Development Can Improve Weapon System Outcomes
(GAO/NSIAD-99-162, July 30, 1999).

DOD Competitive Sourcing: Lessions Learned System
Could Enhance A-76 Study Process (GAO/NSIAD-99-
152, July 21, 1999).

IRS Management: Formidable Challenges Confront IRS
as It Attempts to Modernize (GAO/T-GGD/AIMD-99-
255, July 22, 1999).

Procurement Reform:  How Selected Countries
Perform Certain GSA Activities (GAO/GGD-99-109,
July 15, 1999).

Contract Management:  DOD Pricing of Commercial
Items Needs Continued Emphasis (GAO/NSIAD-99-90,
June 24, 1999).

Customs Service Modernization: Actions Initiated
to Correct ACE Management and Technical Weaknesses
(GAO/T-AIMD-99-186, May 13, 1999).

National Laboratories: DOE Needs to Assess the
Impact of Using Performance-Based Contracts
(GAO/RCED-99-141, May 7, 1999).

Air Traffic Control: FAA's Modernization
Investment Management Approach Could Be
Strengthened (GAO/RCED/AIMD-99-88, Apr. 30, 1999).

Defense Acquisition: Best Commercial Practices Can
Improve Program Outcomes (GAO/T-NSIAD-99-116, Mar.
17, 1999).

F-22 Aircraft: Issues in Achieving Engineering and
Manufacturing Development Goals (GAO/NSIAD-99-55,
Mar. 15, 1999).

Customs Service Modernization: Serious Management
and Technical Weaknesses Must Be Corrected
(GAO/AIMD-99-41, Feb. 26, 1999).

High-Risk Series: An Update (GAO/HR-99-1, January
1999).

Major Management Challenges and Program Risks: A
Governmentwide Perspective (GAO/OCG-99-1, January
1999).

Major Management Challenges and Program Risks:
Department of Defense (GAO/OCG-99-4, January
1999).

Major Management Challenges and Program Risks:
Department of Energy (GAO/OCG-99-6, January 1999).

Major Management Challenges and Program Risks:
National Aeronautics and Space Administration
(GAO/OCG-99-18, January 1999).

OMB Circular A-76: Oversight and Implementation
Issues (GAO/T-GGD-98-146, June 4, 1998).

Customs Service Modernization: Architecture Must
Be Complete and Enforced to Effectively Build and
Maintain Systems (GAO/AIMD-98-70, May 5, 1998).

Defense Acquisition: Improved Program Outcomes Are
Possible (GAO/T-NSIAD-98-123, Mar. 18, 1998).

Acquisition Reform: Implementation of Key Aspects
of the Federal Acquisition Streamlining Act of
1994 (GAO/NSIAD-98-81, Mar. 9, 1998).

National Weather Service: Budget Events and
Continuing Risks of Systems Modernization (GAO/T-
AIMD-98-97, Mar. 4, 1998).

Best Practices: Successful Application to Weapon
Acquisitions Requires Changes in DOD's Environment
(GAO/NSIAD-98-56, Feb. 24, 1998).

Defense IRM: Poor Implementation of Management
Controls Has Put Migration Strategy at Risk
(GAO/AIMD-98-5, Oct. 20, 1997).

Defense Acquisition Organizations: Linking
Workforce Reductions With Better Program Outcomes
(GAO/T-NSIAD-97-140, Apr. 8, 1997).

High-Risk Series: Information Management and
Technology (GAO/HR-97-9, February 1997).

Acquisition Reform: Purchase Card Use Cuts
Procurement Costs, Improves Efficiency (GAO/NSIAD-
96-138, Aug. 6, 1996).

Best Practices Methodology: A New Approach for
Improving Government Operations (GAO/NSIAD-95-154,
May 1995).

High Risk Series: An Overview (GAO/HR-95-1,
February 1995).

Weapons Acquisition: A Rare Opportunity for
Lasting Change (GAO/NSIAD-93-15, Dec. 1992).

*** End of Document ***