Emerging Trends in Procurement:
Crisis or Opportunity?
And the NCMA Response
Andrew C. Obermeyer, CPCM, Fellow
Member, Board of Directors
National Contract Management Association
The Acquisition Workforce Has Changed
• Years of downsizing (1990’s)
• Human capital strategies have not kept up with
evolving demand
• Different set of expectations, e.g. business
advisor
• Evolving gap in replacing the retiring
professionals
• Inadequate investment in training
Acquisition Workforce Demographics - Age
55+
30%
45-54
39%
<35
9%
35-44
18%
Acquisition Workforce Demographics - Education
Masters
44%
Doctorate
6%
other
13%
Bachelors
36%
College Graduates - 2005
3,500,000
3.2M
3.1M
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
600k
500,000
0
300k
It will take about a
generation to reverse
Graduates
the ratio of highly
College
skilled workers
Engineering between the U.S. and
2.0M
India and China.
When the generation of
engineers and
scientists that sent the
man to the moon
retires, who is going to
replace them?”
<100k
China
India
United States
Academic Disciplines & Employment Trends’
Applied Information Management Institute,
Jan 2006
TargetedTalent
The Emerging
Competition
For
"One
in every three
of Lockheed's
College Hires Targeted
Experienced Hires
employees is over 50. To sustain our
talent
base, we're hiring 14,000 people a year. In
two years, we're going to need 29,000 new
hires; in three years, 44,000. If this trend
continues, over the next decade we will
need 142,000."
- ROBERT J. STEVENS, chairman,
President and CEO of Lockheed Martin.
Wall Street Journal, April 19, 2006
Raytheon Company Employee Population Profile
Number of Exempt Employees
5,000
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
<1
1-5
6-10
11-15
16-20
21-25
26-30
31-35
36-40
41-45
45+
Years of Service
Age:
Under 25
Strategic Target Areas
26-35
36-45 46-55 56-65
66-75 76-85
The Nature of What Government Buys Has
Changed
• Offloading simple transactions
• Larger, more encompassing services
• Complex IT, communications, and weapons
systems
• Accelerated fielding to serve the war fighter
• Emphasis on logistical support
AALPS
ACTF
ADLER
AVCATT
ACS
AFATDS
APKWS
A2C2S
ATACMS
BSM
ADOCS
APACHE
AMDWS
ASAS
BCS3
BSTF
AWACS
LOGISTICS
AIR DEFENSE
AAFARS
AMPS/JMPS
CAMEL
C2
TRAINING
CHIMS
DCGS-A
BATES
C-5
BFT
Blackhawk
Future Combat
System (FCS)
C-17
C-130
CBS
CBRNRS
C2PC
F/A- 22
FIOP
GIG
FMTV
CHINOOK
DMS-A
IBS
ACTF MANEUVERMOB/SUR
FIREFINDER
NETWORK
SOLDIER
MGV AALPS
ATACMS
(Q36)
ADOCS
IEWTPT
Logistics
ADSI
AVCATT
DTSS
HSTAMIDS
APACHE
ACSWMEADS
C2
STEPS
LFC2IS
BVTC
AAFARS
CED C-5
ADSSI CBS LLDR APKWS
Engineer
CLOE
MAGIS
MOUT-OIS
MK
VII
SLAMRAMM
FAAD-C31
CAMEL
FCS–Non
FCS CID
AMPS/JMPS
C-17
IEWTPT
FRS
Vehicle
DCTS
AFATDS
JCM
RADIAC
SET
MCTIS
HTI-FLIR
SHORAD
FMTVC-130
GPS
SECOMPI
Sentinel
Soldier to FCS CID
AMDWS
LIGHTWEIGHT120MM
FBCB2
JTRS1
HEMTT
JLENS XXI
MILES
HEMTT
Soldier
to Soldier CID
MANEUVER
cannon (Pending)
MOUT-OIS
A2C2S SOLDIER-CATT
JTRS5
HMMWV
PEGASYS
LLAPI
LOGISTICS
MFCS
FIREFINDER (Q37)
TACSIM
JWARN
ASAS
HMMWV
M1114
HMMWV
M1114
MK-44SE-CORE
LAND
MOB/SURV
BSTFWARRIOR
LFED
LETHALITY SOLDIER
GBS
BCS3 WARSIM
PROPHET
SYSTEM
HIPPO
MC4
CLOEMUNITION
ACSW AIRBURST
BSM
HMMWV
INTEL
JCAD
BFT
NCES
LHS FUEL FARM
ACSW KE MUNITION
JSLSCAD
PLS
BLACKHAWK
ACS
PKI
GCSS-A
LWP
C2PC
ACSW TRAINING MUNITION
JBPDS
MSD
STEPS
CBRNRSHIPPO
CKEM
JTAGS
MAINTENANCE
TRUCK/FRSTELEPORTS
JBSDS
DMS-A
Command
and
Control
Electronic Time Fuse
CHINOOK
UAVPLST
CL IVTES
GCCS-A
DTSS
WIN-T
EXCALIBUR
ASTAMIDS / EO/IR
Engineer
vehicle
FIOP
TEP UAV-CL IV-b
FAAD-C3 MACSFIRE SUPPORT
GMLRS
Tactical SIGINT PAYLOAD
HMEE
FIRE
SUPPORT
TC-AIMS
II
MOFA
UAV
–SAR/GMTI
GIG
FBCB2
LHS
FUEL
FARM
MILES XXI
INTEL
HIMARS
ADLER
NON-LETHAL
155mm
REBS
GCCS-A
FIRE
SUPPORT
LFC2IS
UGV
BATES
PGMM
FIREFINDER-Q37
MTS
AWACS TRAINING
ARV(L)
MONGOOSE
INTEL
HMEE
Training Unique Ammo
FIREFINDER
(Q36)
IDM
ATIA
SIMACET
F/A-22
Land Warrior
JAVELIN
GMLRS
IBS
MK-44
AMMO
30
mm
AIRBURST
CCTT
IMS
MULE DCGS-A
IMETS NFCS
TBMCS
HIMARS
MK-44 AMMO
30 mm KE
CTIA
NFCS
GSTAMIDS
NLOS-LS
MAGIS
IDM
JCM
JC2
CHIMS
MK-44
AMMO
40
mm
AIRBURST
TSV
DLS
PROFILER
TCO
MCTIS
MK-44 AMMO 40 mm KE
TAIS
OneSAF
TELEPORTS
MTS
IMETS
MRM/ERM PHOENIX
JC2
OneTESS PAFCS
NGATS
MLRS
NGATS
LWP
JLENS
MCS
JTAGS
PATRIOT
Internal
PKI
TC-AIMS II
TEP
PLST
SentinelMIP
LLAPI
Interfaces
PEGASYS
Soldier System
MCS
TES
SLAMRAMM
UAV-CL IV -b TAIS
SHORAD
Profiler
REBS
PLS
PAFCS
PHOENIX
Mongoose
MSD
MLRS
MIP
MEADS
SOLDIER-CATT
WARSIM
TSV
TBMCS
TCO
TACSIM
SECOMPI
SE-CORE
SIMACET
ExternalSystems
and Interfaces
The Working Conditions Have Changed
• Compelling urgency – everything is accelerated in
fight against terrorism
• Doing business in the battle space
• Deployment of personnel leaves home force
shorthanded
• Unprecedented level of support needed for
hurricane Katrina response
• Constant threat of oversight and secondguessing decisions
• High media attention
The Acquisition Rules Have Changed
• Years of acquisition reform (1990’s)
• Commercial items and complex services
• Larger task orders with less transparency
• Organization conflicts of interests
• Interagency contracting
• More outsourcing (competitive sourcing)
• Expanded socio-economic programs
• Buy American and Buy America
The Supply Base Has Changed
• Industrial base consolidation
• Partnerships and teaming
• Global competition has increased
• Strategic sourcing
• More eBusiness
• More competition at 2nd and 3rd tier
• Increased OCI challenges
National Imperatives Driving Changes
 Domestic Economics - Debt,
Medicare, Social Security,
Supplementals, Trade Balance
 Threat Changes - Asymmetric warfare
(bio, cyber, IEDs); world-wide
terrorism; weapons proliferation;
rogue nuclear states
 Technological Changes Integrated data; open-sources;
bio, nano, robotics, high-energy
lasers, etc.
 Industrial Changes - Horizontal &
vertical integration; commercial
high-tech advances
 New Missions - Homeland defense;
missile defense; counterinsurgency;
stability and reconstruction
 Globalization - Rapid spread of
Technology; multinational firms;
foreign competition
 Warfighting Changes - Netcentric
Warfare; Systems-of-Systems; Joint
and coalition operations
 Acquisition Workforce - Aging;
wrong skill mix; training needs;
competition for skilled people
 Defense Budget Shifts - From
Equipment to Personnel, O&M and
Homeland Security
 Recent “Scandals” - Druyun,
Cunningham, Abramoff, etc.
This All Adds Up To Risk!
• There is more work, it is more complex, and it
must be acquired faster than ever.
• Workforce downsizing, expert class retiring, while
expectations and oversight increases.
• Rules are more flexible, actions are less
transparent.
1. The Federal acquisition workforce
remains a major challenge.
• Shortage of skilled labor is not unique to our profession,
industries or employers.
• Cannot replace ‘brain drain’ fast enough.
• Workload will remain.
• Training funds get cut routinely.
• Alternative workforce solutions required.
– Eliminate barriers to hiring external candidates.
– Eliminate barriers to re-hiring annuitants.
– Increase use of alternative work arrangements and compensation
plans.
– Increased telework.
2. The political pressures on the Federal
procurement system will increase short
term.
• Mission will not be reduced soon.
– Replacing war equipment and materials.
– Aging systems (refueling tankers, etc.)
– Insatiable appetite for improved warfighting technologies.
• Dozens of contracting oversight bills in committees.
• Increased attention on blended or multi-sector workforce.
• Attention on GSA Administrator, SBA effectiveness, NASA
IG, HUD Administrator, DHS acquisition organization and
DoD systems acquisitions.
3. Financial pressures will force
discretionary budget reductions beginning
in next five years.
• The Fiscal Wake-Up Tour being conducted by the
Comptroller General.
• We spent less of our budget on defense in 2006 than in
1986 or 1966, as a % of GDP
• Discretionary spending is down from 67% in 1966 to 38%
in 2006.
• Budget deficits of $928 billion in last two years.
• Rising entitlement (health care) costs is the main cause.
“Saving Our Future Requires Tough Choices Today”
GAO-07-739CG April 4, 2007
4. Regulatory changes likely:
•
•
•
•
•
•
•
Reduce number of contracts awarded non-competitively.
Eliminate practice of Lead Systems Integrator (LSI).
Increase use of fixed-price contracts.
Increase small business contracting goals.
Restrictions on contracting with entities in tax default.
Guidance on use of award fees.
Emphasis on using hybrid contracts containing multiple
incentive types.
• Restrictions on outsourcing, new requirements to insource.
• Increase acquisition workforce development programs.
NCMA Strategic Objectives 2007-2008
• Develop the Next Generation of Contract Management
Professionals
• Increase Professional Advocacy
• Reach More People in the Federal Contracting
Community
• Develop professional standards
Develop the Next Generation of Contract
Management Professionals
1. Introduce undergraduate students to the CM profession and
involve them in NCMA by offering student memberships, student
chapters, and student programs.
2. Increase the preparedness for candidates entering the CM
workforce by increasing undergraduate programs containing CM
and related curriculum, and by publishing a standard CM
curricula and promoting the program to universities.
3. Accelerate the development of new professionals through a
leadership development program.
4. Increase research and writing opportunities for new professionals
and students through the Macfarlan program.
Increase Professional Advocacy
1. Improve perception of the contract management profession in
industry, the government (including Congress), the press, and
the general public, through an active public relations program.
2. Increase recognition of NCMA in industry, the government
(including Congress), the press, and the profession, through an
active public relations program.
3. Increase membership participation in advocacy activities through
bilateral electronic communications and events.
Reach More People in the Federal Contracting
Community
1. Expand the number of programs to serve the federal community,
including education, certification, conference, publication, and
other types of programs.
2. Increase communication and involvement of the senior executive
cadre within the profession.
3. Utilize education partners, advertisers and corporate sponsors to
reach new people in the federal community.
Develop Professional Standards
1. Baseline existing professional standards for government and
industry organizations; benchmark standards and processes of
other professions.
2. Reach consensus among stakeholders (chapters, BOA, BOD,
academia) on Generally Accepted Contract Management
Practices (GACMP).
3. Align professional standards and certification processes.
Communities of Practice
New
Program!
• More ways to connect to the information, people,
and tools that you need.
• Launch April 2008:
– Task order and Schedule Contracting
– Small Business Contracting
– Performance Based Acquisition
• Online features: e-courses, discussion forums,
listservs, blogs, expert networks, e-newsletters,
website, research archives
• Meetings at World Congress, new educational
conferences, quarterly magazines
What you can do.
• Lead by your actions.
• Be a “chief courage officer”
• Stay informed on the issues.
• Have opinions, and engage in the discussion.
• Participate in continuous learning.
• Demonstrate your competency by getting
certified.
• Resist cynicism and skepticism.
• Participate in your NCMA chapter.
Engage in your profession!
NCMA
21740 Beaumeade Circle, Suite 125
Ashburn, VA 20147
Neal J. Couture, CPCM
Executive Director
couture@ncmahq.org
1-800-344-8096 x423
571-382-1123
703-448-0939 (fax)
www.ncmahq.org