DOD Competitive Sourcing

In late 1995, after a lull of several years, the Defense Department (DOD) began urging the military services and defense agencies to intensify competitive sourcing efforts as provided for in the Office of Management and Budget's Circular A-76. Under Circular A-76, the military is to conduct cost comparison studies of commercial activities being done by government workers to determine whether it would be more cost-effective to maintain them in-house or contract with the private sector. Government officials, Congress, and business leaders have complained that these cost comparisons take too long. Congress has encouraged DOD to develop standardized performance work statements to expedite these competitive sourcing studies. This report discusses DOD's efforts to (1) improve performance work statements, including encouraging the use of standard templates, and (2) implement other efforts to improve the competitive sourcing process, as well as gather and disseminate lessons learned that could benefit the competitive sourcing program through DOD.

GAO noted that: (1) DOD has focused on improving the quality of its performance work statements, with limited emphasis on developing standardized work statements; (2) according to various DOD officials, the need to tailor performance work statements to individual circumstances and locations, as well as the increasing emphasis on grouping multiple activities for competitions under single solicitations, limits the usefulness of standardized work statements; (3) many officials stated that while previously developed work statements provide useful guidance, they are best used as a frame of reference for, but not in place of, developing new performance work statements; (4) in addition to efforts devoted to developing improved performance work statements, DOD components and activities are pursuing a variety of approaches on their own to improve competitive sourcing studies; (5) some of these may not shorten the study process, but they are intended to improve the efficiency and long-term cost-effectiveness of the process; (6) approaches range from combining multiple functions together under single solicitations to using new tools to improve the development of key A-76 documents; and (7) however, DOD and its components have devoted limited efforts and resources to documenting and disseminating lessons learned and best practices from the various efforts that could be useful DOD-wide.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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