Anne Rung, Administrator, Office of Federal Procurement Policy, Office of Management and Budget
Frank Kendall, US Undersecretary of Defense for Acquisition, Technology and Logistics, Department of Defense
The Federal Government spends over $500 billion annually to acquire goods and services to conduct agencies’ business. Agencies have traditionally acquired and managed these common commodities in a decentralized manner and failed to achieve economies of scale or to implement effective spend management practices internally or across the government. As a result, many agencies often pay higher prices to acquire and use these commodities than necessary. The Administration has already initiated acquisition and management savings efforts aimed at reducing the government’s costs to acquire and use these commodities by calling on the largest buying agencies to form the Strategic Sourcing Leadership Council (SSLC) to help shape policies and processes to reduce the number of duplicative contracts, improve the Government’s commodity management practices, and direct more procurement spending to Federal Strategic Sourcing Initiative (FSSI) solutions.
The Administration’s efforts to improve the government’s buying power through the use of strategic sourcing have saved over $300 million since 2010 on commonly purchased goods such as office supplies and services such as package delivery. Creation of central vehicles that can be used by all Federal agencies has reduced contract duplication (by an estimated 40% in office supplies) and reduced prices for some common office supplies by over 65%. Such efforts save tax dollars directly through price reductions and also through the reduced duplication that allows agencies to focus scarce human capital resources on more complex, mission critical efforts.
This cross-agency goal builds on the success of FSSI and increases the use of strategic sourcing across Government. Starting in 2014, next-generation solutions for existing FSSI solutions will be rolled out and the SSLC will look to expand strategic sourcing to other commodity areas such as janitorial and sanitation supplies, information technology, hardware, and desktop publishing among other categories.