Michael Fischetti is the Executive Director of the National Contract Management Association.
The more complex a system becomes, the more those at high levels wish to control it. Thus, increased complexity in acquisition law and regulations has over time increased oversight while decreasing responsiveness. Simple innovations such as the introduction of FAR Part 12, commercial contracting, have become laden with noncommercial, uniquely government requirements. This top-down evolution of today’s contracting system created today’s complexity.
Management theory supposes a defining characteristic of complex systems is the inability to predict the outcome of any given change to it. Minor events can have enormous chain reaction consequences, while major changes conversely may have an insignificant effect. Thus, strong control of any complex system may be impossible, with no one in absolute control, while poor outcomes incentivize greater leadership control.
Author Thomas Hout counters that “no intelligence from on high can match the quality of solutions to market problems that arise from players who are constantly communicating with one another on the ground level…. Managers interfere at their peril.”
Government contracting—like the tax code, health care, or today’s financial system—is an example of complexity and thus huge challenges to improvement. The volume, structure, and sometimes contradictory motivations ingrained in contracting today took many years to evolve. While the FAR remains very adaptable and responsive for those who understand it, the complexity of today’s government requirements, organizations, governing statutes and regulations, and complex budget, financial and program processes compound blazing any improvement path.
Expedient and simple improvements narrowly focused on layering new regulations or training requirements for staffing quality and quantity won’t work by themselves. For example, no one anticipated the huge growth in task order contracting that evolved from the past significant acquisition reform. Nothing less than a holistic approach that puts everything on the table will work.
Meanwhile, contracting managers must work in the here and now, obligated to exert whatever technical, program, and leadership prowess they have navigating today’s complex environment and the criticisms that come from every corner. For those in government, they’re the sanity check, validating if the requirement is doable or makes sense to industry; whether the source can be selected under a pure best value or lowest price technically acceptable solution, or if competition is best limited to a small business set-aside or full and open competition. Should the government buy the Chevy or the BMW? Is gold-plating involved? Are foreign components involved? Is the firm “responsive?” Will the contract be compliant with and agreeable to all regulations; internal policy; agency leadership; local Congressional delegation or Committee concerns; recent GAO, inspector general, or procurement management reviews; relevant authorization and appropriations language; management emphasis; etc.? They work against a variety of forces often pushing in opposing directions. They rely on terms like “fair and reasonable,” and must promote sound ethical principles to guide them in maintaining an objective stance of what is in overall best interest of the program, agency and taxpayer. While most can afford to be subjective, outspoken and critical, contracting managers cannot. Regardless of program outcome, not everyone is happy every time.
Hout asserts that managers need to manage the way that accident and law interact, knowing how and where to push to keep the system from neither descending into chaos nor becoming rigidly ordered. That’s a tall order. We must develop the best contracting managers possible and consider simplification as a goal. We should be cautious of sidelines contracting quarterbacks with views on what plays to call but don’t have to run them themselves. Before we make changes, I hope we ask contracting managers what they think. OMB has embarked on acquisition initiatives in recognition of today’s complexity. Hats off to today’s contracting managers—delivering effective outcomes within today’s complexity.
Contracting’s complexity and the impact on its managers
