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5. The ongoing ability to develop, maintain, and improve the surveillance of contracted activity
to ensure that value is being obtained, and to take corrective action where required (OMB,
2003; GAO, 2005b).
All of the above require an appropriate number of skilled personnel in a wide variety of
fields. Expertise is needed in both contracting per se and in the technical or functional area that
is being outsourced. Where outsourcing is viewed as a way to reduce government headcount
(particularly that of civilian personnel), those remaining in the job need to have higher level of
expertise to carry out adequate surveillance of contracted activity. The GAO has emphasized
the importance of improvements in monitoring (or “surveillance”) of DoD service contracts:
According to DoD officials, insufficient surveillance occurred because surveillance is not
as important to contracting officials as awarding contracts and therefore, does not
receive the priority needed to ensure that surveillance occurs. […] Further, surveillance
was usually a part-time responsibility and some personnel felt that they did not have
enough time in a normal workday to perform their surveillance duties. (GAO, 2005b)
Addressing human capital issues in acquisition is not just a matter of the size of the
workforce. It is also a capacity issue. While acquisition reforms have helped streamline
smaller acquisitions, larger acquisitions, particularly for information technology, remain
complex and technical. Yet agencies are at risk of not having enough of the right people
with the right skills to manage these procurements. Consequently, a critical issue the
federal government faces is whether it has today, or will have tomorrow, the ability to
manage the procurement of increasingly sophisticated services. (GAO, 2001b)
That such phenomena should occur is perhaps a natural outcome of the contradictory
forces at work in outsourcing activities. While the emphasis is on reducing in-house personnel,
outsourcing in itself may require a targeted increase in the number of government employees,
as well as some change in their qualifications, to ensure that outsourcing is carried out
according to regulations in a cost-effective, “best value” manner.
The Air Force represents an example of an effective approach to the need for up-front
planning of the in-house personnel requirements associated with outsourcing, as well as the
inherently interdisciplinary mix of government personnel need for adequate contract surveillance
(AFI 63-124, 2005). However, the Air Force experience illustrates the difficulties of considering
potential or actual contract management costs as part of the outsourcing decision.
A RAND study of 22 PBSA-inspired contracts at 15 Air Force bases concluded that
information on the internal costs of outsourcing was “highly impressionistic” and that data on
quality assurance costs, which should theoretically decline with a switch to PBSA, were
ambiguous (Ausink, Camm, & Cannon, 2001). Even the actual expenditures on contracts were
difficult to calculate and evaluate within the agency:
DoD is in the early stages of a spend analysis pilot. Although DoD is moving in the right
direction, it has not yet adopted best practices to the same extent as the companies we
studied. Whether DoD can adopt these practices depends on its ability to make longterm
changes necessary to implement a more strategic approach to contracting. DoD
also cites a number of challenges, such as its large and complex need for a range of
services, the fragmentation of spending data across multiple information systems, and
contracting goals for small businesses that may constrain its ability to consolidate
smaller requirements into larger contracts. Challenges such as these are difficult and
deep-rooted, but companies also faced them. For DoD to change management practices
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