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Strategic Sourcing in the Public Sector Abstract Presenter: Walter N. Quade, Commonwealth of Pennsylvania The purpose of this paper is to present a new approach to Public Sector Procurement Policies. In the past, the majority of Public Sector Procurement focused on the process issues surrounding the procurement rather than the objectives of Supply Chain Management as found in the private sector. Pennsylvania, as a leader in implementing new approaches to Government, has lead the way in adapting those policies that have been proven effective in managing cost and the supply chain in the world business environment of the 21st Century. Government entities have lagged the private sector models of adding value to the Supply Chain of their organizations. Often we hear of the overpriced goods and services that drive the cost of Government in an unprecedented upward spiral. With the recent slowing of economic growth and the accompanying tax base, and a higher demand for Government Services we find ourselves in new territory as a nation. Somehow we need to reevaluate how Government Business is conducted and the Value Added principal to effectively “Do more with less.” People continue to question how to incorporate private sector practices into the public domain. Strategic Sourcing, as practiced in Pennsylvania, is the starting point for improving operational effectiveness of all levels of Government. The presentation will focus on the planning and implementation of Strategic Sourcing in Pennsylvania and discuss the opportunities and challenges of implementing it in any Government Sector. The focus will be on developing tangible objectives for the Procurement Divisions and moving out of the “Way things have always been done” to one of “innovation and experimentation.” The final part of the presentation will define how to implement these practices in Government and discuss the necessary structure to support it. Author Info & Affiliation: Mr. Walter N. Quade 4 Oak Gardens Coal Township Pa., 17866 Tel:570-644-1143 Work:717-787-4775 E-Mail:WNQU@ptd.net M.B.A. 1988 Blooomsburg University of Pa. B.S. 1974 Bloomsburg University of Pa. Certified Purchasing Manager 1988 I.S.M. (Formerly N.A.P.M.) = ==================^Åèìáëáíáçå=oÉëÉ~êÅÜW=òb^qfkd=pvkbodv=clo=fkclojba=è^kdb====- 47 - = =
Panel – Implementing RFID in the Defense Supply Chain Wednesday, May 17, 2006 1:30 p.m. – 3:00 p.m. Chair: Implementing RFID in the Defense Supply Chain Alan Estevez – Assistant Deputy Under Secretary of Defense (Supply Chain Integration) Discussant: Tali Freed – California Polytechnic State University Papers: What Is the Right RFID for Your Process? Geraldo Ferrer, Naval Postgraduate School Uday Apte, Naval Postgraduate School Nicholas Dew, Naval Postgraduate School Investigating the Department of Defense’s Implementation of Passive Radio Frequency Identification (RFID) LT Christopher A. Thomas, USN, COMNAVSURFOR Capt Emeterio V. Hernandez, USAF, AFLMA/LGLR Chair: Alan Estevez, Assistant Deputy Under Secretary of Defense (Supply Chain Integration) Mr. Estevez is the Assistant Deputy Under Secretary of Defense (Supply Chain Integration) within the Office of the Deputy Under Secretary of Defense (Logistics and Materiel Readiness). He is responsible for development of global supply-chain management and distribution policies and processes to support the warfighters’ operational requirements in the 21st Century. He assumed his current position and was inducted into the Senior Executive Service in October 2002. Prior to assuming his current position, Mr. Estevez was the Deputy to the Assistant Deputy Under Secretary of Defense (Transportation Policy) from May 2000 to September 2002. In that capacity, he was responsible for development of policies in support of DoD strategic mobility, transportation, and traffic management programs. From September 2001 to December 2001, Mr. Estevez was the Acting Assistant Deputy Under Secretary of Defense (Transportation Policy). = ==================^Åèìáëáíáçå=oÉëÉ~êÅÜW=òb^qfkd=pvkbodv=clo=fkclojba=è^kdb====- 48 - = =
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Author(s) Title Publisher Issue Dat
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The research presented at the sympo
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Preface and Acknowledgements Those
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The NPS A Team Rear Admiral James B
Page 9 and 10: 4 th Annual Acquisition Research Sy
Page 11 and 12: PANEL -- IMPLEMENTING AN OPEN SYSTE
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Page 15 and 16: Plenary Panel - Acquisition Reform
Page 17 and 18: In May 1996, Rear Adm. Hamilton bec
Page 19 and 20: Panel - Enhancing Collaborative Cap
Page 21 and 22: Collaborative IT Tools Leveraging C
Page 23 and 24: Group’s Perceived Usefulness Grou
Page 25 and 26: diagnose collaborative capacity enc
Page 27 and 28: Organization A Problem Interagency
Page 29 and 30: Incentives - Collaboration as a pre
Page 31 and 32: Two other frequently cited barriers
Page 33 and 34: Panel - Analytic Approaches to Shap
Page 35 and 36: Discussant: Michael McGrath - Deput
Page 37 and 38: Panel - Strategic Sourcing Wednesda
Page 39 and 40: Abstract In this paper, we examine
Page 41 and 42: support from the taxpayer. A key co
Page 43 and 44: etc. (Figure 1) (Kraljik, 1983). Vi
Page 45 and 46: that companies adopted a strategic
Page 47 and 48: Benchmarking Industry According to
Page 49 and 50: 80% 70% 60% 50% 40% 30% 20% 10% 0%
Page 51 and 52: initiatives. In efforts to reduce s
Page 53 and 54: eduction goals. Also, in the same m
Page 55 and 56: Conclusion The DoD is struggling to
Page 57 and 58: Gabbard, E. G. (2004, April). Strat
Page 59: Staff. (2005, December 8). Hacket r
Page 63 and 64: What Is the Right RFID for Your Pro
Page 65 and 66: Introduction The evolution and appl
Page 67 and 68: Literature Review RFID technology w
Page 69 and 70: The reader is a device used to coll
Page 71 and 72: Active tags sometimes have sensors
Page 73 and 74: An RFID network with open architect
Page 75 and 76: Passive tag application: Railcar ta
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Page 85 and 86: RFID technology has even enhanced s
Page 87 and 88: The Costs of RFID operation An RFID
Page 89 and 90: • Abandonment: The ability to aba
Page 91 and 92: Fleisch, E., & Tellkamp, C. (2005).
Page 93 and 94: Williams, D. (2005, August 4). Pres
Page 95 and 96: logistics systems from the military
Page 97 and 98: Panel - Transforming the DoD Acquis
Page 99 and 100: upon the best knowledge and practic
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Page 103 and 104: access to, and conducted his analys
Page 105 and 106: organizational problems surface thr
Page 107 and 108: Change in analytic framework. Burea
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interpretation or narrative. What
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common construction. Rather, sense-
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There will be a temptation for acto
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modeling suite. The key comparison
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This model provides us also with th
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here, particularly if the organizat
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organization identified through pri
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Levitt, R.E., Thomsen, J., Christia
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BACKGROUND To an extent, we are add
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Concept Refinement Concept Decision
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some subset of commercial “best p
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transforms the value of a public-se
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We also assume that since the gover
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Of course, we know in reality that
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CONCLUSIONS The acquisition of publ
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Panel - Issues in Acquisition and P
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To What Extent are DoD Activities C
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NAVSUP Data Call (2003 and 2004) FI
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exemption from a particular regulat
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time in the procurement schedule, a
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should be fully supported by applic
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example, federal government, state
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ADR Techniques Traditional litigati
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out the top three with 25.7% of res
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It is a consensus building, public
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Investigative Question 1—Conclusi
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Question 3b: Did the ADR process us
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suited than another to resolution.
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Investigative Question 7: Barriers
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customer, and each of these service
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Panel -- Implementing an Open Syste
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Open Systems and Modular Open Syste
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procurement planning phase include
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procurement documents and specific
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system technical architecture requi
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These evaluation factors are tradit
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In the Cost Reimbursement contract
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technical, schedule, and past perfo
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Developing Performance Based Requir
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The DoD Performance Specification d
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due to many of the reasons presente
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even if there were ten other upgrad
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software developers can employ when
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Conducting this analysis will be as
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integration of “best of breed”
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Reform of Budgeting for Acquisition
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350000 300000 250000 200000 150000
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In fact, the disagreement between t
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Functional Area Analysis D O T M L
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Though many in Washington blame the
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In response to an open-ended questi
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CAPITAL BUDGETING IN THE DoD AND TH
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investment. Full funding also helps
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c. Functional Requirements If it is
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4. Budgeting Phase of Capital Progr
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private firm, one can combine the t
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4. Acceptance of a project using th
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Another disadvantage of the payback
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Another guideline is that firms mus
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This concept has remained consisten
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purchases. Also, the Office of Mana
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CONCLUSIONS The current practices o
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REFERENCES Bierman Jr., H., & Smidt
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Ratnam, G. (2005, December 12). Big
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Brian C. Payne, Captain Instructor
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A Transactions Cost Economics (TCE)
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SECTION 1: INTRODUCTION This report
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SECTION 2: REVIEW OF TRANSACTION CO
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cooperative agreements, but since t
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characteristic that defines many ou
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The added risk faced by military co
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J) Some Empirical Evidence On the w
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unproductive bargaining and influen
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also include the costs of internal
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N) Results from a Bargaining-game M
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efforts to screen for reliability a
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Program Managers lead Program (Proj
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Table 2. Research, Development, Tes
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To minimize transaction costs for t
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A recent initiative to accommodate
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Technical complexity within a syste
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As briefly introduced above in Sect
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Table 5. Typical Contract Type by P
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multiyear procurements and other ty
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Alpha Contracting reduces procureme
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SECTION 4: SYNTHESIS AND CONCLUSION
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Finally, DoD contracting practice w
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Productive Effort Parameters Unprod
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f. Operational Significance. (added
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enchmarks, and the like. Elements T
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Cooter, R., Marks, S., & Mnookin, R
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Nissen, M. E. (1997). JSOW alpha co
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Development of Measures of Success
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of acquisition practitioners to all
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Attributes of Good Metrics. Certain
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Center ACEs were from separate loca
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unique. Every interview transcript
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appropriate. However, when asked if
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they are receiving in their attempt
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forcing each activity and report to
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Force Space Command System Program
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corporate Air Force acquisition ini
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Hayes, B. Measuring Customer Satisf
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Pope, K. Measuring the Effect of th
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Using KVA and Real Options Analysis
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Estimating Return on Investment and
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This research project gathered info
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“I have determined that the curre
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On Budget Allocation to Increase Op
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Panel - Perspectives in Program Man
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Best Practices: Better Support of W
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When Should You Terminate Your Own
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- Management activities, expenditur
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RF COMMUNICATIONS DIVISION ROCHESTE
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REQUIREMENT HF MANPACK TACSAT VHF/F
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Figure 4. System Components INTEGRA
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My best technical experts would spe
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“JULIE-GATE” The program was st
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All agreed it was finally over, and
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A short time later, the world waite
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some of NASA’s Mars probes) or if
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managing systems with tipping point
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The second example of tipping point
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Although the plant did not begin co
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snt - add-new-tasks strength {work
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einforcing loop. We show how, throu
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there is no more project backlog. F
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Frac requiring rework (Frw ) 1.0 0.
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Total Backlog as a Fraction of Inti
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provide opportunities for improveme
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divided into avoiding tipping point
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The horizontal axis of Figure 14 re
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Total Backlog Total Backlog/Initial
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deadline and ensuring that it is re
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unrealistic due to drastic changes
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Kharbanda, O., & Pinto, J. (1996).
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Panel - Service Contracting Thursda
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Managing the Services Supply Chain
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include professional, administrativ
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Service Characteristics and their I
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given stage is made dependent on th
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contracted effort. The procurement
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Construction, Repair and Maintenanc
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The second phase of the procurement
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human capital. This is partially du
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for the contracting of services wil
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Yet a RAND study of the Army showed
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services, the Army appears to have
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(janitorial) services, food service
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Each requirement organization provi
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Brown, S. W., Gummesson, E. Edvards
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Gronroos, C. (1982). Strategic mana
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What Works Best when Contracting fo
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Panel - Earned Value Management Thu
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Measuring Uncertainty in Earned Val
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level of rate-of-change and the abs
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But, if the widget is only half com
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so more rapidly in environments cha
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Impending Task Delays (ITD) can be
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with: v: In the Fisher model, it re
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In discrete time form, the estimati
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Thus, various types of delay such a
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Entropy The uncertainty (non-specif
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Panel - Contractors in Support of M
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Contractors Supporting Military Ope
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drivers and other historical refere
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Another factor driving toward incre
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number of highly experienced Blackw
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Unity of command is one of the prin
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was reimbursed for expenses actuall
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principles, such as unity of comman
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aircraft involved in re-supply miss
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President Cheney) has apparently ma
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modest proposals for incremental ch
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In July 1937, the “China Incident
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President Roosevelt’s assistant,
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Pilots of the Flying Tigers receive
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was larger than the marine aid stat
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Merchant vessels kept Britain in th
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The final vignette involves Charles
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contract (Wake Island pre-war). In
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purposes continues to be the “leg
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Going to War with Defense Contracto
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Abstract This paper reports on an e
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Table 1: Factor loadings and alpha
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depict causal relationships tested
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work-related experience than younge
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Discussion and conclusion On averag
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2003 - 2006 Sponsored Acquisition R
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NPS-PM-04-017 Matthews, David. The
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Technical Reports NPS-GSBPP-03-003
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