NEW MEMO EXPECTED TO STRENGTHEN CATEGORY MANAGEMENT
Expect further consolidation of contract methods, more centralized acquisition, and continued data collection and remittance requirements from a new Category Management memo expected soon from the Office of Federal Procurement Policy (OFPP). OFPP leaders are serious about making further reductions in contracting overhead, which could also result in reducing the number of contractors, while better leveraging the government’s collective buying power. For service contractors this may mean that the savings the government could not achieve via the commoditization of labor categories could occur via limited, standardized contracts. In addition, contractors can expect to have data collection and remittance requirements in each contract so that government leaders can analyze prices paid with the ultimate goal of dramatically reducing spending. Left unsaid, for now, is whether OFPP will attempt to actually mandate the use of specific contract methods to the exclusion of others by threatening agency budgets for those who refuse to go along. So far, CM comes right up to the line of making specific contract use a “thou shalt”. Agencies generally go along with the CM guidelines, but also have flexibility to do their own thing. Removing that freedom would be a sign that OFPP believes that they can succeed where others have failed. Don’t get stuck with obsolete contracts that drive little business. Stay tuned for OFPP’s memo.