Thanks to epic problems with HealthCare.gov’s rollout, the federal government’s out-of-date technology processes have received more attention than most of us could have expected. The main doorway for millions of Americans to get health insurance was unusable for two months, but that screw-up is just one in a long line of government IT failures. In the flood of embarrassing government tech anecdotes that have come out since, we’ve learned a key federal agency still relies on floppy disks.
The problems put procurement — government’s process of acquiring technology work and software — at the center of public conversation, press coverage and even a meeting between the president and the nation’s top tech CEOs. After all, we’re talking about hundreds of millions of public dollars being spent on projects that get scrapped. The New York Times lists some notable recent failures and their price tags:
“The Air Force last year scrapped a $1 billion supply management system. Officials abandoned a new F.B.I. system after spending $170 million on it. And a $438 million air traffic control systems update, a critical part of a $45 billion nationwide upgrade that is years behind schedule, is expected to go at least $270 million over budget.”
What should be done about government’s tech issues depends on what you see as the source of the problem. And that’s where there’s disagreement among the “People Who Think About Procurement More Than You And Me.”
Stan Soloway heads the Professional Services Council, which represents federal contractors who are hired to build these projects. He told The Times he sees the problem as the “punishing and punitive” environment of government.
“It’s the human capital, the way the government buys services, the way the government determines its own requirements, the lack of collaboration within government, the lack of collaboration between the government and the private sector, the outdated systems within government,” Soloway told the newspaper.
Clay Johnson, who has been fighting for procurement reform since before it became cool, takes issue with that argument. “Bad clients exist everywhere,” Johnson writes in a recent blog post. “Part of being a good consultant means being able to work with clients at all levels of knowledge, and even teaching them how to be great clients to work with. Blaming the client is the oldest trick in the book. It’s toxic.”
Instead, he sees the issue as being an environment that doesn’t favor competition, which boosts incumbents who do mediocre or even poor work. Johnson writes:
“It takes months of process negotiation for a company to get a check, that some governmental bodies make companies do all the work up-front before collecting a check (thereby locking out all but the largest businesses from competing), and avoiding competition altogether by buying things off of pre-negotiated contracts all favor incumbency. And incumbency is the enemy of innovation.”
We’ll continue to watch this conversation, and we want to put this question to investors who back private tech startups: Do you fund companies that want to work with government? If not, is it because of the client, or the barriers to even getting government contracts?
Determining what’s at root will drive future policy decisions.
President Obama has said again and again that government needs to improve the way it procures and uses technology. But so far, the White House hasn’t put out any specific plans to tackle the issue.
On the legislative front, the bipartisan bill to address part of the problem — the Federal Information Technology Acquisition Reform Act (FITARA) — passed the House last June but got axed from the Senate version of the defense bill on which it passed. That bill did not centrally take on the competitive environment, but it would have given more power to technology officers inside government so they could better project-manage the work of contractors and developers.