Real-Time Buying

Agencies work to link procurement with their financial and business systems.

For more than a decade, experts have speculated about the savings and efficiencies that could be realized if agencies set up procurement shops on the Web.

But creating comprehensive, integrated e-procurement systems is neither quick nor easy. The government still has a long way to go, but many agencies are laying the foundation for seamless cooperation between acquisition and finance offices.

The General Services Administration has developed the Integrated Acquisition Environment, a series of nine systems designed to "facilitate, unify and streamline each phase of the federal acquisition process," according to project's charter. The systems-including FedBizOpps, the Excluded Parties List and the Federal Procurement Data System-have become ubiquitous, and seven are now required by the Federal Acquisition Regulation.

The agency has created a long list of other electronic acquisition tools to ease the use of GSA contracts. For example, e-Buy is an online system that simplifies the request for quotes and request for proposal processes; e-Library, a market research and resource tool, collects information on GSA contracts.

GSA Advantage!, which the Federal Acquisition Service's Harold Roach calls the flagship system, is one of the oldest electronic tools for federal employees who have purchasing authorization. Rolled out in 1995, the Amazon.com-like shopping system has 14 million items available for purchase and covers about 16,000 GSA contracts, according to Roach, user support branch chief at Office of the Chief Information Officer. While GSA Advantage! is primarily for smaller orders averaging $650, the system did $450 million in business in 2006.

GSA is developing systems to streamline the contracting process for industry as well. The agency recently rolled out a new phase of its Multiple Award Schedule Express Program, complete with automated offer review technology, called the Schedule Program Express Evaluation Desk. The program completes the initial review and qualification of applications to be included on the GSA schedules and then notifies vendors whether they meet the criteria. If a vendor is turned down, the system presents other available options. The goal of SPEED, as the program is called, is to give eligible companies a place on the schedules within 30 days instead of the 120 days it sometimes takes.

Several agencies are developing internal systems to link procurement to other parts of their operations. The Health and Human Services Department, for example, has launched the One HHS initiative, which includes the Unified Financial Management System to improve financial and business functions across its agencies. As part of the system, HHS has moved forward with a consolidated acquisition solution. HHS used commercial software, such as Oracle's iProcurement and Compu-search's PRISM to move the contracting process-from requisition to payment-online. "It's all off-the-shelf software," says Mike Fullem, director of the consolidated acquisition solution at HHS. "We're not customizing it; offices have to standardize their business processes to fit the software . . . that's the beauty of off-the-shelf." Fullem consulted with other agencies that are using the software with success, primarily the Agriculture Department.

The main goals are faster processing, standardization of acquisition procedures across agencies and real-time interaction with the financial management system. "The finance people get real-time funds checking and commitment accounting, and the procurement people get a faster, more streamlined, paperless product." Fullem says. Getting up-to-the-minute funds availability is especially important at the end of the fiscal year when large numbers of requisitions go out at the same time, he says. Fullem hopes the system eventually can be expanded to include electronic invoicing and proposals.

The State Department has incorporated electronic acquisition into its broad Integrated Logistics Management System, which manages everything from procurement to tracking diplomatic mail to shipping employees' household goods. The system is "a full life cycle program," involved in every step of the process from the time someone wants something, to the time they receive it, use it and dispose of it," says Cecilia Coates, State's acting director for program management and policy.

State customized commercial software from Ariba Inc. for requisitions to make it compatible with the Federal Procurement Data System. Off-the-shelf software is user-friendly and looks similar to online shopping sites employees might use at home. "For anyone who's ordered off an Internet shopping site, Ariba has a good look and feel that is familiar to them," says William Moser, deputy assistant secretary for logistics management. State also has updated its contract award and management system, Momentum Acquisition. "Probably one of the greatest benefits to the department overall has been the real-time integration with the financial system. It really does decrease a lot of workload across almost every part of the logistics process," Coates says. The system is almost completely paperless, which cuts cost and boosts efficiency.

The department received kudos from users for the system's status tracking function, which allows people to monitor their acquisition requests as they might track a package on the UPS Web site, Coates says. "We've put a lot of priority into making sure . . . they know what the status of their transaction is at all times."

State's logistics management system is deployed nationwide and at several embassies and posts overseas. The procurement portion of the system caught on particularly in Central and South America as word spread. The agency hopes to expand it internationally as soon as possible, but Coates and Moser say it takes money to train users, provide support and ensure secure integration with the financial management systems abroad.

Some agencies have made strides in developing overarching systems for acquisition and financial management, but e-business is not likely to become the governmentwide norm all at once. Agencies learned that building these systems takes a strong foundation followed by phased expansion and upgrades-not to mention time, money and patience.