Department of Veterans Affairs Strategic Acquisition Center Association of Military Surgeons of the United States – Sustaining Members February 24, 2015 Mr. Robert Jones Contracting Officer & Procurement Division Chief

The Future of VA Acquisition  The VA’s Secretary vision is to restructure VA’s acquisition and construction business practices to achieve desired outcomes that result in improved services to Veterans and their families while controlling cost

Secretary’s Acquisition Strategy

Secretary’s Acquisition Policy

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Gain control over acquisition management information

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Achieve clear ownership and accountability of VA contracting mission

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Effectively manage the acquisition lifecycle

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Achieve a $2.0 billion return on investment

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Pursue standardization/strategic sourcing

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Measure and improve customer satisfaction

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Manage data to drive mission outcomes

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Implement necessary changes while promoting transparency to our customers and stakeholders

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Implement a program management culture

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Improve contracting workforce competencies

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Improve the acquisition management workforce

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Leverage technology to ensure an enterprise management approach

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OAO/SAC Office of Acquisition Operations (OAO) The Office of Acquisition Operations provides comprehensive, strategic acquisition support for VA’s highly complex requirements, including strategic Information Technology and medical systems. OAO also recommends policies, plans, and strategies for VA-wide application on contract administration, acquisition planning, procurement, and contract administration in connection with acquiring supplies, equipment and services required for the provision of benefits and medical care to the nation’s Veterans. The Office of Acquisition Operations’ primary focus is to provide customers valueadded acquisition business solutions. Major OAO business lines include • Acquisition of Supplies, Equipment and Services • Manage and Administer Interagency Agreements • Represent VA on Intergovernmental Acquisition Groups • Agency Competition Advocate

Strategic Acquisition Center (SAC) The Strategic Acquisition Center (SAC) was established under OALC/OAO to implement strategic sourcing initiatives for the Department and handle contracting requirements that exceed the field purchasing thresholds (Executive Decision Memo; April 27, 2010). Located in Fredericksburg, VA and Frederick, MD the SAC (and SAC Frederick) develops non-IT contracts that support strategic sourcing initiatives, cost-saving business cases based on ideas from the field, best practices from industry and performance-based strategies. SAC contracts include blanket purchase agreements, enterprise Indefinite Delivery type contracts (IDIQ, Requirements, etc.) and unique, risk-based contracts. 3

Strategic Acquisition Center • Since opening in spring of 2011, SAC has awarded over 80 contracts/BPAs totaling in excess of $1.5 Billion • In FY 14 SAC exceeded it Small Business socioeconomic goal of 46% by awarding over 60% of its dollars to Small Businesses ($64 Billion)

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Acquisition / VA Facts

•3 SAO •21 VISNs •153 Hospitals •600 CMOPS • VA Employees* •Acquisition Employees *As of September 20, 2014, VA had 312,841 employees on the rolls. Among all departments and agencies of the federal government, only the Department of Defense has a larger work force. Of the total number of VA employees, over 288,000 were in the Veterans Health Administration, 16,135 in the Veterans Benefits Administration, 1,549 in the National Cemetery System, 3,412 in the Veterans Canteen Service and 437 in the Revolving Supply Fund. The rest, 9,919 employees, are in various staff and facilities offices. CMOPS (Consolidated Mail Outpatient

Pharmacy

SAC’s Primary Customer: VHA – 80% Spend

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OMB Definition/Strategic Sourcing A collaborative and structured process of analyzing an organization’s spend and using the information to make business decisions about acquiring commodities and services more efficiently and effectively.

Expected Benefits • Cost Savings: Enable higher visibility into agency wide spend and help achieve costs savings by leveraging buying power • Process Optimization: Serve as a platform to eliminate process inefficiencies and streamline acquisition transactions

Expected Benefits (cont.) • Standardization: Promote standardization of acquisition processes across the agency • Enterprise Collaboration: Provide a collaboration platform to enable cross-office decisions

STRATEGIC SOURCING AND ENTERPRISE SPEND MANAGEMENT Spend Analysis

How are we buying? ENTERPRISE SOURCING STRATEGIES

For whom are we buying? END USERS

What are we buying? COMMODITIES OR SUBCOMMODITIES

From whom are we buying? SUPPLIERS

A multi-dimensional analysis to identify historical spending patterns and to bin spending into logical categories and sub-categories (Portfolios)

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Total Cost Approach

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Expanding the Perimeter of Managed Spending

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Classic Portfolio Management Process (Enterprise Spend Management Model) Spend Analysis

Form the Councils

Start

•Conducted on data for commercial, Repeat interagency, and p-card activity for prior three year period

SAC ARRS rep

IPT

Fiscal rep OGC rep

Market Research

•Review Spend Analysis •Review inventory of existing contracts •Obtain Alignment on priorities for Enterprise Wide Contract development

SAC Branch Chief /staff

OSDB U rep

Execute Strategy

•Develop SOW/PWS or SOO and performance criteria •Stakeholder/user buy in •Identify source selection team •Issue solicitation •Award Contract

Review Current Strategy

Program Office Lead Other Office Stakeholders

Performance Management

•Roll out strategy •Build and manage contractor and stakeholder relationships •Monitor contractor performance •Manage agency and stakeholder performance within budget goals •Plan for change

•Stakeholder Support •Get the right people •Organize the Councils

•Define user requirements •Conduct market research •Review capability statements •Identify potential suppliers •Recommend sourcing strategy •Develop Advanced Procurement Plan

Inform Budget

•Develop budget estimates for council portfolio •Develop supporting narrative for budget estimates

Challenges (Mitigations) Government • • • •

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Managing customer expectations - Proper planning, flexibility, creativity, customer education (being realistic) Developing contractual vehicles the customer will use - Better pricing, terms & conditions, delivery, streamline process Meeting VA Small Business goal with enterprise contracts - Fair and equitable implementation Navigating regulatory requirements - SB Set-aside rules - NAICS Standards - Non-Manufacturer Waiver - Justifying large business GSA FSS Rates, “Preponderance of Work Location" (allowing higher rates) - Educating Government and Industry representatives on GSA process 13

Challenges (Mitigation) Industry •

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Understanding Government contracting process - Ask questions, contact SBA and OSDBU for help - Business is not always automatic Know your customer - Reach out to customers, communicate; with contracts and without - Be cognizant of actual need; don’t over/under propose - Government is not always standardized; DoD, VA, Commerce, etc. Strategic Sourcing, Enterprise-Wide Contracts result in lost business - Consider teaming, partnerships, Joint Venture, Mentor-Protégé Program - Large businesses can assist small; small businesses can help large as well - Establish GSA and/or VA Federal Supply Schedules (FSS) - Consider inclusion on Multi-Agency Contracts (MAC) and similar 14

Challenges (Mitigation) – Industry (cont.) •

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Read the Request for Proposal/Quote; Instructions to Offerors - If you don’t understand, don’t guess, ask - Don’t wait until the last minute to submit your proposal/quote - Avoid “recycling” old proposals as a last resort Ask for a debriefing, why didn’t I win, why did I win - Please keep emotions in check GSA FSS Rates, “Preponderance of Work Location" (allowing higher rates) - GSA Representatives will expedite increases to schedule pricing for markets where your rates don’t meet minimum DOL rates

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Examples of SAC’s Strategically Sourced Contract Vehicles: TITLE

AWARDEE AND PERIOD OF PERFORMANCE

EVENT PLANNING & SUPPORT

• • • • •

TASCO TEMPORARY ADMINISTRATIVE SUPPORT & CLERICAL OPERATIONS

IPT & FASS INTEGRATED PRODUCT TEAM AND FACILITATION & ACQUISITION SUPPORT SERVICES SERVICE ANIMAL INSURANCE

Ian, Evan & Alexander Corporation Pothos, Inc. American Small Business Alliance, Inc. National Conferencing, Inc. TCG Consulting, Inc.

POP: May 31, 2013 – May 30, 2018 • ADINO, Inc. • Career Management Associates LLC • Citadel Federal Solutions, LLC • Distinctive Personnel • Golden Key Group • Precision Infrastructure, Inc. • Skyline Ultd, Inc. • TDB Communications, Inc. POP: August 23, 2013 – August 22, 2018 • Monterey Consultants, Inc. • Premier Management Corp. • ADDX Corp. • Integrated Solutions, Inc. • Cline-Morin Associates, Inc.

CONTRACT VALUE

$60,000,000

$206,250,000

ZACHARY WILCOX [email protected] PHONE: (540) 479-8450 $225,000,000

POP: October 25, 2013 – October 24, 2018

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Trupanion

POP: August 22, 2013 – August 21, 2015 •

Sig Sauer, Inc.

POP: December 19,2013-December 18, 2018 DAVINCI ROBOTIC SURGICAL ARMS

•

•

$990,000

JAMES POE [email protected] PHONE: (540) 479-8450 Michael Busansky [email protected] (540) 479-8450

Intuit Surgical Inc.

POP: March 10, 2014 – March 9, 2019

CEVN AND CVT EQUIPMENT AND HELP DESK SUPPORT AND MAINTENANCE

ZACHARY WILCOX CONTRACTING OFFICER [email protected] PHONE: (540) 479-8450

ROBERT JONES CONTRACTING OFFICER [email protected] PHONE: (540) 479-8450

$5,600,000

VA FIREARMS

POC

$142,000,000

Iron Bow Technologies

JAMES POE [email protected] PHONE: (540) 479-8450 VICKI WHITEMAN [email protected]

POP: June 20, 2014 – June 19, 2019

$49,914,179.28

PHONE: (202) 578-8057

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Future Activities / Expectations • Establish a Medical/Surgical Prime Vendor Contract (allow Ordering Officers) • Establish Multiple-Agency Contracts (MAC) for VA Acquisition Academy Curriculum Development • Continue to increase efficiency, 15%-20% savings defines success

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QUESTIONS?