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Testimony Regarding the Implementation of the Fiscal Year 2014 Budget Enhancement - July 11, 2013

Thursday, July 11, 2013

Good afternoon, Chairman Mendelson and members of the Committee of the Whole. I am James D. Staton, Jr., Chief Procurement Officer and Director of the Office of Contracting and Procurement. I am here today to provide testimony regarding the implementation of the fiscal year 2014 budget enhancement and an update on the progress of the procurement reform initiative. I am joined today by members of my senior staff.

Since we last met in April to discuss OCP’s operations, we have been working to implement a number of the Committee’s recommended policy changes:

Training and Certification

We have completed the pilot phase of the first tier of the training and certification program required by the Procurement Practices Reform Act of 2010 (PPRA). To date, 25 procurement staff have successfully completed the program. By the end of the month, we expect to have in place the Memorandum of Understanding with the University of the District of Columbia - Community College to issue the certificates of course completion.  UDC-CC, an accredited institution of higher education, has already certified the course structure and materials.

By the end of October, course materials for tiers two and three will be fully developed and ready for pilot. In June we hired a course developer to create the materials for tier two that will cover complex procurement methods. For tier three, we have begun discussions with several vendors about tailoring existing project management, leadership, analytical and decision-making skills courses to the objectives outlined for the certification program. 

The training and certification program, as designed, provides contracting personnel across District agencies – including those who have delegated authority – with the tools and knowledge they need to do their jobs effectively. As with any on-the-job training, real time application is imperative. Once a contract specialist has completed the course and demonstrated that they understand the material, their work will be monitored by their immediate supervisor and our internal audit program managed by the Office of Procurement Integrity and Compliance for at least six months. If and when issues are identified, the supervisor must work closely with the staff member and the OCP Resource Management team to develop an improvement plan including appropriate professional development and disciplinary actions where necessary.

I believe that the training certification program as designed meets the needs of the District’s contracting staff at the central procurement office and agencies under the authority of the CPO. After reviewing and evaluating programs at other District agencies, the federal programs, and the training programs in various states and jurisdictions, I am certain that when completed, the OCP training and certification program will provide contracting personnel with the proper framework to ensure consistency in the quality of work for the staff under my authority.  As we work to fully implement the training and certification program in fiscal year 2014, I cannot overemphasize the importance of a Chief Learning Officer. The Chief Learning Officer will use his or her deep knowledge of the procurement profession to train and develop our current and future workforce. Filling that position is one of my top priorities for fiscal year 2014.

Recruitment and Retention

In June, we began work with the Department of Human Resources to develop an aggressive plan for recruitment, training and retention of the contracting workforce as required by the PPRA. We anticipate a plan that will focus on partnerships with professional organizations and advertising open positions on websites and social media.  We intend to exhaust the full resources of both OCP and DCHR to recruit and retain the best in the field. By early August, we expect to have a fully developed plan that will be ready to implement as we work to recruit 20 FTEs in fiscal year 2014.

DCHR is actively working on the HR Effectiveness Learning and Development strategic initiative which involves defining a learning and development strategy for the District.  This includes the development of career management tracks that are aligned to the Classification and Compensation Reform efforts.  OCP looks forward to incorporating our agency specific training requirements into this strategic model that will support the continuous development and retention of OCP employees.

Procurement Reform

Since we last met, we have selected a consultant to lead the procurement reform initiative I outlined for you at the last performance hearing and fiscal year 2014 budget hearing. Progress toward our goal to increase procurement efficiency, streamline business processes, improve procurement planning and monitoring, and better serve the contracting needs of client agencies is well underway. The consultants are completing a review of procurement activity for agencies under the CPO’s authority to get a better understanding of the type and volume of activity at each agency.

On July 1, a survey was distributed to all client agencies to provide feedback on the services provided by the staff at OCP. The survey asks the respondents to rate the quality of support received from OCP in the procurement lifecycle such as solicitation planning, bid evaluation, negotiations, and contract administration. Additionally, respondents are being asked to provide feedback on how to improve coordination with OCP.

The consultants also began to compare OCP regulations, the 27 DC Municipal Regulations, to the requirements defined in the PPRA to ensure consistency, and identify regulations that need to be revised to more fully comply with the PPRA. Through this review, regulations that are not rooted in the PPRA will undergo further examination to understand the merits and viability (such as strengthening internal controls and management oversight). As applicable, regulations that are not legally required may be considered for elimination to streamline processes and improve efficiency.

Lastly, interviews with deputy mayors, directors, managers, program analysts and contract specialists are in progress. A key objective of the interview process is to review the practical application of policies and procedures as well as processes to include workflow, approvals, and monitoring to achieve a comprehensive overview of the entire purchasing structure.  We anticipate a preliminary report of findings from these key activities will be completed by the middle of August.

An assessment of the skills and capabilities of personnel, for roles and functions within the procurement structure, is among the key next steps.  The personnel or workforce assessment is intended to serve as a high level appraisal of the current knowledge (experience level), skills (training), and abilities (position) of representative staff from OCP staff and target agencies. The assigned job position statements and job titles will establish baseline qualifications and performance expectations. These standards will be used in the review of work assignment-type, workload analysis, and performance measurements established by the respective agencies.
Through the assessment process, there will be an appraisal of whether staff skills align with the work effort required. In addition to identified skill gaps, training recommendations will consider industry standards to build competency and proficiency in the District’s procurement teams. Training priorities will include formal instruction on implementation of new or revised operating procedures that may be developed as part of the procurement reform initiative. The personnel assessment task is scheduled to conclude by October 2013.

A six month pilot program will be implemented to put procurement processing and management system improvements into action. The pilot program structure will be based on an Integrated Product Team (IPT) model, which is an industry recognized procurement efficiency best practice. Through the IPT technique, pilot program agencies will plan, process, and manage acquisition activities using multidisciplinary teams of specialists to optimize the quality of procurements.

Multidisciplinary teamwork will integrate all the essential functional requirements of goods and services purchased – from specification development to contracting to performance monitoring. Pilot agencies will identify specialists (e.g. program management, design, financial management, procurement, contract administration) to form the internal teams that will be responsible for coordinating all processing requirements to achieve performance benchmarks, including quality standards and production timelines. Active District procurements will be developed and managed through the IPT technique, which will eliminate the functional silos that often result in bottlenecks, and ensure that the appropriate business model, contract type and procurement methodology is targeted to the specific purchasing requirements.

The District Government and vendors/contractors will benefit from reliable specifications and cost estimates for goods/services, transparency in the solicitation and evaluation process, and consistent standards for contracting and monitoring. The procurement reform program will help alleviate bottlenecks and operating constraints and sufficiently improve purchasing and contracting systems. The procurement reform technical assistance project will conclude in the April 2014.

Conclusion

In conclusion Chairman Mendelson, I want to thank the staff at OCP for their hard work and their commitment to the organization. Thank you to Mayor Gray and City Administrator Lew for making procurement reform a priority in the District. I look forward to being able to share more with you next fiscal year during our scheduled briefings with City Administration Lew. Thank you for the opportunity to testify and I am happy to answer any questions you may have.