HHS ACQUISITION INITIATIVES ANGELA BILLUPS, Ph.D. Associate Deputy Assistant Secretary for Acquisition Senior Procurement Executive February 19, 2015 HHS Acquisition: Ready. Resourceful. Responsive.

Acquisition Focus Areas for 2015 Acquisition Lifecycle Management and Reform Buying Smarter Data Quality Advancing Mission Performance Key Success Factors

Acquisition Lifecycle Management and Reform Standardize Acquisition Practices HHS Acquisition Regulation (HHSAR) Update Supplements and is Aligned with the Federal Acquisition Regulation (FAR) Removed Duplicative Language Already in the FAR Removed Internal HHS Policy/Guidance and Other Outdated Content Reinstituted the FAR as HHS Regulatory Guidance Along with Supplements in the HHSAR Electronic Portal House Internal HHS Policy/Guidance Organized, Universal, Clear and Concise EE HHSAR E-PORTAL YOU

Acquisition Lifecycle Management and Reform HHSAR Development - Significant Effort Collaboration - All Operating and Staff Divisions Multiple Meetings and Numerous Topics Multiple Sub-group Meetings Details of Team Accomplishments Pages Before 350 – After 178 Proposed Final Rule Includes Comments Resulting from HHSAR Team Review and Specific Operating/Staff Division Input 628 Comments - Initial Review of Updated HHSAR 67 Comments - Executive Secretary Review Process Local Clauses Reviewed and Adjudicated 182 Reviewed 42 Became HHS Standard Clauses

Acquisition Lifecycle Management and Reform Improving HHS Acquisition Lifecycle Management What is Acquisition Management? Acquisition Management is a Federal Government best practice that provides a structured framework and processes for the acquisition of products and services to support a program/mission needs, and: Is a cradle-to-grave approach that begins with identification of the business need and supports the entire lifecycle of the program Integrates distinct silo functional processes, such as requirements management, budgeting, contracting, IT and project management Entails an integrated cross-functional team approach to managing the program Provides a holistic approach to monitoring and providing Government oversight to contractor led efforts Acquisition Management is not contract management. It is owned by the Program’s Business Owner; supported by contracting.

Why Does HHS Need Acquisition Management? Most large programs fail because of poor strategy and planning, inadequate definition of the business need, and inability to continually manage risks in the program Complex functional processes for budgeting, contracting and IT are silo’ed – there is not an integrated product team approach to managing the program IT and non-IT needs are not integrated from a program perspective to ensure optimization of resources Contracting is often looked at as a “silver bullet” or blamed for failure when the responsibility for the program strategy and execution rests with the business owner There needs to be a clearly identified owner for the program who is accountable and responsible for program success and is empowered to make decisions Clear roles and responsibilities are needed for the Acquisition team supporting the program under the leadership of a qualified Project/ Program Manager (P/PM) An appropriate degree of program oversight is needed to ensure that there are checks and balances in place and a governance structure to support prompt escalation and management of issues

Acquisition Team Roles & Responsibilities Milestone Decision Authority (MDA) Responsible for making acquisition investment decisions and providing approval at each Milestone Decision Gate for programs with a total acquisition cost of less than $20M (Division Head) Program/ Project Manager (P/PM) Leads Integrated Product Team Makes program decisions based on strategy established by leadership Establishes Acquisition Strategy and Acquisition Plan Manages risks continually through program life cycle Manages costs, schedule and performance (scope and contractor performance management) Business Owner(s) and stakeholders Sets program strategy, objectives and performance metrics Owns the processes and business needs Establishes business requirements and priorities Program operations including customer support Head of Contracting Activity (HCA) and Contracting Officer (CO) HCA provides leadership for contract execution. CO is the exclusive agent of the Government empowered as the signatory authority for execution pre and post award contractual documents. Provides direction to contractor based on PM’s decision Contracting Officers Representative (COR) Supports day-to-day administration of contract assuring compliance with contractual requirements Monitor contractor progress and performance in collaboration with the PM Liaison between PM and CO for any contract issues and modifications Tracks contractor deliverables, approves invoices COR cannot be a PM for the same contract CFO/Budget Representative Supports establishment of business case and IGCE Ensures budget requirements are validated and ensures availability of funding CIO/IT Representative IT Capital Planning and Investment Process Manages development, testing and deployment of IT systems to meet business needs Information security and privacy

Acquisition Lifecycle Framework Mission Requirement 1. Form the Team Plan 2. Define Mission Business Needs Leadership Support Build the Team Assess Program Life Cycle/Risks Consider Strategic Plans & Budget SB Mission Owner Tech Legal CIO CO Buyers QA Reps CORs CFO Stakeholders Acquisition Team 3. Identify and Align Resources Program/ Project Manger Analyze Resources and Gaps Internal/External Resources Mission Results 4. Requirements Definition Draft Requirements Roadmap Consider Acquisition Forecasting 7. Performance Management 5. Acquisition Strategy Monitor Program Performance Build & Manage Relationship Manage Contract Performance 6. Acquisition Planning Business Strategy (Program/Project) Acquisition Strategy/Risks Execute Strategy Implement Acquisition Plans Award Contract Execute Develop 8

Acquisition Lifecycle Structure Conceptual Phase Program Definition Phase Program Development Phase Program Execution & Delivery Phase Operations & Maintenance Phase Business Need Identified Milestone A Milestone Review Milestone B Milestone C Milestone Review Adopt an Agile approach to delivery where feasible Establish PM and IPT Define what is needed – not how Define business objectives Conduct Risk Assessment Establish ROM Establish Business Case Conduct Analysis of Alternatives Establish IGCE Define Acquisition Strategy Define Concept of Operations Develop Capability Requirements Doc Finalize & Prioritize Requirements Acquisition Planning – contracting strategy Validate cost estimates and availability of funding Establish program management baseline (scope, cost, schedule) Award contract(s) Contract management Configuration management for changes to baseline Requirements traceability Test and accept contractor deliverables Deploy capability Support customers Monitor performance metrics and SLAs Configuration Management Change Control Continuous improvement Continually monitor and manage risks throughout the life cycle

Buying Smarter Drive Innovations - Prioritize Efforts for Buying Smarter Maximize Contracting with Small Businesses Strategic Sourcing/Category Management/Acquisition Gateways Strategic Sourcing – Leveraging Volume Buying Category Management Managing commonly purchased areas of spend Collectively developing heightened levels of expertise and sharing best practices Providing acquisition, supply and demand management solutions.  What are Acquisition Gateways https://hallways.cap.gsa.gov/homepage/welcome.html Evaluation/Report/Utilize Past Performance Information Improve Service Acquisition Initiative/Analysis Improve Vendor Relationships

Other Acquisition Initiatives Data Quality Continue Transparency Initiatives Data Act Standard Definitions Across Functional Areas (Acquisition, Grants, Finance, Budget, etc.) Advancing Mission Performance Improving Acquisition Business Systems Open Communication with Operating/Staff Division Leaders Key Success Factors Excellence in Acquisition (Policy, Standardized Practices, Systems and Programs) Professional Development and Certification Stakeholders Integration Customer Relations - Collaboration and Management

Next Steps HHSAR Proposed Final Rule Federal Register Notice Signed Feb 2015 – Awaiting Publication for Public Comment Implement Acquisition Lifecycle Framework to Improve HHS Acquisition Management Support Federal and HHS Acquisition Initiatives Improve the Method Used to Train the Acquisition Workforce

QUESTIONS U.S. Department of Health and Human Services 200 Independence Avenue, SW. Washington, DC 20201