On-Demand with Raj Sharma

This morning, I have the honor of introducing Spend Matter’s On-Demand interview series. Our first guest for the series, Raj Sharma is the founder of Censeo Consulting Group, a boutique strategy consulting firm with deep expertise in sourcing and procurement, especially in the federal sector. It is currently running, what is arguably the largest strategic sourcing program in the world for the Department of Defense. Of the dozens, maybe hundreds of sourcing consultants I’ve met and worked with over the years, I thought I’d interview Raj today because he possesses a unique knowledge of the federal sector which we can all learn from. More important, I consider Raj our frontline defense – no pun intended – from higher taxes. The more his firm can help our government better manage spend, the better off we all are! Spend Matters: First, what is your background and how did you begin to work closely with the federal government on Spend Management issues? Raj: As a consultant at Booz Allen Hamilton, I worked with almost every federal government agency addressing issues related to organizational change and business transformation. I quickly realized that the federal government presents a bigger challenge from a consulting standpoint as every project must account for the complex federal regulations, entrenched business practices, and various internal and external stakeholders. Spend Matters: When it comes to Spend Management and strategic sourcing, how is the federal government different from the private sector? Raj: As we all know from the recent press regarding Boeing and Halliburton, competition is an essential component of federal procurement (editors note: at least by law, though, not always in practice). The Federal Acquisition Regulations (FAR), the rules governing government procurement, are extremely complex and designed to ensure competition and avoid misuse of taxpayer dollars. Any strategic sourcing program must account for the implications and limitations placed by the FAR. Additionally, strategies such as supplier rationalization can not be treated the same way as they are in the private sector. Small business requirements, in many ways, limit the options available. Federal agencies also must account for the various stakeholders such as Congress, Small Business Administration, end users, contracting community, etc. These examples magnify the need for creative thinking and approaches for strategic sourcing, not the typical processes that have been applied in the private sector. Spend Matters: Given this complex environment, what are savings opportunities from strategic sourcing? Due to the decentralized and fragmented nature of federal procurement, aggregation is still a great opportunity to create savings but it must be applied within the context of the FAR. Additionally, substantial savings opportunities exist through demand management. Many agencies have little control over spending, resulting in unnecessary requirements and overspending. Business processes are often manual and inefficient. Compliance against existing contracts, both in terms of internal users and in terms of supplier adhering to negotiated terms and conditions and pricing is another area where not a lot has been done to date. Spend Matters: What is Censeo’s focus in the federal government? We are currently running some of the major initiatives in strategic sourcing across the government, including running the largest strategic sourcing program in the world for DoD. We are involved in organization design and program setup as well as facilitation of various commodity teams. This marks the end of our first On-Demand interview. Got an interview topic which you think is worth investigating? Drop a line: jbusch@spendmatters.com
Jason Busch

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