US General Services Administration – is there an appetite for change?

We’re going to have quite a bit about the UK public sector next week, but we recently featured the US General Services Administration conference / pi*s up in Las Vegas that led to the sacking or resignation of various high profile executives.  Shortly afterwards, I had the pleasure of speaking to a very eminent US based public sector procurement guy. After treating him to an English beer or two, I asked him about the GSA. Turned out he knew the organisation very well indeed.

“The problem is”, he said, “their role and operating model was changed a few years ago. It was decided that they would have to go and sell their services to other Government organisations, and persuade them to use the GSA contracts and services. It changed the whole way they approached matters”.

And not for the better in his view.

“They really went from being a procurement organisation to being a sales organisation. They put deals in place, but then they have to persuade people to use their deals in order to make a margin. So they are inevitably more interested in offering users lots of choice rather than doing real strategic sourcing or category management”.

That sales focus explains perhaps some of what we saw with their event. Think of it as a sales conference, perhaps seen as a reward for hitting sales targets, rather than a group of dull procurement folk getting together to discuss how to squeeze a bit more out of suppliers... and it starts making some sense.

His comments also brought to mind a number of UK parallels. That sales focus was very much how OGC Buying Solutions worked for years – put in place lots of different contracts and suppliers that public bodies might want to use, and make your margin on that, rather than looking  drive rationalisation, aggregation and contract compliance. To give the current government credit, that is something  that has changed, and Government Procurement Service under David Shields has much more of a procurement focus than a sales one.

My new friend also added that “the GSA doesn’t really want to change in my opinion. To do that would take a major effort in terms of staff training, and re-aligning the strategy and processes. I don’t see any real appetite for that sort of change”.

Another reason to give the UK government some credit. We may pick holes in the programme to promote SMEs, or complain about the chaos in health procurement, but there has at least been a concerted effort to re-engineer central government procurement. That has included a re-focus of GPS and a move away from the sales-led approach that has clearly caused problems for the GSA.

While that’s a limited part of the whole picture, it appears to be several steps ahead of anything in the US. Indeed, while we are at something of a distance, we’ve seen nothing that suggests an appetite for serious procurement re-engineering, improvement or change in Federal US procurement.

But, as the US will inevitably have to face their own huge budget deficit at some point, we might then expect to see some serious procurement focus and initiatives. Just not yet...

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