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+Clay Johnson makes some really great points about how to fix government procurement. This one is a must-read. I wish lots of people in government (but especially those with the ability to change something) were paying attention!

Starts with a notion that should get attention on this libertarian-oriented medium: how Obama campaign staffers go in, face procurement, and come out libertarian, but by the end gets on to some really practical suggestions for how procurement could be radically transformed in the age of open government.
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I wish I could see 'Clay Johnson' without thinking 'Cave Johnson'.
It's not just in the federal government. I am in a University setting and you would think that things would move pretty quickly in the IT area because the university is an innovation engine. Well it turns out that is wrong, at least where I am. You find so many people that just drag everything down with bureaucratic processes and policies that sometimes you don't even try to push forward a new idea because it is just to difficult to implement.

Bean counters tend to put so many controls around the way money is spent, because they fear the Giant Bean Counters will find errors in how they are spending government money.

We go through the whole RFP process and vetting on various vendors only to end up spending much more money and not really getting what we wanted.

There is also this irrational fear of open source software and solutions. It's almost the case that if something doesn't cost 6 figures it can't be good.
If it doesn't cost six figures there's not much room for a decent kickback. (No matter how cynical you are, you can never catch up.)
I wish lots of people in the public (but especially those with the ability to change something) were paying attention!

His suggested ideas aren't half bad, but without understanding the current situation and perspective required to make the changes, they are only half good. Citing Vivek Kundra's inability to understand and work with or change the organizations he was supposed to guide, only weakens his story.

There is, in fact, a " emails going out about procurement" and that is the people of the libertarian tea party and people behind Ron Paul trying to get the government out of the business of pretending to be a commercial venture. Some of the very suggestions he states are because of the idea that members of the public are all 'customers' and 'consumers' and a person with a MBA knows best how to administer government and create cost recovery models.

I personally think the real issue Congress shirking its responsibility for the purse, a procurement process organization that overrules needs, and lack of skilled technical management before contracts are let. Even the procurement rules are backwards; you get your money before you break down your needs and provide rough estimates of costs. The only way you'll see the ship change direction is if you start having transparency in how much time the full time employees are utilized in projects: where is the gap? Think it is acquisition work force hours? Compliance: FISMA; 508; Privacy? Program Managers or project managers? Management overhead? If it was your business, what metrics would be useful - and why isn't your government showing those costs instead of just what the contracts price out? I'll bet you a donut every other time you see a high price it is because the agency in question doesn't have competent personnel to apply to the situation and must hire outside talent because they don't know how to do it themselves. Caveat venditor when you try to price your goods to someone who doesn't know their own business!
My job requires me to interact with State and Local Government Agencies. First, there are a few dedicated, intelligent and talented people who really make a difference even when hampered by onerous rules and regulations. Second, there's a surplus of people who fill a space on the organization chart. I can only attest to my frustration when at one particular agency I made the mistake of NOT purchasing from the approved vendor. $1 cables that did the job had to be returnedand replaced by $20 cables from CDW. Multiply that by thousands of employees and you can easily see States, Counties and Cities are going broke fast. Not sure if those policies should be called corrupt or simply incompetent but that is just one of my many experiences.
What no one seems to mention is that the "bean counters" and bureaucracy are a direct result of the lack of trust we have in those institutions. We need everything signed in triplicate, after approval by a committee for the purchase and only after getting three quotes from a list of approved vendors etc etc.

If people really want to see less bureaucracy they will have to accept less oversight and less well-defined processes. It's the record keeping and accountability that gives us $100 toilet seats and all the other horror stories. A facilities manager might manage a 6 figure budget but lacks the authority to order supplies from any vendor who is not on The List. What does that tell us about the trust we place in him, in his professional experience or about the value of a dollar?
Love the comment There's going to be fraud in both systems, but at least the former is fraud for the little guy!
Great post. 

Clay does a great job of highlighting the problem, but I'm disappointed that his solution is just an updated version of what got us where we are.

The problem is that we are trying to regulate a very complex and constantly changing system with a giant set of rules. You can think of government as a giant computer system that is constantly being modified. Something like procurement regulations is a module that affects almost every part of that system, and each procurement rule is a little hard coded rule in the module that looks something like: if cost > 250k then paperwork(x,y,z).

We know what happens in systems like this, you either can't make modifications in ways that make sense because you have to work around rules that weren't designed for them, or you have to keep changing the rules. Either way, you eventually end up with a giant pile of crap that doesn't work and no one understands, i.e. procurement law.

I don't think the solution is to keep adding new rules nor do I think we should restart the rule making process over from the beginning (sort of what +Clay Johnson proposes). I think the solution is to come up with a better rule making process. So what would that look like?

Well, I don't know, but I would look to a few things for inspiration. Machine learning gives us very elegant solutions to complex problems that we used to try to solve with lots of hand crafted rules, if we can make a machine that beats Ken Jennings at Jeopardy surely we can make one that does a better job of legislating than Congress (I'm only half joking).

Another elegant solution, the one libertarians always bring up, is the free market. Unfortunately free markets often do a very poor job of producing the goods and services government provides (hence the existence of government), but that doesn't mean we can't use it for inspiration. Where free enterprise works, one of the secrets of its success is individual accountability. Unfortunately that is something that is often lacking at both the political and civilian employee level.
+Alexander Measure Great name for a guy who believes on science, by the way.

I would ask if anyone here, including +Clay Johnson, has read The Spirit Level. The root of this problem really lies in trust. If we trust that people aren't going to embezzle or misuse the funds entrusted to them, we don't need to add a lot of controls and bureaucracy. If we can't or won't, we doom ourselves to death by paper and process. The pervasive attitude of "other people's money" and entitlement is part of this as well but I think that's also rooted is a lack of trust.
+paul beard Thanks :). I haven't read Spirit Level but I agree that trust is part of the problem.

The problem with trust is that it doesn't scale well. The foundation of trust in my mind is 2 things: deep personal knowledge of the person being trusted and consequences if that trust is violated.

This works great in small social groups. For example, I wouldn't think twice about lending my brother $5,000 if he wanted it. I've known him since he was born, I know he is honest, smart, hardworking, not involved in drugs and other bad things, etc. I also know that if he screwed me over it would be very easy for me to never lend him money again.

In a big social circle that is gone. I have no idea who 99.9999% of the people running the federal government are and if some of them were screwing me over I would have no idea who they were and no way of taking action against them.

Ironically, I think the rapid loss of privacy is doing a lot to improve trust. I know this is a very unpopular idea, but the fact is, in a small town you have very little privacy and that's part of the reason you can trust everyone. If stuff like Facebook and Google+ eventually allows us to know a lot about people without even meeting them, that could be a very good thing.
Govt doesn't have to be the same throughout. Find a place where this is likely to work well and trial it - e.g. In the UK we have

OK, one clear weakness is that these (young?) guys presume that what they achieve will be applied everywhere. It won't, but perhaps those depts/agencies/ministries that can't make it work will lose their IT budget - tax payers can at least dream they might.
You find people in the field who value process over results. At my last startup we had a VP who, when we lost our dsl circuit through a telco error, was more impressed that they had to involve VPs to resolve it than if some guy at the central office had patched it back in.

They need to know there is a binder with the right forms.

But I think it mostly comes down to trusting that other people know what they're doing and that everyone has the same priorities. No corner-cutting or empire building. 
Yes, the color code binders! "I am sorry sir, we can't do that because it isn't in one of our binders"!
Very interesting article by +Clay Johnson and comments from everyone here on this post by +Tim O'Reilly. I look forward to giving this additional thought when I'm not busy handling the purchasing needs of a JIT manufacturing firm catering to the energy industry. 
Supply chain, and in particular the procurement side of things, is a growing area of thought, importance, and impact within any organization. The larger the organization and customers, the more complex and regulated these processes tend to become. It behooves us to find and implement efficiencies all along the supply chain. This article is excellent food for thought. Thanks for sharing!
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