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Dr. Rene G. Rendon, CPCM, C.P.M., PMP U.S. Naval Postgraduate School Monterey, California rgrendon@nps

An Analysis of DoD Services Acquisition: Implications for a Program Management Approach. Dr. Rene G. Rendon, CPCM, C.P.M., PMP U.S. Naval Postgraduate School Monterey, California rgrendon@nps.edu. Overview. Services Acquisition Environment Characteristics of Services

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Dr. Rene G. Rendon, CPCM, C.P.M., PMP U.S. Naval Postgraduate School Monterey, California rgrendon@nps

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  1. An Analysis of DoD Services Acquisition: Implications for a Program Management Approach Dr. Rene G. Rendon, CPCM, C.P.M., PMP U.S. Naval Postgraduate School Monterey, California rgrendon@nps.edu

  2. Overview • Services Acquisition Environment • Characteristics of Services • Results of Preliminary Research • Innovative Approaches to Services Acquisition • Current Research Findings • Conclusion

  3. The Services Acquisition Environment DoD Spending on Services(Source: GAO-05-274, March 2005, pg. 5)

  4. The Services Acquisition Environment Figure 3: DoD's Contracts for Goods and Services(Source: GAO 03-935, September 2003, pg. 4)

  5. The Services Acquisition Environment Services Purchased by the DoD in FY 2000(Source: GAO 02-230, January 2002, pg. 18)

  6. The Services Acquisition Environment • Consistent problems in managing service contracts • Fragmented and uncoordinated approach • Not employing sound business practices • Inadequate contractor oversight

  7. Characteristics of Services • Intangibility of service outcomes • Difficult to define and measure quality • Simultaneity of production and consumption • Co-production requirement for some services • Diversity of services

  8. Presidio of Monterey (POM) • Directorate of Contracting • Reports to POM Garrison Commander • Functionally aligned under Army Contracting Agency Southern Region • DLI is major customer • Major contracts include: • Grounds and infrastructure maintenance • Custodial and janitorial services • Food services, motor pool services • Audio visual and IT services

  9. Presidio of Monterey (POM) • Presidio Municipal Services Agency (PMSA) • Inter-municipal consortium (Monterey and Seaside) • Maintains buildings at DLI and POM • Contractor performance management • POM, DLI, or other benefiting organization • Use of Quality Assurance Evaluators or other Technical Managers

  10. Municipal Workers OMC PMSA DLI POM Contracting Office Independent Vendors Other Customers Other Contractors Services Supply Chain at POM

  11. Travis AFB • 60th Contracting Squadron • Manages over $320M annually • Supports 60th Air Mobility Wing and David Grant Medical Center • Service contracts include • Grounds maintenance, Custodial • Food services, MFH maintenance • Passenger Terminal Operations • Medical services • Successful NIB/NISH Program: Pride Industries, Inc.

  12. Travis AFB • Contractor performance management • Quality Assurance Evaluators • Business Requirement Advisory Group (BRAG) • Cross-functional teams representing service users • Plan and manage contract services life cycle • Develop Statement of Objectives or Performance Work Statement, Quality Assurance Surveillance Plan (QASP)

  13. Pride Industries AMW Hospital CONS Other Contractors Other Customers Services Supply Chain at Travis AFB

  14. Observations from Site Visits • Continued growth in the volume of service acquisition in DoD • POM: Innovative Supply Chain arrangement with PMSA has resulted in significant cost savings • Travis AFB: Proactive and frequent communications are essential for successful service contracts (BRAGs) • Travis AFB: Co-location of contracting squadron (CONS) with Air Mobility Wing (AMW)

  15. Observations from Site Visits • Difficult to establish service specifications and measure and monitor service output and quality. • Ensuring the right number of skilled acquisition personnel is highly critical. The observed downsizing of contracting workforce does not appear to be in line with this need. • The management infrastructure for the acquisition of services is less developed than that for acquisition of products and systems.

  16. Observations from Site Visits • Less formal approach to the acquisition and management of services • Lack of standardization of business practices in services acquisition

  17. Purpose of Continuing Research • Explore the application of a program management approach and project management concepts to services acquisition in the Department of Defense

  18. Program Management Approach • Well-defined, disciplined methodology and infrastructure (PMI, 2004; Kerzner, 2006) • Centralized, coordinated management to achieve the program’s strategic benefits and project objectives (PMI, 2004) • Program management approach incorporates project management concepts (PMI, 2004)

  19. Project Management Concepts • Project lifecycle • Integrated processes • Designated manager with project authority • Integrated cross-functional teams • Enabling organizational structure

  20. A The Defense Acquisition Management Framework Technology Opportunities & User Needs B C IOC FOC System Integration System Demonstration LRIP Full-Rate Prod & Deployment Sustainment Disposal Design Readiness Review FRP Decision Review Concept Decision System Development & Demonstration Operations & Support Concept Refinement Technology Development Production & Deployment Sustainment Pre-Systems Acquisition Systems Acquisition

  21. System Program Director Logistics Systems Engineering Testing Contracting Financial Management Integration Air Vehicle Engine Support Systems Training System Support Engine Analysis & Integration Airframe Support Equipment Operations Support Analysis & Integration Turbo Machinery Maintenance Support Data Propulsion Integration Cockpit Exhaust & Controls Auto Test System Pilot Armament Avionics Vehicle Mgt System Utilities & Subsystems

  22. Traditional Systems PM Structure FM CO Engineer PM S/W Logistics

  23. Traditional Supply Acquisition PCO User Manuf PM SE FM S/W Eng Log

  24. Traditional Services Management Structure(Post Award) FAC CO QAE

  25. Traditional Services Acquisition FAC PCO QAE FM

  26. Traditional Services Acquisition User PCO FAC FM QAE

  27. Access Diagnosis Service Process Planning Execution Continuation Closure Services Life Cycle(Conceptual)

  28. Innovative Approaches to Services Acquisition Management • Air Education and Training Command (AETC) • AETC Program Management Flight • AETC Contracting Squadron • Air Combat Command (ACC) • Acquisition Management and Integration Center • Centralized Panning, Control, and Execution • “Services SPO” • Combined program management and contracting organization

  29. Define Source Buy Ensure Quality Administer Release Services Life Cycle

  30. Program Management Flight (PM) PM HQ Contracting Squadron (PCO) PCO HQ Functional Reps HQ Reps Centralized Services Acquisition Management Pre-Award Post-Award FAC ACO QAE

  31. Innovative Approaches to Services Acquisition Management • AETC Model • Centralized Planning (Pre-Award) • Roles and responsibilities shared by HQ PMF and HQ CONS • Decentralized Execution (Post-Award) • HQ retains PM authority (No on-site PM) • HQ delegates contracting officer authority (On-site ACO)

  32. Innovative Approaches to Services Acquisition Management • ACC Model • Centralized Planning and Execution • Single point control, integrated management, and a unique cradle-to-grave sustainment capability • Integrated services “SPO-like” program management organization

  33. Services Acquisition User PM PCO FM QAE

  34. Research Findings • Traditional approach to managing services acquisition does not incorporate program management approach • Well-defined, disciplined methodology and infrastructure • Centralized, coordinated management • Project lifecycle • Integrated processes • Designated manager with project authority • Integrated cross-functional teams • Enabling organizational structure

  35. Research Findings • AETC model incorporates • Well-defined, disciplined methodology and infrastructure • Centralized, coordinated pre-award management • Project lifecycle • Integrated cross-functional teams • Enabling organizational structure • Integrated processes • No on-site Program Manager • On-site ACO

  36. Research Findings • ACC model incorporates • Well-defined, disciplined methodology and infrastructure • Centralized, coordinated program management • Project lifecycle • Integrated processes • Designated manager with project authority • Integrated cross-functional teams • Enabling organizational structure

  37. Conclusion • Program management approach needed to manage DoD’s critical services acquisition • Well-defined, disciplined methodology and infrastructure • Centralized, coordinated approach incorporating project management concepts • AETC and ACC models provide innovate and successful approaches to services acquisition

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