Blog
Managing the Business of Government
Challenge
The Federal Government awards over $1.5 trillion in federal contracts and financial assistance each year—and sometimes much more in times of crisis.
This creates an enterprise-level opportunity to lean on federal systems for managing the business of government—the goods and services we buy and the financial assistance and resources we provide and oversee—to create and sustain good quality union jobs, address persistent racial and gender wealth and wage gaps, and address other challenges our nation faces. The Administration has already taken bold action to leverage federal acquisition and financial assistance to take on our most pressing challenges as a country. Accomplishing these ambitious goals and activities collectively will also require continuous improvements in our procurement, financial assistance, and financial management ecosystems. This shift will require new measures and processes, new training for the federal workforce, and new tradeoffs that agencies together will need to address going forward.
Opportunity
We can harness this collective power and make connections across the federal acquisition and financial assistance systems to strengthen the U.S. manufacturing base and support American workers, catalyze new solutions that address the climate crisis and enhance sustainability, and advance equity.
The public will benefit from a government that buys together and manages financial assistance together, devoting attention to how these systems deliver results—prosperity, security, and opportunity—for all people in this country. Federal agencies will look across existing Administration initiatives to ensure that system-wide, continuous improvement in federal acquisition, financial management, and financial assistance systems occurs. This system-wide focus can include, for example: opportunity and issue spotting, including resolution of conflicts across discrete lines of effort; training and guidance for practitioners within agencies; data-management and evidence-building strategies; and other capacity-building strategies.
Leadership
Strategies
Activity
July 2024
Strategy 1, Federal Acquisitions, continued to advance federal priorities related to federal acquisition efficiency, cost savings, and small businesses. This release includes updates on accomplishments related to existing milestones and highlights the collaborative efforts across agencies to implement improvements that enhance contracting processes and outcomes. Key developments include:
- New Milestones Prioritize Category Management: The introduction of new milestones underscores the importance of government-wide category management (GWCM) efforts to advancing the Business of Government. By focusing on strategic planning to achieve GWCM key performance indicators (KPIs), the new milestones will drive efficiency and more effective resource utilization across federal agencies. The new milestones require all CFO Act agencies to submit detailed fiscal year (FY) 2025 category management plans to Office of Management and Budget (OMB) and involve the Category Management Leadership Council to approve all ten FY2025 category strategy plans. Track all the government-wide and individual agency KPIs on the GWCM Executive Summary Dashboard FY 2024.
- Full Rollout of the Procurement Co-Pilot Application for Government Use: We are excited to announce the full rollout of the Procurement Co-Pilot application. This innovative tool, available for federal use only, is designed to improve the efficiency and quality of market research by providing access to government-wide data to enable agencies to make better, more cost-effective acquisition decisions. The Procurement Co-Pilot aggregates over 80 million rows of data, facilitating three key steps in the acquisition lifecycle: product pricing research, vendor search, and contract vehicle identification. Tailored for contract specialists, officers, and agency buyers, this application enhances market research efficiency by providing unprecedented access to pricing information. Read the fact sheet here.
- Increasing Small Business Participation on Multiple Award Contracts. The Small Business Administration (SBA) and the Federal Acquisition Regulatory Council have begun developing new regulations to increase small business participation in multiple-award contracts. While multiple-award contracts help agencies efficiently purchase common items and services, small businesses can face difficulties becoming contract holders on these vehicles. To address this challenge, the Office of Federal Procurement Policy (OFPP) issued guidance earlier this year that includes a variety of strategies to increase consideration of small businesses, including setting-aside orders awarded under multiple award contracts for small businesses if at least two contract holders are capable of meeting the contract requirements, collaborating early with the SBA and agency small-business specialists to identify opportunities to set aside future multiple award contracts exclusively for small businesses or provide small businesses with “on ramps” to gain access to multiple award contracts that include both small and large contract holders, and evaluating whether leveraging small businesses on “best-in-class” contracts would result in expanding the agency’s small business contracting base. These combined efforts help balance the benefits of multiple-award contracts with encouraging more small businesses to participate in federal procurement.
Under Strategy 2, Federal Financial Management, the Council on Federal Financial Assistance (COFFA) continues to advance the deliverables identified in OMB Memorandum M-24-11. Several new project groups have been established to develop tools to help with the implementation of the 2024 Revision to the Uniform Guidance and to drive government-wide simplification of Notices of Funding Opportunities (NOFOs). In addition, several project groups have come to an end as their last deliverable was finalized, including the development of a charter for the COFFA and the release of a public website – www.COFFA.gov. In the upcoming months the COFFA will continue to make progress across the identified year one priorities as the inaugural year comes to an end in September.
Highlights
April 2024
During the performance period, strategy leads continued to advance federal priorities related to federal acquisition efficiency and cost savings. This release highlights the collaborative efforts across agencies to optimize contracting processes and outcomes. This includes sharing successful practices as part of the Better Contracting Initiative, including performance-based contract requirements and cost containment measures for high-risk contracts. Successful practices are featured in the Acquisition Accelerate (AcqCelerate) Savings Challenge, which gathers a diverse range of strategies aimed at enhancing efficiency and driving acquisition cost savings across federal agencies.
The Council on Federal Financial Assistance (COFFA) continues to identify opportunities to reduce agency and recipient burden in order to strengthen accountability and deliver results for the American people. On February 15, 2024 the Federal Program Inventory became available to the public. This website is a new comprehensive, searchable tool with critical information about all domestic Federal financial assistance information. This website makes it easier for potential recipients and applicants to find programs, ensure the effective stewardship of taxpayer funds, and further increase government transparency. On April 4, 2024 OMB released the 2024 Revision to the Uniform Guidance. These revisions promote a culture of improved stewardship of federal funds, equitable access to programs and services, a reduction of administrative burden for federal agencies and recipients of Federal financial assistance, and streamlined and effective oversight and implementation of federal programs. Together, federal agencies will be working to ensure the consistent implementation of the 2024 Revisions with the COFFA leading this coordinated effort. The COFFA announced a whole of government approach to simplify Notices of Funding Opportunities (NOFOs). This effort, identified in M-24-11, will prioritize simplifying NOFOs for programs where the eligible applicants may have limited organizational capacity, particularly those in underserved communities. The COFFA will be working in the upcoming months to develop tools to reduce the complexity and improve the accessibility of NOFOs to further increase access to Federal financial assistance.
Highlights
February 2024
Since its launch in October 2023, the Council on Federal Financial Assistance (COFFA) has convened Senior Financial Assistance Officers monthly and has also hosted community meetings to share relevant topics with the entire Federal financial assistance workforce. During this period, COFFA leadership identified priorities for the next twelve months to support the vision of the Council:
- Creating a partnership among federal grant-making agencies;
- Providing a single forum to inform Federal financial assistance policy, oversight, and technology activities;
- Providing strategic direction, policy recommendations, and priority-setting for other government-wide grant-related activities;
- Reducing administrative burdens for both federal agencies and recipients of Federal financial assistance, particularly those that may be under-resourced or underserved; and
- Advancing the Administration’s priorities to improve customer experience with delivery of services, improve equity, and leverage Federal financial assistance as a catalyst to build back better.
FY24 Q1 period marked the exciting launch of the Better Contracting Initiative (BCI), a significant step in supporting Strategy 1 within the Business of Government Priority Area. The BCI is a comprehensive, four-pronged strategy designed to improve federal government purchasing. It aims to:
- Ensure better terms and prices for goods and services, with a focus on buying from small and disadvantaged businesses.
- Generate over $10 billion annually in savings and cost avoidance while improving the performance of federal contracts.
- Leverage data across federal agencies, negotiating common enterprise-wide software licenses, and
- Getting contract requirements right the first time–all to support a strategic approach in federal acquisition.
A significant step toward negotiating common enterprise-wide software licenses has been the establishment of a government-wide acquisition strategy Interagency Project Team (IPT), tasked with reviewing agency contract files and analyzing pricing data to identify common terms and a strategic pricing approach for discussions with major software vendors in the coming months. Stay tuned to performance.gov for future updates. For more information about BCI, visit OMB’s website here.
Highlights
December 2023
Under Strategy 1, the team on Priority Area 3 is focused on the Federal Government’s national strategy to build public health supply chain resiliency. Office of Management and Budget’s (OMB) Made in America Office (MIAO) and Office of Federal Procurement Policy (OFPP) are collaborating with experts in requirements, acquisition, and supply chain at the Department of Health & Human Services (HHS), the Department of Homeland Security (DHS), and the Department of Veterans Affairs (VA) in the development of a plan to strengthen the long-term health of the domestic Personal Protective Equipment (PPE) industry in furtherance of the Make PPE in America Act. For Strategy 2, the Council on Federal Financial Assistance (COFFA), established by OMB Memorandum M-23-19, convened for its first meeting in October 2023. Together with the Chair OMB and Co-Chair HHS, council members are developing priorities for the COFFA to accomplish within the first year. One of the projects that already commenced is the identification of the core competencies necessary for the financial assistance workforce. This effort will help to identify the knowledge, skills, and abilities necessary for this workforce that are the same at each Federal financial assistance agency. New milestones are presented in this update to communicate progress toward the completion of this project.
Highlights
August 2023
Through this period, strategy leads continued to advance federal priorities through federal acquisition and Federal financial assistance. This release includes updates on accomplishments related to existing milestones and several new planned milestones.
Highlights
May 2023
Strategy leads continued to implement action plans to advance Federal priorities for sustainability and equity through Federal acquisition and Federal financial assistance. In Federal acquisition, this release includes important updates related to priority supply chains and investing in the acquisition workforce. Federal financial assistance leads announce the release of a new training for the financial assistance workforce.
Highlights
March 2023
Cross-agency teams continued to develop and refine their action plans to advance sustainability and equity priorities for the Nation through the Federal acquisition and financial assistance systems. Each strategy has defined initial success metrics and milestones.
Highlights
November 2022
Cross-agency teams have been working to develop and refine action plans to achieve the President’s vision to leverage Federal acquisition and financial assistance systems to advance priorities for the Nation. Each strategy is defining strategy-wide success metrics to measure progress toward achieving their ambitious goals.
Highlights
Streamlining Federal Buying for Better Efficiency
How category management is saving taxpayer dollars and improving efficiency
Category Management is a strategic approach to help the Federal Government buy smarter and optimize as a single enterprise to purchase common goods and services. It’s a commercial best practice to manage commonly purchased goods and services through common categories which increases efficiency, reduces costs, and minimizes redundancies.
Key program results include:
- $87 billion in cumulative cost avoidance;
- 76% of obligations aligned to category management principles; and
- 100,000 individuals trained
Projects and Milestones
In progress
- 100% of CFO Act Agencies submit FY25 Category Management (CM) plans to OMB – including a specific plan to achieve CM Key Performance Indicators of spend under management, spend through Best-in-Class solutions, and CM training (FY25 Q1)
- Category Management Leadership Council (CMLC) approves all 10FY25 category strategic plans (FY25 Q1)
Agency Spotlight
- Defense Logistics Agency Electronic Cataloging Acquisition Program is an efficient and economical way for federal customers to buy niche-market medical materials. As of April 2024, $161 million (19.9%) in costs were avoided due to this program.
- The General Services Adminsitrations’ IT Vendor Management Office continues to make strides in improving federal IT acquisitions, ensuring that agencies have access to the tools and resources needed to support procurement decisions.
- The government-wide medical category has made notable advancements in tracking and managing the supply chain for critical pharmaceuticals, directly supporting national defense and public health objectives. The Pharmaceutical Provenance Solution (PPS) exemplifies the innovative approaches being employed to enhance supply chain resilience and risk management.
Record-Breaking $178 Billion in Federal Procurement Opportunities for Small Businesses
How historic investments are supporting small business growth and economic equity
The Biden-Harris Administration has set a new record by awarding $178.6 billion in federal procurement opportunities to small businesses in fiscal year 2023. It increased its contract spending with all demographic groups included in the Small Business Administration (SBA’s) disaggregated contracting data. Additionally, 22 agencies received an A grade or higher for their outstanding performance in supporting small businesses.
Projects and Milestones
Completed
- Issued guidance directing agencies to use a common definition for “new entrant” as they take steps to find small disadvantaged businesses and other contractors and measure progress in diversifying the federal supplier base (FY23 Q2)
In progress
- 100% of Chief Financial Officer (CFO) Act agencies have internal agency guidance that adopts or adapts at least five innovative acquisition processes on the Periodic Table of Acquisition Innovations (PTAI), including at least two identified as small business friendly (FY24 Q4)
Agency Spotlight
- Small Disadvantaged Business (SDB) spending exceeded its enhanced annual goal, set at 12% in FY23, with the Federal Government awarding a record-breaking $76.2 billion to SDBs. The noteworthy achievement reflects President Biden’s unwavering commitment to meeting his ambitious SDB contracting goal of 15% by FY25.
- Service-disabled veteran-owned small business (SDVOSB) spending has exceeded its 3% goal, reaching 5%. This achievement translates to $31.9 billion in procurement, reflecting a $3.8 billion spending increase compared to the previous year.
- Historically Underutilized Business Zone (HUBZone) small businesses were awarded a record-breaking $17.5 billion in federal contract awards, marking the highest amount ever awarded in this category in the program’s history.
- SBA’s Women-owned Small Businesses (WOSB) program received $30.9 billion in federal contracting dollars in FY23, up from $28.1 billion in FY22 and accounting for nearly 5% of the FY23 total eligible dollars. This marks the highest dollar amount ever awarded to WOSBs.
Innovation Drives Federal Procurement Success
Acquisition innovation as a catalyst for advancing national priorities and improving federal procurement
The Chief Acquisition Officers Council’s Acquisition Innovation & Small Business Participation in Federal Procurement Report to Congress highlights the role of acquisition innovation in enhancing the efficiency and effectiveness of federal procurement processes.
Projects and Milestones
In progress
- 100% of Chief Financial Officer (CFO) Act agencies have internal agency guidance that adopts or adapts at least five innovative acquisition processes on the Periodic Table of Acquisition Innovations (PTAI), including at least two identified as small business friendly (FY25 Q1)
Agency Spotlight
- The Nuclear Regulatory Commission’s Acquisition Management Division, Office of Small Business and Civil Rights, and Office of General Counsel collaborated to ensure a successful award for the engineering assessment and data center contract. They used innovative acquisition techniques that resulted in an award to a new entrant small disadvantaged business.
- Treasury’s Internal Revenue Service (IRS) Procurement Innovation Branch partnered with its Industry Liaison and small business office to conduct outreach with vendors new to doing business with the IRS. As a result, the IRS awarded 84% of Pilot IRS awards to small businesses.
- Improved Delivery of Online Social Security Services: The Social Security Administration (SSA) used innovative acquisition techniques to accelerate time to award to small businesses for information technology services.
Efficient Federal Financial Assistance
Strengthen and formalize the governance of Federal financial assistance
The Council on Federal Financial Assistance (COFFA) is working to ensure that federal agencies have the tools they need to deliver Federal financial assistance programs in an efficient, effective, and equitable manner, while also reducing administrative burdens on Federal financial assistance applicants and recipients.
Projects and Milestones
Completed
- Published a website to communicate COFFA priorities and resources
- The COFFA members established a charter that outlines how the Council is structured and how it operates within the Federal Government
- Eight agencies committed to piloting several efforts to simplify NOFOs in FY24
Agency Spotlight
The Department of Health and Human Services is the first agency co-lead of the Council on Federal Financial Assistance.
