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Office of Public and Intergovernmental Affairs

Remarks by Former Deputy Secretary W. Scott Gould

VA Supplier Relationship Transformation Webinar
Opening Remarks
Washington, DC
December 9, 2009

Good morning, everyone! And welcome to VA’s first Supplier Relationship Transformation Webinar! Thank you for joining us as we drive forward acquisition reform—a key part of our overarching VA transformation directed by President Obama and led by Secretary Shinseki.

At the outset I’d like to thank our wonderful acquisition leadership team here at VA for organizing this Webinar and everyone else who has a hand in leading this important transformation initiative.

As I said in our first-of-its-kind Supplier Relationship Transformation Forum last August, VA is intent on reconstituting our current acquisitions function into a world-class, leading-edge contracting powerhouse. And you—our suppliers and stakeholders—are a critical ally in making that happen. Secretary Shinseki and I are committed to our partnership for progress—to leveraging your knowledge and understanding of government contracting and to working with you to optimize our mission-critical vendor-supplier relationship.

VA is not interested in perpetuating the status quo or continuing with ‘business as usual.’ We have a pressing need to think and act strategically, with an ‘enterprise’ point of view. We have two primary responsibilities: obtain the best value for VA and the Veterans we serve, and to do it transparently among our vendors and on behalf of the public.

A lot is at stake for our vendors. As the second-largest agency in the Federal government, last fiscal year we spent more than $22 billion in the marketplace for services, materiel, and supplies—everything from physician services and home oxygen, to gravestones, and office supplies. This fiscal year is projected to be even higher.

And, at the same time, a lot is at stake for VA. We want to obtain good value for those 22 billion taxpayer dollars. We have an obligation to be transparent, and to negotiate the best value for our purchases—to buy goods and services without waste—and with the least amount of bureaucratic overhead.

As I mentioned at last August’s forum, collaborations like ours are the one over-riding critical business competency of the Internet age. The former CEO of Proctor and Gamble—Ian Lafley—had this to say about gaining the edge over challenges by leveraging the knowledge of those with the outside viewpoint, the different perspective, and the fresh approach—people who have the expertise to size up complex and contentious issues. Let me quote:

‘Someone outside your organization today knows how to answer your specific question, solve your specific problem or take advantage of your current opportunity better than you do. You need to find them and find a way to work collaboratively and productively with them.’

To the hundreds of vendors who’ve tuned in to this Webinar, let me say that you are the ones Ian Lafely is talking about … the ones who potentially have many of the answers to VA’s challenges—acquisition and otherwise. That is why VA is committed to strengthening and reinforcing our alliance so that we can achieve ‘win-win’ results in terms of a more coordinated, high-performance acquisition function that benefits us both.

Events like today’s Webinar are springboards for progress toward VA’s admittedly ambitious—but achievable—acquisition reform goals. We’ve enlisted your help by asking for your candid assessment of our current practices and processes—the ones that are working well; the ones that are not working so well; and, yes, the ones that are outright failures. And you didn’t hesitate to tell us!

I want to thank you for your tremendous response to our request to share your thoughts, recommendations, and ideas. You’ve voiced your rightful concern about a number of issues:

  • Transparency in VA’s procurement and supply processes;
  • The quality of VA-supplier communications;
  • The clarity of our contract specifications and requirements;
  • Process consistency from contract to contract;
  • The technical knowledge of VA’s contracting workforce;
  • VA’s willingness to manage and share risk;
  • And improving VA’s understanding of the total cost of ownership and the measures of value;

I want to assure you that we are, indeed, working to improve our performance across these areas and more. We are fully engaged in clear-eyed, self-analysis and we are actively strategizing to optimize our acquisition structure, practices, processes, and human capital. Let me be specific here. We are:

  • Investing in our contracting workforce through comprehensive training and development;
  • Providing our current acquisition employees with training. New employees will graduate from our VA Acquisition Academy;
  • Providing a greater level of program and project management education for our technical personnel;
  • Updating and enhancing our acquisition policies, with an eye toward the practical, the readily usable, and the collegial;
  • Using modernized information systems—such as spend analysis/management applications—to help us better understand pivotal, bottom-line issues like cost control and cost of ownership.

And we are undertaking all of these wide-ranging transformative initiatives with your help. Thank you.

We made a number of promises at last August’s kick-off Forum and I’d like to take some time to give you an update on where we stand in keeping those promises.

First, we went on record as saying we’d provide a VA Web site dedicated exclusively to our supplier relationship transformation initiative and although it took longer than we anticipated, it is now up and running! We’ve incorporated feedback links and, to date, we’ve received almost 30 questions, comments, or suggestions that we are addressing. Keep them coming!

Second, we promised you a run-down of what we consider to be VA’s 13 greatest challenges to best support Veterans and their families, and we, in turn, challenged you to submit concepts and ideas that address these high-import, high-value areas. Collectively, they are at the heart of our department’s transformation effort. And individually, each challenge is a stand-alone VA strategic initiative that is, at once, ambitious, balanced, relentlessly Veteran-focused, and demanding of collaboration from every quarter, whether internal or external to VA.

Third, through quite a bit of creative thinking from our contracting and legal teams, we’ve crafted a streamlined process to get your best ideas to us quickly. If you haven’t already, I urge you to check out our Web site where you will find a link for submitting any of your ideas, suggestions, questions, or comments to us. This site is the initial part of our new Virtual Office of Acquisition, which went live on November 2nd. To date, we’ve received ten concept submissions from you—six concerning our greatest challenges—and we look forward to receiving many more. We will be inviting those companies with the most promising ideas to VA Central Office to personally present their proposals to me and to our leadership team. I look forward to hosting many of you in the months ahead.

Fourth, we promised to require and fund training between contractors and government partners to kick off new contracts once they were awarded.

Fifth, our senior acquisition team is “at the table” on strategy and major program management.

Sixth, last summer VA promised to enhance our partnership with you through ongoing dialogue, outreach events, and improved communication.

We held our first information technology Advanced Planning Briefing to Industry on November 17th at the New Jersey Technology Acquisition Center and welcomed over 300 representatives from 210 companies—an unqualified success in our book. Be certain that we will continue to conduct briefings like these, as well as one-on-one sessions for firms that want to provide specific information and feedback to us.

Over the coming months, we are planning a continuing series of industry association roundtables, executive conferences, webinars like today’s, as well as larger forums. Check our Website for the calendar of events.

Next Spring, we will be sending out our first Supplier Perception Survey under the auspices of the Michigan State University Department of Supply Chain Management. Your unvarnished input and candid assessments will help VA gain even more momentum as we work to improve and advance our acquisition and procurement processes.

Looking even further ahead, we are intent on exploring acquisition avenues open to other agencies but which have not been available in VA. I’m talking about opportunities like the Small Business Innovation Research Program, operated through the SBA. We look to your recommendations as we seek out ways in which to enlarge and deepen our acquisitions footprint.

I know you have a full schedule of agenda items before you that speak to the issues and challenges we confront, including:

  • An overview of our overarching Customer Satisfaction Initiative—of which Supplier Relationship Transformation is a part;
  • Our VA governance process for this Supplier Initiative;
  • A more in depth discussion of the acquisition process issues you identified at the August forum;
  • An overview of our process for receiving and assessing your concepts to meet our 13 challenges.

So in closing, let me thank each of you for participating in today’s Webinar—just one in a continuing series of events that reflects our department’s firm intent to pursue a mutually productive VA-vendor alliance that will better serve the courageous men and women who protect and defend us all.

Thank you.