Federal Acquisition Council Manager’s Guide to Competitive Sourcing



The Federal Acquisition Council (FAC), the Office of Management and Budget (OMB) and the Office of Federal Procurement Policy (OFPP) aim to help every federal agency successfully and transparently implement competitive sourcing. This guide provides a compilation of basic facts, sources, and aids to help agency managers gain a high level understanding of the competitive sourcing process and its requirements, and to achieve and exceed the goals identified in each agency’s Green Plan.

The initial publication of the guide in October 2003 described the underlying purposes of competitive sourcing and provided an introductory primer on recent revisions to Office of Management and Budget (OMB) Circular A-76 that were made in May 2003 to improve the efficiency and effectiveness of competitions.

This 2004 revision to the Manager’s Guide describes some of the promising management practices that have emerged over the past 2 ½ years as agencies work to make competitive sourcing a practical and thoughtful tool to lower taxpayer borne costs and improve mission performance. The best practices are culled from one-on-one and small group interviews with several agencies that have already demonstrated success with their competitive sourcing activities. However, we hope to hear of more “lessons learned” as agencies gain experience, and to make additional updates to the Manager’s Guide as time goes on.

Those unfamiliar with the competitive sourcing process may want to first skip pages 5 through 14 and start at the section entitled “Competitive Sourcing Primer” on page 15. Those closely involved with competitive sourcing will probably find the best practices on page 5 through 14 most helpful.

Best practice highlights include:

  • Overall Philosophy
    Creativity and a long term outlook together build an effective foundation for competitive sourcing decisions and processes. OFPP encourages reasoned risk-taking and is committed to providing prompt, constructive feedback on agency proposals. Cultivating a long term outlook among your employees institutionalizes the factors necessary for success.
  • Setting up Your Competitive Sourcing Infrastructure
    Agencies noted that garnering active support from the senior-most officials of the depart-ment, oversight by a senior and impartial broker, and centralizing management while decentralizing execution were key factors to consider in crafting your competitive sourcing organization.
  • Management Tools for Achieving Success
    Innovations developed by your fellow agencies include an internal scorecard, a two week time limit on all outstanding decisions, fostering a bigger picture, and close coordination with the Human Capital Initiative.
  • Operational Best Practices:
    • Grouping
      Agencies offer insight on grouping functions for competition.
    • Pre-Planning
      Pre-planning (where business case analysis, feasibility studies and consideration of the private sector bidders’ needs are critical) requires proactive, strategic thinking.
    • Seeking Additional Guidance
      A partial, non-exhaustive list of support contractors has been added to the list of resources for your benefit. Their appearance on this list by no means represents a FAC or OMB endorsement. However, support contractors that have already been successfully used by agencies often have substantial knowledge, business acumen, and study experience that can help you in meeting your competitive sourcing goals.

We hope you will find this guide useful and welcome comments and suggestions for improvement.

The primary authors of this guide are Valerie Dumas of the State Department and Eileen Stephens of the Office of Management and Budget, with advice and editorial suggestions from dozens of others. Please send suggestions for improvement to: A-76@omb.eop.gov.

(Executive Summary)